Over the nearly 40 years since its official birth date, the Internet has undergone several evolutions. Distributed ledger technologies - of which blockchain is perhaps the best known - have made it possible to envision a new model of the internet: web 3.0. In this model, companies and people become "co-owners" of the web. What implications will this new paradigm have for incumbents and what opportunities will it bring for the average user?

On January 1st 2023 we will celebrate the 40th anniversary of the birth of the Internet, marked by the day the TCP/IP protocol was adopted. Without going into great detail, we talk about the set of rules and procedures that allow all networked devices to communicate: how information is transmitted, received and read, regardless of the device, its manufacturer, location or any other characteristics. It is thanks to this and other protocols that we can send emails, access websites, send photos, make purchases, video calls, among many other things. But that is today. So far, the history of the Internet has been written in two major chapters: a first period, which runs from 1991 to 2004, which is traditionally called web 1.0, and the following years until today: the web 2.0.

Web 1.0, the advent of the world wide web, was marked mostly by websites, of all shapes and forms, eminently static, in which the user could, above all, read information. Web 2.0, on the other hand, brought the read and create logic: beyond what was already possible before, users could now create and upload content to websites and have a new and expanded set of online interactions. This version of the Internet created most of the technological giants we know, brought new business models, professions, products, regulation, services, and a degree of integration and proximity that had never been achieved in human history. However, it also subverted a fundamental principle of the previous era: the Internet no longer belongs to everyone. While in web 1.0 part of the Internet's infrastructure - its protocols, of course - was governed in a decentralized way by communities of volunteers, since 2004 our online life is mediated by large technology companies that consume our data and our attention, making extraordinary revenues, creating a large market concentration at the expense of several acquisitions of smaller competitors.

The popularization, in recent years, of distributed ledger technologies, of which blockchain is the best known, has created the ambition that the Internet can once again belong to everyone - the so-called web 3.0. The blockchain, as initially foreseen in Bitcoin's technical document, allows the creation of an online transaction and information registration system, distributed in a decentralized network - that is, one that does not belong to a single entity - governed by an incentive model to attract and keep those who want to be part of it. The innovation that was created in the following years made it possible to start thinking of the internet as a space where, besides seeing and creating information, one could also hold information. By information we mean, of course, virtual money (Bitcoin, Ethereum or other currencies that have been appearing), but also digital assets such as images, audio, domains, and even real estate.

This combination of blockchain technology and incentive model has laid the foundations for the so-called token economy. In this new digital economy, platforms and services are owned by all those who want to participate, thus deciding together the course that projects take. There are interesting examples: Helium has been investing in the creation of a wireless network for IoT devices, which is secured by anyone who wants to participate. Uniswap, one of the most popular Decentralized Finance platforms , makes all its governance decisions by voting, in which all token holders of the platform participate. And we could cite many other examples, with their virtues and vices, that have been materializing the first experiences of Decentralized Autonomous Organizations (DAOs).

It may seem counterintuitive but this model brings potential opportunities for companies: user bases become communities, in which each one is involved in the success of the project, because the success of their investment also depends on it. This creates a movement of co-responsibility between companies and their promoters.

As has been the subject of our reflections, the world continues to describe a route of accentuated digitalization. Perhaps foreseeing that in this trend, future consumers will place equal value on holding digital and physical assets, Nike bought RTFKT, a studio that creates digital sneakers, in 2021, through which it has been launching collections of digital sneakers with the potential to be worn in the metaverse.

However, Web 3.0, like so many other technological waves before it, can be regarded with suspicion by most established companies. The courage to experiment can represent a great competitive advantage, essential in the long run. Several "traditional" companies have taken small steps in this direction, from virtual currency payments, the integration of virtual wallets with social media profiles , and even exclusive editions of digital collectibles. These are companies that have not radically changed their business and operational model, but have chosen to conduct limited experiments in this area (some even call this intermediate reality web 2.5), to test new revenue models, market relations, and online presence.

Fundamentally, in this new digital economy, companies no longer extract attention and value from their users and their data, making them co-owners of their services and the value they generate. In the philosophical dimension of web 3.0, such ambition wants to represent a fairer and more democratized Internet, which is no longer in the hands of a few. An Internet more equal in access and opportunities. This is a narrative that has been gaining momentum, but is still in its infancy. As such, it is fertile ground for disruptive innovation, for new opportunities, but also for the replication of the vices inherent to our human condition: fraud, plutocracy, illicit funding, and all sorts of other morally or legally reprehensible manifestations.

Are these reasons to immediately cease the activities of this new industry? I don't think so, but it is a case of continuing to reflect together on what we have learned over the past 40 years of the Internet, so that this third iteration of the global network that connects us daily can be better.

ÔÇŹ

This text is a republication of an article first published in Exam - read the original here.

Do you know our program:
Leading the Digital Transformation?
Published in 
22/11/2022
 in the area of 
Digital & Technology

More articles from

Digital & Technology

VIEW ALL

Join Our Newsletter and Get the Latest
Posts to Your Inbox

No spam ever. Read our Privacy Policy
Thank you! Your submission has been received!
Oops! Something went wrong while submitting the form.