We think of Google and Facebook as Web gorillas. They’ll be around forever. Yet, with the rate that the tech world is moving these days, there are good reasons to think both might be gone completely in 5 – 8 years. Not bankrupt gone, but MySpace gone. And there’s some academic theory to back up that view, along with casual observations from recent history. ...
... In the
tech Internet world, we’ve really had 3 generations:
- Web 1.0 (companies founded from 1994 – 2001, including Netscape, Yahoo! (YHOO), AOL (AOL), Google (GOOG), Amazon (AMZN) and eBay (EBAY)),
- Web 2.0 or Social (companies founded from 2002 – 2009, including Facebook (FB), LinkedIn (LNKD), and Groupon (GRPN)),
- and now Mobile (from 2010 – present, including Instagram).
With each succeeding generation in tech, it seems the prior generation can’t quite wrap its head around the subtle changes that the next generation brings. Web 1.0 companies did a great job of aggregating data and presenting it in an easy to digest portal fashion. Google did a good job organizing the chaos of the Web better than AltaVista, Excite, Lycos and all the other search engines that preceded it. Amazon did a great job of centralizing the chaos of e-commerce shopping and putting all you needed in one place.
When Web 2.0 companies began to emerge, they seemed to gravitate to the importance of social connections. MySpace built a network of people with a passion for music initially. Facebook got college students. LinkedIn got the white collar professionals. Digg, Reddit, and StumbleUpon showed how users could generate content themselves and make the overall community more valuable. ...
... Social companies born since 2010 have a very different view of the world. These companies – and Instagram is the most topical example at the moment – view the mobile smartphone as the primary (and oftentimes exclusive) platform for their application. They don’t even think of launching via a web site. They assume, over time, people will use their mobile applications almost entirely instead of websites.
We will never have Web 3.0, because the Web’s dead.
Web 1.0 and 2.0 companies still seem unsure how to adapt to this new paradigm. Facebook is the triumphant winner of social companies. It will go public in a few weeks and probably hit $140 billion in market capitalization. Yet, it loses money in mobile and has rather simple iPhone and iPad versions of its desktop experience. It is just trying to figure out how to make money on the web – as it only had $3.7 billion in revenues in 2011 and its revenues actually decelerated in Q1 of this year relative to Q4 of last year. It has no idea how it will make money in mobile.
The failed history of Web 1.0 companies adapting to the world of social suggests that Facebook will be as woeful at adapting to social as Google has been with its “ghost town” Google+ initiative last year. ...
... The bottom line is that the next 5 – 8 years could be incredibly dynamic. It’s possible that both Google and Facebook could be shells of their current selves – or gone entirely.
They will have all the money in the world to try and adapt to the shift to mobile but history suggests they won’t be able to successfully do it. I often hear Google bulls point to the market share of Android or Eric Schmidt’s hypothesis that Google could one day charge all Android subscribers $10 a month for value-added services as proof of future profits. Yet, where are all the great social success stories by Web 1.0 companies? I imagine we’ll see as many great examples of social companies jumping horses mid-race to become great mobile companies. ...
... The Googles and Facebooks of tomorrow might not even exist today. And several Web 1.0 and 2.0 companies might be completely wiped off the map by then.
Fortunes will be made by those who adapt to and invest in this complete greenfield.
Those who own the future are going to be the ones who create it. It’s all up for grabs. Web monopolies are not as sticky as the monopolies of old.