Alcatel Web 2.0 services Quick reference guide

New communication behaviours in a Web 2.0 world — Changes,
challenges and opportunities in the era of the Information Revolution
STRATEGIC WHITE PAPER

2New communication behaviours in a Web 2.0 world
Table of contents
Executive summary 3
Introduction 5
1. Global change in communication behaviours 6
1.1 How are behaviours changing? 6
1.2 Technology – enabling the changes to happen 6
1.3 Web 2.0 – The Read/Write Web 8
1.4 Evolution stages of the internet Web 2.0 9
2. The impact of change on internet users 10
2.1 Attitudes of internet users 10
(i) Individuals as Users 2.0 10
(ii) Corporations as a specific community of Users 2.0 10
2.2 Impacts on behaviours of online users 12
3. Show me the money! 17
3.1 Advertising 17
3.2 Data mining 18
3.3 Network capacities building 18
3.4 Enterprise 2.0 growth 19
3.5 Web 2.0 going mobile 20
4. Non-believers 2.0 – fears and criticisms 22
5. Beyond Web 2.0 – future evolution of the internet 23
Appendix A: Web 2.0 elements 24
Appendix B: Software technologies available to serve Web 2.0 28
Appendix C: Examples of corporate involvement in Web 2.0 29
Appendix D: Environment for Web 2.0 32
About the authors 35
Contacts 35
Notes 36
Acronyms 39

3New communication behaviours in a Web 2.0 world
Executive summary
Social communication has changed. In the past two decades, technical devices have brought
more collaboration, social interaction, personalization, active participation and communication
itself than ever before. One of the main reasons for this has been the emergence and spread of
broadband internet. However, associated technological advances, such as
email, messaging, rich internet applications, content generation application,
mash-ups and enterprise applications, have also played a major role.
This stage of internet evolution is known as Web 2.0. It is already having
an effect, not only on societies and communities but also on businesses and
established business models.
But most of all, perhaps, it is having an effect on users: on how they react
to the promise of an evolved internet, on what they do with it – even on
exactly who those users are. Together, these factors are creating a new type
of user. He or she is User 2.0.
In this paper we look at the effects of Web 2.0 on the behaviours of online users. These effects
include:
1. Shift of attitudes of internet users
2. Growth in broadband connection
3. Content being delivered free of charge
4. Online social networking as a new communication domain
5. Fragmentation of consumer markets
6. The internet as the main source and transmitter of knowledge
7. Internet privacy, online security and data ownership
Web 2.0 is affecting corporations too. For these businesses, the spread of broadband and online
services brings new revenue opportunities. However, it also threatens current business models.
Internally, enterprises globally will increasingly make 2.0 ‘tools’ part of their routine.
Collaboration productivity tools, unied communications, virtual worlds and Web services are
among the tools likely to be adopted. Their adoption will, in turn, drive the growth of a social
networking enterprise software industry.
As new internet Web 2.0 services emerge, online advertising will grow in importance. There are
a number of reasons for this. Firstly, an increasing number of users are spending an increasing
amount of time on the internet. As new companies appear offering tools that make Web 2.0
even more attractive, this trend will accelerate. Advertisers will obviously want to reach this
vast audience. And this change will not just involve private individuals: as corporate use of the
internet increases, not only will advertising offer a way to reach such businesses, but it will also
offer the corporates themselves a way to reach potential customers – both high-level clients and
ordinary consumers.
Traditional advertising vehicles, like magazines and television, will probably continue to attract
signicant advertising budgets for some time to come. However, as audiences spend less of their
free time watching TV and more online, internet advertising will grow quickly.

