Web 2.0 is mass market, Web 3.0 is the transformation of Industries in the long tail.

Techcrunch profiled 13 dating sites today.  It reminds me just how far ahead of the pack I am,  if you add all the other 12 dating sites profiles together excluding googlebase you will get close to the number of users currently logged into plentyoffish.com

Some of these sites are failures before even launching.  Sites like engage.com have taken 5 million plus in funding and for them to ever get that money back is extremely hard.   On the other hand you have 1 or 2 person sites profiled that have never taken money and if they earn 2k/month  they would be very happy the owners would consider it a success.  The VC funded ones will of course want 10 fold returns and if they don’t get it the site will be considered a failure.

It is kinda cool hearing many of these sites saying I was their inspiration for starting.  I remember creating my site like it was yesterday, and I remember the day adsense came out,  I added that to my site in the first few days.   As has been said elsewhere after that I kicked off the free site revolution.

I’ve inspired others to create great sites in other industries,  like this one.  I’ve also received emails from many developers saying they are now launching and building free sites to take over their little niche.  The free model funded by adsense is going to invade every conceivable maket and in many cases take them over. 

Mike of techcrunch has labeled many of these sites  web 2.0.  I think these are web 3.0 companies.   The poster children of web 2.0 have been agile teams like myspace, ficklr, youtube etc companies which have been transforming the extremely large niche’s.   What we are going to see next is small groups of people transforming the niches/Industries that make up the long tail. 

Running major sites on a staff of 1 or 2  is something that is been unheard of until this year.  The non vc funded sites profiled are run by only 1 or 2 people and its unlikely they will need many staff going forward.   Late 2006 and 2007 is going to be defined by startups offering free services monetized via adsense.   The “Free Site Revolution”  is going to turn many million dollar industries into  $50,000 a year industries.

I think we can sum up web 3.0 as  “Good bye Venture Capitalists” and good bye “Paid Services” and good luck existing if your company has more then 5-10 employees.

21 Responses to “Web 2.0 is mass market, Web 3.0 is the transformation of Industries in the long tail.”

  1. Yahoo! Ads Appearing In Ebay Search Results Says:

    […] On the topic of free competitors, The Paradigm Shift Blog has a provocative post about emerging Web 3.0 style companies: “The “Free Site Revolution”  is going to turn many million dollar industries into  $50,000 a year industries.  I think we can sum up web 3.0 as  ”Good bye Venture Capitalists” and good bye “Paid Services” and good luck existing if your company has more then 5-10 employees.” […]

  2. Brian B Says:

    Holy cow. No one can even agree on the definition of Web 2.0 and we already have Web 3.0 to argue about? Let’s put that one on hold till we finally agree on what Web 2.0 is.

    Seriously, I’m amazed at these websites that need teams of people to keep them up and running. I have Windows software packages that I’ve written for clients and ten years later those apps are still running and I haven’t had to fix a single bug. Why should a web app be any different? Write it to spec and leave it alone. Just keep the servers humming along and you’re good to go. Of course, these VC funded companies need teams of marketers to promote the site and teams of programmers to keep adding new features that most users will never use….

    The beauty of AdSense is that it makes it possible for the little guy to make money until he becomes a big player. On my AdSense site I contacted companies and they said I was too small for them to bother advertising on. So instead I tried AdSense and now I make a nice chunk of change. Of course, AdSense only pays out a VERY small percentage of their ad revenue as commision, but it gives you the chance to fund you site until it is big enough to command better advertisers (without the Google middleman getting his hands on it). What I’m waiting for now is someone to compete with AdSense so that they have to give a decent payout to keep your business. I have the same ads on the same pages day after day and my EPC are all over the place. It’s like a random number generator. Hopefully YPN or MSN will get enough advertisers on board to improve the situation for the content providers.

  3. Ali Says:

    Hi Marcus.
    I’m curious about what your opinion is on 37signals (http://www.37signals.com). If you were to take ownership of that company today, will you release all of their products for free and monetize using google adsense, or will you continue to sell them on a subscription basis? (If you don’t already know, their products are free to use, but for some features they require monthly payments which range from $10-149 or something like that, depending on how many features you want to use.)

  4. Ed Says:

    Many say that Adsense has ruin the Internet and i say this is 100% false. Adsense has increased the qulity of the Internet because people now make quality content and service for free because of Adsense. I mean without Adsense people are not going to create good websites because they are not going to get paid.

  5. Markus Says:

    ALi, things like project management, office etc are all are, or going to become commodity products. How many times can you really add more features or improve a product. There is a point in time where it will be feature complete.

    37signals is already giving away basic use for free and its only a matter of time till someone else comes along and gives away an entire product for free and open source it. Its not a industry that I would want to be in going forward.

  6. James J. Says:

    Regarding 37Signals, that has actually already happed:


    Do you think there is value in the salesforce.com model of web based hosted applications? Because that’s basically what 37Signals is doing at this point.

  7. Ali Says:

    Hey Markus,
    thanks for answering the question. One more thing..
    I’m in the process of making a web app which will be similar to 37signals products. (Its not in the same industry/market, but its technically similar to Basecamp and other products in that its a web app and people will have to get an account in order to use it. If you want to see what its about, take a look at my site.)

