Imagine a new kind of Internet—one that's secure, decentralised, and free from the clutches of Silicon Valley behemoths. That's the promise of Web 3.0, considered the next evolution of the World Wide Web.
Web 3.0 has become the newest buzzword, and this article focuses on demystifying the concept. I'll explain the meaning of Web 3.0, evaluate the history behind it, and highlight implications for businesses. Let's dive in!
A (Brief) History of the Web
Thanks to technological advances and criticisms of the post-2000 Internet, the idea of a Web 3.0 has gained prominence in recent years. To understand Web 3.0, we must first understand its predecessors, Web 1.0 and Web 2.0:
Web 1.0 is the earliest version of the World Wide Web. Think of it as the Grandfather of the entire Web Web 1.0 was the Static Web: users could search and consume content via web pages, and that was it. Experts referred to Web 1.0 as "read-only" since users couldn't interact with website content.
Even with its flaws, Web 1.0 became a hit. For example, people could retrieve information online with ease and convenience for the first time. Businesses could also establish a digital footprint online and advertise to potential customers.
However, Homo Sapiens have never been ones to settle for less. So efforts geared towards creating the next iteration of the Web, Web 2.0, picked steam around the early 2000s. This preceded the dot-com boom and the introduction of Facebook, Google, Amazon, and other technology giants of the post-2000 era.
Web 2.0 was a step up from the static web pages of Web 1.0: users could now interact with content posted on websites. You could upload a video on YouTube, post a picture on Facebook, or comment under your crush's picture.
Introducing Web 2.0 brought about the content creator economy, where people shared content (blogs, videos, podcasts, etc.), and earned from their creative efforts.
Before long, Web 2.0 would face criticism as its predecessor—starting with data privacy issues. Previously, users were happy to exchange their data for access to free online services.
However, corporations providing these services built up giant collections of user data, which they sold or used to promote their business interests. They made billions in profit without paying a dime to the original owners.
Besides, the concentration of data in a few hands increased the risk of data theft. If hackers got their hands on a corporation's database, they could steal enormous amounts of data for malicious purposes.
We saw this play out with LinkedIn in 2012, Yahoo! in 2013, and MySpace in 2016. The monopolistic tendencies of the Big Five didn't help matters, either. Not only were they accused of stifling competition, but they confronted allegations of restricting customer choice through unfair practices.
With time, the call for a new type of Web, one closer to the original vision of Tim Berners Lee, grew.
What is Web 3.0 All About?
Web 3.0 is NOT the ultimate solution to the failings of Web 2.0. However, it corrects many of the issues identified with the existing infrastructure of the Web. Web 3.0 has its origins in a paper published by Tim Berners-Lee, creator of the Web, in 1991, where he proposed a version of the Web radically different from what we have today. This new version of the Web had the following characteristics
Web 2.0 stores data in central repositories, which was problematic for many reasons. It created behemoths and concentrated market control in the hands of minority owners. Also, it puts our data and use of the Web at risk.
In Web 3.0, data is stored on the blockchain, in "blocks" and "nodes" spread across a massive network of computers. No single computer or server contains all the data, promoting decentralized access and encouraging multiple failure points.
What if someone said you need permission before using the Web? You'd probably disagree. After all, Facebook, Reddit, WhatsApp, and other Internet services are free and available to use.
This is the illusion of control that plagues modern-day thinking. In reality, tech giants control how we use these services.
Imagine a user, Bob, needs to sign up for an online service. Bob must provide sensitive personal data before he can join the platform.
Then the provider will review Bob's request to use the service. And Bob may be barred from using a service if he lives in a particular location or refuses to provide sensitive data.
In a Web 3.0 world, you could join any network without requesting permission; all it takes is pushing some buttons. No need to compromise your privacy or change location before using a service.
Web 3.0 is a safer alternative to its sibling, Web 2.0. For example, decentralisation makes it harder for malicious individuals to access large amounts of data.
Users have greater control over their data. Customers can decide if they want to sell information about their Web usage or choose to remain anonymous.
How Will Web 3.0 Impact Business?