4New communication behaviours in a Web 2.0 world
It’s no surprise, then, that the global online advertising market is expected to double in size from
2008 to 20121. And as it grows, the companies that helped to bring users to Web 2.0 will have
a further role to play in its evolution. Providers of Web 2.0-based services will need to develop
new advertising models based on users’ behaviours and willingness to buy. Already ideas like
‘personal CPM’ (cost per thousand page impressions) and ‘pay-per-sell’ are attracting interest.
It is by no means clear, however, that these models will eventually be widely employed. But
whatever the payment model, it will rely heavily on information about the internet user and his
or her behaviours. This information is available already: every internet user leaves a ‘footprint’
whenever they go online. The challenge for service providers and content providers is to mine
this data and make use of it, and to do so in a publically acceptable way.
Technological evolution (mainly in the form of software applications and connectivity) will
remain the main enabler of changes in communication behaviour over the next ve years. The
number of global internet users is likely to triple by 20122. The average time spent in front of
the computer will grow. The amount of data transmitted will multiply; within four years it is
expected to be seven times the level of today3. To meet this demand, higher capacity networks
will need to be deployed.
Mobile internet use will become a key driver of this trend. In fact the mobile Web is rapidly
becoming the preferred method of internet access globally. The growth of Wireless Broadband
Access (WBA) technologies, the migration of traditional telecom networks to internet networks
and the availability of affordable and functional Wi-Fi and dual-mode Wi-Fi/mobile phones will
all boost the usage of mobile broadband internet. However, this usage in
turn will require more and better mobile devices.
This paper has a number of aims. It aims to explain how changes in
communication and social behaviours are affecting consumer behaviours. It
tries to nd out what this means for the new internet environment we call
Web 2.0. And it examines ways in which the opportunities arising from Web
2.0 might be monetized.
But this paper also has a much more fundamental aim. It is targeted at
an audience that is starting to become aware of Web 2.0 and the issues it
raises – an audience that wants to learn more about the changes Web 2.0 is
bringing and the impact those changes could have.

5New communication behaviours in a Web 2.0 world
Introduction
In the 18th century the Industrial Revolution introduced steam power and power machinery,
changing agriculture, manufacturing and transportation forever. As the Industrial Revolution
took hold it started a process of wealth and population growth, increasing international trade
and urbanisation.
The Industrial Revolution affected everyone. As new machinery was introduced the need for a
manual workforce declined. Many workers and farmers lost their jobs. However, there was now
a need for a new breed of worker with different skills. Innovations and new ideas drove this
process, a process which led to unprecedented economic growth and improved living standards,
though not before it completely transformed, and even destroyed, the traditional habits and
ways of life of many people.
Today, 250 years later, we are at the beginning of a similar revolutionary step. The rapid
development of information technologies and the global internet are creating a new shift in
society. Value is more and more being driven by knowledge and access to information. This is
the start of the Information Revolution era.
Like the Industrial Revolution, the Information Revolution will, over time, affect everybody
on the planet. It will bring new behaviours and value shifts. People’s old habits will change or
disappear as they adapt to a changing world. And every change will be driven by innovations –
innovations which will change the way people think and understand.
The rst steps in this development can already be seen. The dramatic evolution of technologies
and the growth of broadband internet, along with a greater technical understanding of ordinary
people are together starting to reshape social behaviours and introduce new communication
behaviours.
The evolution process is constant. It is driving change at an extraordinary rate and is itself
driven by innovations and new ideas and their implementation into our daily lives. On the
internet, this change is called Web 2.0.
“We are not living through a technology revolution. We are
living through a value revolution that is being driven by the
inexorable march of innovation.”
PAT RUSSO, ALCATEL-LUCENT

6New communication behaviours in a Web 2.0 world
1. Global change in communication behaviours
Changes affecting the internet and the telecommunication industry are the result of changed
communication behaviours, going back more than two decades. The spread of broadband
internet and the development of Internet Protocol (IP) were the basis for the evolution of new
software and technological devices. The result has been an evolutionary shift in the internet.
1.1 How are behaviours changing?
People’s communication behaviours are clearly changing. But how? A number of trends or
factors stand out:
•Collaboration4
People are starting to take a more active role in the development of information and knowledge.
Traditional reference works, such as encyclopaedias, are no longer seen as the only sources of
reliable information. Through collaboration – the collective development of information and
knowledge – more people have more access to a greater fund of global knowledge than any
formalized information source has previously been able to provide.
•Social interaction
The internet allowed people to develop and capitalize on their social circles (such as networking
groups and sports clubs). It then allowed people to expand them.
•Personalization
People now want more personalized information. The changing radio industry is an example of
this. In recent years there has been a growth in the number of small radio stations focusing on
niche markets, like news, jazz, sport or Latin music, all enabled by the ability to disseminate: the
internet gives access and communication, worldwide, to even the smallest of niches.
•Active participation
People are no longer passive receivers of information. They want to contribute and share their
own perspectives.
•Communication through technical devices
Internet communication is slowly taking over from traditional phone-based voice
communication and face-to-face communication. Restrictions to local or regional communities
no longer apply: the internet has enabled easy global communication.
These social changes are being driven by wider socio-economic changes. Once the conduits
for changing trends were the mass media (TV, radio and newspapers), the phone and personal
social circles. The internet has not only taken over this role but advanced the pace of change,
becoming a platform for high-speed innovation across an ever greater mass of people.
And the internet itself has changed radically in its short history. Once it was a network created
by a few skillful developers. Most users were passive readers of unstructured content with access
to very basic search functions and with limited options to inuence that content. Today’s
internet is more user-focused; users drive the development of the network and can directly affect
the quality of the content.