    Should I make it completely free and monetize using google adsense, or offer a 37signals kind of monthly subscription model (for every cheap, about $5/month)? I heard Google Adsense’s TOS don’t allow ads to be displaying in a software’s interface. And since my thing will be a software, will that rule apply to me?
    Whats your take on this?

  8. Richard Says:

    How many employees do you have if you count your volunteer mods? How many sites and/or services will be able to build a community of that passion or size where people will be willing to do the client/customer/visitor support for free?

    Adwords are great and they allow a lot of sites to cover costs, but they are very dependant on the amount of page views that you can serve up.

    The problem is, what if new technologies are attractive enough to users (not just developers) that they turn turn million page view a day sites into 50,000 page view a day sites?

  9. TolleSolle Says:

    Hey fellows, we are trying to study some of these trends and come up with a niche community here in Silly Valley. Any ideas on more research for http://www.emergingstartups.com

    shoot me an email if you can. thanks

  10. Web 3.0 Here Already at LifeMeta Says:

    […] Here is what Markus, the owner of Plentyoffish.com has to say about Web 3.0: Running major sites on a staff of 1 or 2 […]

  11. Grant Says:

    Come on to your senses, people! There are product niches that will always remain paid. Adsense can power personal projects, small ventures, communities, informational sites and similar stuff, but it can not be a part of a business-oriented application. Of course you will power the free, public version of your product with it, but really, can you even imagine a multi million dollar business using Adsense powered service when talking about corporate management? Adsense created a new era in web business, for sure, but please make a difference. Moreover, will any of you consider putting Adsense blocks on their corporate site, then stand up and claim they are respectable company that is serious about business?! This is a complete overreaction already. Adsense has a huge arsenal of benefits, but they are definitelly out of question when talking about business applications and proper corporate identity.

  12. The Yourdon Report » Blog Archive » Web 2.0 mind-map, version v016 Says:

    […] I reorganized and expanded the materials on the “Trends” page of the mind-map, and it now has about three dozen links and references to such things as the difficulties of making predictions about trends; the resistance to “paradigm shifts” by society and scientists; a couple of comments about what Web 3.0 will be all about, including a link to a list of cool Web 3.0 apps, and a link to my summary of Kevin Kelly’s keynote address at the Amsterdam NextWeb conference at the beginning of this month; some comments about the ramifications of Moore’s Law on the technological trends of Web 2.0; some comments on likely business trends going forward from today’s Web 2.0; and some comments on likely cultural/social trends going forward from today’s Web 2.0. You’ll find lots of stuff to read about and think about on this new page of the mind-map. […]

  13. The Yourdon Report » Blog Archive » Web 2.0 mind-map, version v013 Says:

    […] In the “Trends” section of the mind-map, I added a blog posting that suggests the characteristics we should look for in Web 3.0 (as if we’ve really figured out what Web 2.0 is all about!) […]

  14. unitstep.net Says:

    How “web 2.0″ is actually changing things

    With all the talk about how Digg, the community social news site, is supposedly worth $200 million, and the ensuing cries of BS, you’d think we were well on the way to Bubble 2.0 instead of web 2.0. Semantics of the “web 2.0″ term as…

  15. Error Forum Blog » Blog Archive » Yahoo! Ads Appearing In Ebay Search Results Says:

    […] the topic of free competitors, The Paradigm Shift Blog has a provocative post about emerging Web 3.0 style companies: “The “Free Site Revolution”  […]

  16. Andrew Scott Says:

    Markus, congratulations on your incredibly succesful website; however it seems enthusiastic of you to claim you started the free site revolution. There have been plenty of free sites on the web since the Internet’s inception – indeed plenty of services predating plentyoffish were free.

    That aside, I’d also suggest that Web 3.0 is more about the intelligent manipulation of data – Serving results to user in context, with context. Its less about business models and more about the way websites interact with users, in that services should suggest to users what they want with context to what they are doing, where they are, who they are, and what they like.

    Consider this example; if I was a single mum with a 7 year old child, currently I’d have to search seperately for ‘cheap hotel in spain’ if i wanted to go on holiday there, and then work out from reviews on a hotel-review community site, which hotel might be best – or ask someone a question in a blog. Web 3.0 should mean that it KNOWS what hotel type I want, or atleast when i ask in Google 3.0 “hotel in spain for a single mum” that I need a hotel that is suitable for children (because Im a single mum) that I maybe want it cheap (for the same reason) and that the hotel should have daycare .. etc. etc. Thats Web 3.0, in my hummble opinion …😉

  17. Luke Harvey-Palmer Says:

    Bring this on…I can see this evolving, but feel it may be a while away. I am still shocked each week by ANOTHER magazine launch, or another crappy TV show launch? The excitement is in the pace at which we are evolving toward 3.0…

  18. led Says:

    well, with web 3.0 you could find the needle in the haystack. the search will be pinpointed to the query, this will happen in web 3.0

  19. Benton Slanker Says:

    Thanks for the useful post like this C I had fun reading it! I always love your blog. Have a excellent day!

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  21. Shane Weng Says:

    Thanks for the post. This post describe web 3.0 in a different way. Other people described web 3.0 as semantic web or Web 3.0=(4C + P + VS) .

    p.s. “combining content, commerce, community, and context, with personalization and vertical search. Or, to put in a handy phrase: Web 3.0=(4C + P + VS)”

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