Web 3.0 uses blockchain technology, which also powers cryptocurrency, non-fungible tokens (NFTs), smart contracts, and decentralised apps (Dapps). If you know anything about blockchain, you know what Web 3.0 means excellent news for industries.
Here are some benefits of Web 3.0 for businesses:
Many applications are tethered to a particular OS (operating system). For example, some apps native to Apple's iOS cannot run on Google's Android. Similarly, Windows may restrict an application that would otherwise work on a Linux OS. Businesses must now create different versions of software to suit each operating system.
Web 3.0 solves this problem through decentralised apps (Dapps). These apps run on the blockchain, leveraging the power of peer-to-peer nodes (servers). These apps can run on any platform, saving costs and enhancing scalability.
Guarantee Data Safety
Before, people were okay with using online services in exchange for their data. They didn't necessarily care what happened to the data or who had access to it.
This is no longer the case.
People are concerned about the safety of their online information. And businesses would be foolhardy to ignore the growing clamour for safer data storage.
Web 3.0 can help companies store data safely and prevent breaches. On a blockchain, data blocks hold information across a vast network of computers. To access the entire network, hackers would need to access all the computers, which is difficult and cost-ineffective.
Use Smart Contracts
A smart contract is programmed to activate once specific conditions are met. Smart contracts got their start after Vitalik Buterin introduced his Ethereum blockchain.
To understand smart contracts, let's examine how contracts work currently. Say you signed an agreement to lease an apartment for three days. You'd need to meet the leaser, sign the document(s), and get keys to the apartment.
A smart contract in this scenario would work like this:
You sign the agreement online and get access codes once the program confirms payment. The software could also be programmed to reject your access codes once the agreed timeframe elapses.
All without the two parties meeting physically.
Smart contracts have other exciting applications, especially in the finance and insurance industries. An insurance provider could use smart contracts to power its settlement process and process claims faster.
Sell Tokenised Assets Via NFTs
With the noise about NFTs, only rock-dwellers haven't heard of them. Non-Fungible Tokens (NFTs) are pieces of digital content hosted on the blockchain. An NFT could be a video, audio, a photo, or any digital file.
While NFTs have become popular in gaming, businesses can exploit this advantage for greater profits. Your business may release an NFT associated with a product—to build awareness and excitement for the product launch.
Nike has plans for that already, filing applications to sell digital versions of its sneakers to in-game audiences. With Gen Z's purchasing power growing, NFTs provide the perfect opportunity to cash in and build a user base of young people.
Find Customers Online
The arrival of Web 3.0 is spurring the transformation of the Web into a Semantic Web. Semantic Web is an intelligent Web where AI-powered algorithms can "read" webpages and recommend tailored content to users.
This Web version encourages the use of "semantic metadata" to describe online content, making it easier for users to find information.
For your business, it means you can publish content that matches user intent instead of stuffing keywords to rank on Google. It means you can focus on providing as much detail about your content to search bots and make it easier to find your business.
Operate Across Borders
While international business has improved, it hasn't reached its full potential—partly because of restrictions on cross-border commercial activity.
Web 3.0 promotes a borderless and frictionless approach to business. With token payment systems, users can move money around quickly and pay for your services without delays associated with traditional banks.
Moreover, your business will expand to other countries when you can bypass government restrictions. Web 3.0 apps operate on a decentralised network, not a central server, making it difficult for authorities to shut down the service.
Build Businesses Easily
Big Tech's stranglehold on business continues because many smaller competitors, who may better serve users, cannot receive funding. Or, even if they received funding, majority shareholders can change the project's direction.
Introducing decentralized autonomous organisations (DAOs) in the Web 3.0 economy will change that. Unlike Web 2.0-era, equity-funded companies, DAOs receive funding from sales of tokens released at the organisation's inception.
DAOs discourage hierarchical control since every stakeholder has equal rights to vote via tokens. Besides, they make it easier for more people to invest in startups and share risk.
Web 3.0 is the future of business, and understanding how it works is crucial for entrepreneurs, companies, and corporations. With Web 3.0, companies can operate freely, scale faster, and provide a better experience for users.
The question is: will people take advantage, or will they miss out as they did on Bitcoin or the Internet?