7New communication behaviours in a Web 2.0 world
1.2 Technology – enabling the changes to happen
The growth in xed and mobile broadband has created a richer multimedia communication
environment. This has shifted the emphasis from personal communication and voice transmitted
communication to a multimedia and multi-content way of communicating. The environment is
the Web – and the Web is now becoming the market in its own right.
Telecoms
MobileWireline
Devices IT
Content Internet
Fixed
wireless
The evolution of broadband and IP has expanded the business of telecommunications service
providers. Once solely concerned with the delivery of voice services, they are becoming truly
multimedia companies, bringing together voice, data and content. Meanwhile, a parallel trend
has emerged where traditionally internet companies (Skype is an example) are now in the voice
business.
Hard on the heels of these changes has come the development of software solutions that have
enabled changes in user behaviours. Content generation technologies such as Flash and Ajax
have enabled much richer online experiences. And technologies have emerged enabling content
search, mark-up and collaboration driven by RSS and XML formats (see Appendix D).
With a richer
multimedia
communication
environment
come new ways of
communicating
Source:
Alcatel‑Lucent

8New communication behaviours in a Web 2.0 world
The ease with which Web software applications can be crafted adds to the pace of change of
these new communication behaviours. More and more users can now create and publish their
own content. And with the growth and spread of digital technologies over the last two decades
has come a new generation of ‘digital natives’, more at ease with those technologies than any
preceding generation.
With these software developments have come new types of internet portals, such as blogs, social
networks and virtual lives. In many ways these are the true essence of the new generation of the
internet and the major drivers of user communication behaviour changes (see Appendix A).
“the mostly read-only Web”
250,000 sites
45 million global users
published
content
user
generated
content
Web 1.0
1996
“the wildly read-write Web”
80,000,000 sites
1 billion+ global users
published
content user
generate
d
content
Web 2.0
2006
collective
intelligence
1.3 Web 2.0 – The Read/Write Web
We have established, then, that communication behaviours are changing. We have also shown
that a number of new technologies are making this possible. For many people the combination of
these two factors equals Web 2.0. But is it quite so simple?
In fact since Tim O’Reilly rst used the term Web 2.0 in 2004 there have been many attempts
to dene exactly what it means. The current most comprehensive denition comes, not
surprisingly, from O’Reilly himself. He says5: “Web 2.0 is a set of social, economic and technology
trends that collectively form the basis for the next generation of the internet – a more mature, distinct
medium characterized by user participation, openness and network effects.”
The changing
face of the Web
Source: http://
www.labnol.org/
Internet/favorites/
the‑difference‑
between‑web‑10‑
and‑web‑20/665/

9New communication behaviours in a Web 2.0 world
Based on this denition the key changes brought by Web 2.0 are:
•Using the Web as an applications platform
•Democratizing the Web
•Employing new methods to distribute information
In the Web 2.0 era the power over content has been moved from the network and page
administrators to the end-users – hence the term Read/Write Web. The Web is no longer a
passive environment; it is one in which people actively contribute.
1.4 Evolution stages of the internet Web 2.0
As new technology comes into play, new possibilities emerge. The second generation internet
gave the user the power to contribute content and further develop the environment in which
the internet operates. At the same time a new process began: the process of linking content
together and creating a real network, rather than just isolated Web pages and services. Google
page rank – a breakthrough in search – is an early stage of the Web 2.0 era6.
User involvement in content development began with users developing and sharing their own
content on a given platform. They were able to use all the tools and options that the platform
offered them, but not to change it. Examples of these rst generation services include sites like
blogger.com, wikipedia.org, or youtube.com.
We are now in a second stage, where users can customize the platform (or
parts of the platform, even if the core stays the same). This is done with
tools like widgets (also called gadgets), mash-ups (software plug-ins), or RSS
(feeds providing constantly updated information on topics of interest to the
user). With these tools, users can change the core patterns of the platform
based on how they would like to see it.
We can only guess what could happen next. For example, could a third
stage of Web 2.0 allow users themselves to develop individual platforms in
open software environments? Of course, in order to achieve this, the use
of software tools would have to be greatly simplied. However, were this to
happen we would be talking again about an evolutionary development of a
new internet generation. The internet might become the core of computer
operations, taking the place of operation systems as we know them today.
We will explore this further when we look at Web 3.0.
Could a third stage of
Web 2.0 allow users
themselves to develop
individual platforms in open
software environments?

