Reflections on Web 2.0

Before the Web 2.0 conference becomes a distant memory, I wanted to share why I am cautiously optimistic. I saw a lot of great software, especially around Ajax, and interesting new participatory content models. I liked the energy and experimentation, reminding me of the mid-90's. And I liked how Zoundry fit within the Web 2.0 themes of participation and community.

Here are two observations I took away from the conference:

1. Web 2.0 innovation is happening everywhere. This was nice to see since we're based in Connecticut. There are Flickr and Sxip in Vancouver. Look at Morfik in Australia. I met a co-founder of 20six, the largest blogging platform in Europe, and many other people from around the world.

This makes me want to expand our service internationally even sooner. We already have many users of our Blog Writer around the world and it pains me to tell them that our service is limited to the U.S. right now when they request account invitations. It's a matter of resources and we're looking at raising venture capital to help us grow faster.

2. Web 2.0 companies have real revenue models (mostly.) It's not just about users and eyeballs anymore. Google AdSense proved that you can monetize user-generated content and has given revenue models to Web 2.0 companies (until they can get bought by one of the portals.) Advertisers large and small love the pay-for-performance model of today's ads and are moving more of their advertising budgets online.

Affiliate marketing pioneered the concept of pay-for-performance, which is why it is still so popular today. Safa Rashtchy at PiperJaffray (who moderated the great teen panel at the conference) wrote in a Silk Road Weekly report the following 3 key points:

- Affiliate marketing remains the highest ROI channel.
- Paid search, contextual advertising, and affiliate marketing are not mutually exclusive.
- The affiliate marketing segment will grow approximately 30% in 2005.

We are extending affiliate marketing and making it more relevant to bloggers and other non-traditional publishers in the Web 2.0. I like the value we are creating by simplifying a proven marketing model and making it more accessible to more people. I want to thank again all of our users who have been helping us in this mission.

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