10 New communication behaviours in a Web 2.0 world
2. The impact of change on internet users
Changes to the internet are clearly having a major effect on the Web environment. But most of
all, perhaps, they are having an effect on users: on how they react to the promise of an evolved
internet, on what they do with it – even on exactly who those users are. Together, these factors
are creating a new type of user. He or she is User 2.0.
2.1 Attitudes of internet users
2.1.(i) Individuals as Users 2.0
An increasing number of individual users rely on the internet to full their communication,
entertainment or social needs7. Their online presence mirrors their ofine activities such
as hobbies, socializing with friends, studies or just having fun. As a result, groups of users
are creating internet communities. Every user is usually a member of a number of internet
communities.
Users have changed from passive receivers of content into active creators and contributors (see
table). As we have noted, this is happening through blogs, social networks, wikis, mash-ups,
virtual worlds, RSS, widgets and other tools.
USER 1.0 USER 2.0
Passively reading and searching for content Actively creating and sharing content online
Dependent on the content creator; not able to express own opinion Can express opinions and even change the content presented
Usually using dial-up or first generation broadband connection Usually using broadband internet connection, or even optical fibre
Getting the Web as it is Customizing Web pages and content
Email is the main communication tool Peer-to-peer programs are the main communication tools
The computer is the main access point Able to connect from various devices
Logging on to the internet for time-limited sessions Often connected online all the time
Comparison of User 1.0 and User 2.0
  2.1.(ii)CorporationsasaspeciccommunityofUsers2.0
Corporations are entering this environment, either as a specic community (of employees or
business partners, say), or as creators of an internet environment (such as content, platforms or
applications) for individual users.
This movement is often described as Enterprise 2.0. It was initially dened, by Andrew McAfee
of Harvard Business School, as: “The use of emergent social software platforms within companies, or
between companies and their partners or customer”8
Enterprises start driving new communication approaches for a number of reasons but they are
usually internal and/or market driven.
Source:
Alcatel‑Lucent

11 New communication behaviours in a Web 2.0 world
Internal motivators can be:
• Employees
Employees bring new communication behaviours and habits from the external environment to
which enterprises need to adapt.
•Knowledge management
The opportunity for better accessibility and management of corporate knowledge through
collaboration.
• Innovationsmanagement
The opportunity to drive innovations through collaboration and networking.
•Costs
Technology costs can be reduced by capitalizing on open software applications and simplied
data management tools.
•External communication
The need to adapt to users with changed communication preferences.
Market driven motivators can be:
•New consumer preferences, such as consumers preferring online communication
• The need to nd new forms of direct interaction with customers
•Marketing and sales opportunities
•The opportunity to develop new products or enhance existing products
Put simply, Enterprise 2.0 is a new approach to corporate activities that involves capitalizing
on the developments brought by Web 2.0 and social networking in the corporate environment.
Examples of this could be developing a shared knowledge in the workplace or more intense
interaction and relationship-building between various teams and with the corporate customer.
In the Enterprise 2.0 corporate environment the method of spreading information and
developing a shared knowledge among employees has changed. Elements learned from social
networks are being adopted. An example of this is internal corporate blogs: these facilitate
discussion and idea-sharing among employees (replacing emails). Another is the use of wikis
as a way of spreading knowledge and information among employees (replacing un-editable
documents and spreadsheets). This system gives employees the rights to improve the content
and collaborate in the nal decision-making process9.
Mash-ups are evolving as an effective way to integrate multiple Web services. Thus, some
enterprises are starting to turn to Web-based service providers to replace in-house functions.
SaaS10 could even replace traditional IT functions in the near future. However, Enterprise
Web 2.0 means more than just SaaS. All the various technologies, products and sites grouped
together as Web 2.0 have one thing in common: interactivity11.
The original Web was based on simple client-server architecture, designed for electronic
publishing. That worked well for internet-based books, magazines and mail-order catalogues, but

12 New communication behaviours in a Web 2.0 world
not as well for more complex applications. Web 2.0 is closer to the peer-to-peer architecture12 of
the underlying internet, designed for two-way communication.
Enterprises from similar elds tend to respond similarly to the opportunities and challenges
brought by Web 2.0. Hence the development of such terms as Telco 2.0, Media 2.0 and
Mobile 2.0.
2.2 Impacts on behaviours of online users
The major impacts are:
i. A shift of attitudes of internet users
ii. Growth in broadband connection
iii. Content being delivered free of charge
iv. Online social networking as a new communication domain
v. Fragmentation of consumer markets
vi. The internet as the main source and transmitter of knowledge
vii. Internet privacy, online security and data ownership
2.2.(i) Shiftofattitudesofinternetusers
Today’s internet users are more strongly engaged. In many cases, this means that they have
switched from their traditional reader/consumer roles to those of active creators.
This takes the internet network into a new phase, one where a growing number of users are
taking an active role in the development of content and applications. Global shared knowledge
results from collaboration, where ‘the knowledge of crowds’ ensures that information is correct
and up-to-date.
Consumers – internet users – are donating their free time to the development of online content
and are sharing it free of charge, in such forms as blog posts, videos, podcasts and software
applications. They are enjoying building new relationships online through social networks and
virtual worlds. And they are updated about the news that interests them through RSS feed
messages.
Internet users are less inclined to spend their free time watching TV and more likely to increase
their time spent online13. They are increasingly likely to need ‘always on’ broadband and mobile
broadband: internet connection almost everywhere and at any time.
This process is also termed ‘democratization of the Web’. This means that everybody has the
right to contribute and all opinions are taken as equal, regardless of the author’s social status,
academic education or occupation. A vast amount of knowledge is available online, much more
in fact than has ever been collected in one place at one time14. For many users the internet is
even becoming the main source and transmitter of knowledge.
The combination of the internet, Web 2.0 tools and a new philosophy is the starting point for
this trend. It is, arguably, the rst medium in history to enable the real-time engagement of its
consumers.

13 New communication behaviours in a Web 2.0 world
2.2.(ii) Growth in broadband connection
Worldwide spending on internet connections reached $160 billion in 2007 and will grow to over
$251 billion in 201215, 16. The total number of internet users globally is currently 1.24 billion.
This gure is expected to rise to 3.1 billion in 201217, 18.
Internet
population
18.90% 81.10%
Internet
population
45% 55%
The broadband market is growing rapidly. The number of subscribers doubled from 2003 to
2007 and is likely to double again between 2008 and 2012, rising to 600 million. Revenues are
growing at a similar rate. Although ARPU is slowly declining, this is compensated for by the
growth in subscribers. ARPU will continue to decline, but after 2007 it will fall at a slower rate.
Global broadband revenues in 2007 were €75 billion ($150 billion) and are expected to jump
to €117 billion ($234 billion) in 2012. Most broadband internet connections are in developed
countries, with 80 per cent of Europeans using the internet connecting through a broadband
internet connection19.
700
600
500
400
300
200
100
0
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
140,000
120,000
100,000
80,000
60,000
40,000
20,000
0
Subscribers (millions of users) Revenues (emillions)
Share of internet
population in the
total population
in 2007
Share of internet
population in the
total population
in 2012
Source:
Alcatel‑Lucent
Growth in number
of broadband
subscribers and
revenues globally
2002-2112
Sources:
Ovum, In‑Stat,
Alcatel‑Lucent
estimates

14 New communication behaviours in a Web 2.0 world
2.2.(iii)Contentbeingdeliveredfreeofcharge
Early adopters of Web 2.0 applications (content providers and peer-to-peer networks) made
most of the content available to the end-user free of charge. This makes it difcult for other
content providers entering the market to come up with sustainable business models, a process
also known as ‘commoditization of content’. Content providers are thus forced to change their
business models. To make up for the lack of revenue from the content itself they are looking to
alternative income streams: bundling the content with other services, for example, or bringing in
advertising.
If content is free the question arises: who is actually paying for the internet? Aside from
advertisements the main revenue streams are network connection fees. In fact some users
actually confuse payment for the internet connection with payment for content, believing that
paying for a connection gives them the right to download content free of charge and legally. The
result could be a business model in which internet providers partner with content providers to
develop common offerings for the end-user20.
Apart from connection fees, the main source of internet revenue is advertising. Analysis
indicates that more than 80 per cent of all revenues of social networks and other content
delivering applications comes from this source. However, despite the tremendous growth of
online advertising21, the income from advertising alone won’t be sufcient to make the industry
protable. Most of the spending will be split among a few players, with current leader Google
and its concept of content advertisements earning over $16.6 billion during 200722).
However, other possible sources of revenues are being examined. One is user payments, possibly
in the form of gate-keeping fees. In this system the user pays for access to an application or
premium content. Another is micropayments. Here, users buy small virtual items for virtual
money, allowing them to increase their user experience in the service. Other revenue sources,
albeit underdeveloped at the moment, include product afliations, whereby various companies
tie their products together, and corporate partnerships that capitalize the services of both
partners. For example, a social networking site might deliver tailored content from a partner
news site to registered users, thus expanding the user base of both sites23.
Peer-to-peer networks and video-sharing services such as YouTube, however, have also
uncovered a possibly sensitive area. A large proportion of the content shared in such instances
may in fact be breaching intellectual property rights, something that could be regarded as a
threat, in particular by the music and movie industries.
2.2.(iv) Online social networking as a new communication domain
Since the rst social networking portals were created in 2005, the new medium has enjoyed
tremendous growth, reaching an estimated 328 million online users in 2008. Growth is
expected to continue at 20 per cent a year until 2012, when these portals will reach 565
million users24, 25. Led mainly by young users, 42 per cent of all internet users in developed
countries regularly visit social networking sites26, 27. The share of users in developing countries
is also growing strongly.
Social networking services are very effective ways to communicate among people, in many
cases replacing email or mobile text messages. They also serve as a way to share content such as

15 New communication behaviours in a Web 2.0 world
videos, images and music. And they are a much more effective way for users to stay connected
to, and updated about, the activities of huge numbers of other users on a richer scale than any
one-to-one personal network.
Online social networking services are now starting to replace TV and many other media forms
as places for young consumers to spend their free time, in part because ‘always on’ internet
broadband connections allow them to have unlimited time online. In fact the average consumer
in Europe spends 12 hours a week online and nearly a third spend upwards of 16 hours28.
2.2.(v)Fragmentationofconsumermarkets
Consumer habits are shifting. There is now a higher level of individualism and differentiation.
This in turn is eroding traditional approaches to market segmentation, as consumer groups
become even more segmented29.
Web 2.0 is strengthening this trend. Every internet user can pursue his or her specic interest
online, be it nding books on very specic topics, or a niche musical taste, and nd a network
of like-minded people. In a small community this market group would lack critical mass. On
the internet, all like-minded users can be part of it. The global reach of the internet gives
these niche market segments a large collective population and can provide relevant business
opportunities, not least because potential customers can be reached easily through the internet30.
Further enhancing such business opportunities is the growing ability of ISPs and service
providers in general to understand their customers in much more detail;
they now have the ability to understand customer habits and behaviours and
classify their users into very specic marketing/opportunity segments.
2.2.(vi)Theinternetasthemainsourceandtransmitterofknowledge
Through internet encyclopaedias such as Wikipedia and information-sharing
Web elements such as blogs, videos and podcasts, not to mention search
powerhouses like Google, the internet is becoming for many people the main
source of information and knowledge development. Much of this knowledge
is based on collaboration (which we referred to earlier as ‘the knowledge of
crowds’).
The internet has also enabled global co-operation in R&D. Research teams
worldwide are co-operating on similar tasks, taking advantage of each
other’s free computing capacity and thus increasing the capacity of the wider
network, an approach similar to peer-to-peer networking31.
2.2.(vii)Internetprivacy,onlinesecurityanddataownership
The massive spread of collaboration tools and social networking providers
has a downside, however: it creates new opportunities for security attacks
and data frauds. Hackers have found new ways to attack computers through
applications and mash-ups uploaded on social networking portals. This
approach is growing in popularity as users learn how to deal with email
attacks. In the rst half of 2007 Symantec research documented three times
The global reach of the
internet gives niche market
segments a large collective
population and can
provide relevant business
opportunities

16 New communication behaviours in a Web 2.0 world
as many plug-in vulnerabilities as there were in the same period a year earlier. In total, 61 per
cent of all vulnerabilities were related to specic Web applications32. It is expected that in the
near future attacks will move from personal computers to mobile phones and mobile devices.
A second concern is individual privacy and the security of published information. Such
information can be and is being misused for nancial fraud, among other purposes.
The question of data ownership is also becoming a serious issue. At the moment it is unclear
whether the true owner of any given form of data is the service provider or the individual
user. This raises the question of who is allowed to edit such data and indeed who should take
responsibility for the data’s compliance with law and good practice.
This question also extends to ownership among users. Take images of other people, for example.
Can one user share his or her own images of another user without their consent? This has not
been claried.

17 New communication behaviours in a Web 2.0 world
3. Show me the money!
Web 2.0 has already changed the core business of a number of corporations across various
industries, bringing new revenue opportunities linked with the growth and spread of broadband
and online services. And more companies from more business segments will join the broadband
economy in the near future. This in turn will provide new revenue opportunities for companies
providing access, applications and services.
As for where the monetizing opportunities will come in the next ve years, the following areas
are likely to dominate:
i. Advertising, which will become much more personal and engaging
ii. Data mining, from which it will be possible to derive real-time insights into people’s
behaviours and hence target services and adverts
iii.Network capacity building
iv. Enterprise 2.0 growth
v. Web 2.0 going mobile
3.1 Advertising
New advertising platforms will be developed. They will use mobile phones, mobile messaging,
mobile internet, contextual messages on social networking sites and personalized email messages
as ways of approaching customers. And they will depend more and more heavily on automated
tools and databases to allow accurate targeting of those customers. The global online advertising
market is expected to reach $44.6 billion during 2008 and $73 billion by 201233.
To date, there have been two main approaches towards online advertising. In the pay-per-click
model, advertisers pay an internet page owner only if the user clicks on their advertisement. This
model, popularized by Google, is used by content-targeting advertisements.
In the pay-per-view model, advertisers pay for every appearance of the advertisement, whether
the user has decided to click on the ad or not. This mainly applies to banner advertisements on
Web pages.
In the near future new models may evolve. Social networking services34 in particular are likely to
nd innovative ways to monetize the huge user base and knowledge about user behaviours that
they have managed to collect in recent years. A new type of advertising, behavioural ads, will
allow reaction to consumer behaviours in almost real-time and the targeting of the real needs
and wishes of the consumer35.
Then there are personal CPM36 and pay-per-sell. Personal CPM is the value that advertisers
would ascribe to someone who tells their own social circle about a product or service that
would otherwise be advertised to them. The more valuable the social circle is to that particular
advertiser and the greater the weight that a particular individual has within that social circle to
inuence behaviour and consumption, the more valuable that individual’s Personal CPM would
be to that particular advertiser.37
The idea behind pay-per-sell is that the advertiser pays for every purchase the customer makes
and a share of the payment goes to internet page owners where the customer has come in

18 New communication behaviours in a Web 2.0 world
contact with the product. This derives from the real-world concept that to make a shopping
decision customers need several experiences with a product.
To make such approaches effective the advertisers will need technological solutions (both
software and hardware) from the telecommunication industry that are capable of storing the
required data. They will also need help in understanding the customer better and new spaces in
which to place adverts (video messages and email editors, for example).
3.2 Data mining
Every user of the internet today leaves a footprint detailing his or her activities. Specialists
can now read and analyze that information and provide much more detailed data about user
behaviours in the online world than would have been possible a few years ago. This is in part
because of advances in technology but also because of the increased amount of information
available on the internet and other digital formats. The rise of open source software in particular
has made it is easier to pull together information from various incompatible
sources such as different databases and internet user information.
The result is that there is a huge amount of information available about
literally everyone – and a potential goldmine for those who have the tools
and are able to collect this data. Businesses, for example, can use the data
they have available about their customers to increase sales propositions,
create and test new products in the online environment, or try out and
improve their approaches to marketing communication.
Telecommunication service providers and vendors in particular are in a good
position. They have relevant data about the behaviours of their customers
and by correct mining they will be able to extract the knowledge needed.
This can then be used to meet the information requirements of advertisers
and content providers.
And data mining has another potential role: as a way of increasing internal
efciency and testing the success of new processes inside an organization.38
In the next ve years the importance of data mining will increase and will
lead the sales and marketing activities of many companies in the online
environment. Deeper knowledge about the end-customer will become a
major source of information and enabler for targeted advertising.
3.3 Networkcapacitybuilding
Always-on connection and tremendously increased data ow39 are putting pressure on service
providers to offer faster connections and deploy new wireline and wireless networks capable of
meeting demand. In short, faster and bigger capacity connections are essential. Internet trafc
grew by 7.4 per cent a month in Europe during 2007, a growth rate that is slowing down but is
still putting tremendous pressure on transmission capacities. Overall trafc in 2007 accounted
for 281 exabytes (exa – 10^18) of data, 50 per cent more than the previous year. Video
transmission took the biggest share of trafc growth and is likely to grow further. By 2011 the
level will be close to two zettabytes (zetta – 10^21)40. Meanwhile the unit price of transmission
In the next five years the
importance of data mining
will increase and will lead
the sales and marketing
activities of many companies
in the online environment

19 New communication behaviours in a Web 2.0 world
is declining on an annual basis and will continue to do so. Jim Cicconi of AT&T expects that,
without investment, the internet’s current network architecture will reach the limits of its
capacity by 2010. He predicts that $130 billion will be needed to bridge the gap. Trafc may in
fact increase fty-fold by 2015, following an unprecedented new wave of broadband trafc. This
increase will be driven both by greater penetration and also by vastly increased take-up of such
services as video streaming, virtual worlds and other services yet to emerge41.
New and even faster broadband technologies will clearly be required. For wireless access the
dominant technology might become mobile WiMax or extensions of current 3G systems. For
wireline it will most probably be optical cable transmission. This will be more widely deployed
around the world. Upload speed network capacities will need special attention, as upload is
becoming more important, having previously been neglected.
A new generation of devices will have to be deployed to meet the potential of higher speed
mobile internet network access42. It is expected that the devices will combine the functionalities
of current technologies. Rather like the iPhone, the devices will combine functionalities for
such services as voice, quality internet connection, multimedia and data storage and sharing,
multimedia playing, and easy transfer of les or multimedia content to friends. However, a large
group of consumers will still require only the traditional voice functions. Their need will be met
by simplied devices.
3.4 Enterprise 2.0 growth
Analysis indicates that the business Web 2.0 technologies43 market was valued at around
$764 million in 2008 and will grow to more than $4.6 billion by 201344. We rmly believe that
corporations will overcome their fears of implementing Web 2.0 into enterprise technology and
will make interactivity Web and peer-to-peer based software their main software applications.
The main benets the corporations will gain are cost savings in such areas
as IT development and software solutions, and improved knowledge sharing.
Usage of Application Programming Interfaces (APIs)45 and mash-ups
integrated into their corporate software platform (so called ‘productivity
tools’) will gain popularity. Companies will get better results from
collaboration either among their own employees, or between employees and
corporate partners.
Ease of adoption and use is another benet for the corporation.
Corporations will procure more software from open source environments, so
software solutions providers will have to adapt. As software companies and
individual software producers increasingly incorporate standard APIs into
their applications, complex portfolios will become more readily available for
corporate users to pick up and use. Many start-up companies are forming
today to serve these future customer needs.
Virtual world applications might nd a use in business processes too – as the equivalent of
the B2B internet. Some corporations are already exploring the potential for virtual meetings,
virtual training and virtual product shows with customers. In product development meanwhile,
3D computer-aided design is a well-developed concept that could nd further opportunities in
highly realistic virtual worlds.

20 New communication behaviours in a Web 2.0 world
Virtual worlds could also become a powerful platform for engaging customers in brand-focused
co-operation activities. Co-creation is a potentially powerful innovation mechanism; some
companies claim signicant R&D productivity improvements by involving the market at large
(and in particular the most engaged customers) in product creation. Virtual world members
appear to be more than willing participants in this new method of innovation.46
Enterprise 2.0 growth seems assured. The latest McKinsey survey shows that 80 per cent of the
companies globally that are interested in investing in Web 2.0 technologies and tools will be
adopting Web services in their operations. Almost half of those companies are going to adopt
collective intelligence and peer-to-peer networking tools over the next three years. Most plan to
use the technologies to manage collaboration internally (75 per cent of survey respondents), to
interface with customers (70 per cent) and to interface with suppliers and partners (70 per cent).
Corporations expect that these investments will not only bring access to new customers and new
markets and help to provide better customer services, but that they will also improve internal
knowledge management and product design and development47.
3.5 Web 2.0 going mobile
The mobile Web is rapidly becoming the preferred method of internet access. The growth of
Wireless Broadband Access (WBA) technologies such as 3G/UMTS/HSDPA, the migration
of traditional telecom networks to internet networks, and the availability of affordable and
functional Wi-Fi and dual mode Wi-Fi/mobile phones all boost VoIP over mobile broadband
internet. In fact ultimately they blur the distinction between xed and mobile services, since
both are becoming IP-based48.
Mobile devices will be used for multimedia communications. In this case, sharing and
collaboration between a collection of users is key to the adoption of Web 2.0 functions. Service
providers will therefore need to upgrade their network to allow an ‘always-
on’ experience. In addition, the capacity of the network will need to be
developed to meet the growing demand for data transmission. Networks will
also have to accommodate functionalities such as le sharing, multimedia
content streaming such as videos, music and podcasts, and storage.
Content providers will have to update their content for mobile devices,
adapting it to smaller screens and different ways of navigating within the site
than on personal computers. Handset providers will have to adapt to these
trends and provide handsets that can meet these demands.
All of which leads to a possible monetizing opportunity: transforming the
triple play into the mobile triple play by offering calling, TV and internet
on mobile as well as xed line phones. Most mobile devices are already able
to support two or all three parts of the triple play. However the quality and
accessibility of mobile internet and TV is not yet fully developed. Therefore
hybrid offerings (combining with internet and TV at home) will have to be
developed.