You are previewing Web 2.0: A Strategy Guide.
O'Reilly logo
Web 2.0: A Strategy Guide

Book Description

Web 2.0 makes headlines, but how does it make money? This concise guide explains what's different about Web 2.0 and how those differences can improve your company's bottom line. Whether you're an executive plotting the next move, a small business owner looking to expand, or an entrepreneur planning a startup, Web 2.0: A Strategy Guide illustrates through real-life examples how businesses, large and small, are creating new opportunities on today's Web. This book is about strategy. Rather than focus on the technology, the examples concentrate on its effect. You will learn that creating a Web 2.0 business, or integrating Web 2.0 strategies with your existing business, means creating places online where people like to come together to share what they think, see, and do. When people come together over the Web, the result can be much more than the sum of the parts. The customers themselves help build the site, as old-fashioned "word of mouth" becomes hypergrowth. Web 2.0: A Strategy Guide demonstrates the power of this new paradigm by examining how:

  • Flickr, a classic user-driven business, created value for itself by helping users create their own value

  • Google made money with a model based on free search, and changed the rules for doing business on the Web-opening opportunities you can take advantage of

  • Social network effects can support a business-ever wonder how FaceBook grew so quickly?

  • Businesses like Amazon tap into the Web as a source of indirect revenue, using creative new approaches to monetize the investments they've made in the Web

Written by Amy Shuen, an authority on Silicon Valley business models and innovation economics, Web 2.0: A Strategy Guide explains how to transform your business by looking at specific practices for integrating Web 2.0 with what you do. If you're executing business strategy and want to know how the Web is changing business, this book is for you.

Table of Contents

  1. Dedication
  2. Special Upgrade Offer
  3. Foreword
  4. Preface
    1. What Is Web 2.0?
    2. Who Is This Book For
    3. What You’ll Learn
    4. Implementing Web 2.0
    5. How to Contact Us
    6. Safari™ Books Online
    7. Acknowledgments
  5. 1. Users Create Value
    1. Flickr and Collective User Value
      1. Collective User Value and Positive Network Effects
      2. Trusted Context for Interaction and Community
      3. Reaching, Tagging, and Monetizing the Long Tail
    2. Six Ways Flickr Created User Value Through Interaction
      1. Open Up Digital Content to Global User Interaction
      2. Create Better Search Through User-Generated Information
      3. Discover and Explore Through Online Groups
      4. Catalyze and Amplify Group Social Network Effects
      5. DIY Self-Service Syndication
      6. Encourage Others to Become Part of Your Digital Ecosystem
    3. Why Sharing Can Be Profitable
    4. Flickr’s Cost Drivers
    5. Calculating Company Value
    6. Looking Back: Netflix’s Different Challenges
      1. The Costs of Growth
      2. Escaping the Trap
    7. Lessons Learned
      1. Customer Acquisition Costs, Inventory, and Growth Rate
      2. Cash Flow Curves and Time to Profitability
      3. Company Financial Valuation
      4. Entrepreneur/Founders’ Net Worth at Exit
    8. Questions to Ask
      1. Strategic Questions
      2. Tactical Questions
  6. 2. Networks Multiply Effects
    1. Web-Enabled Online Network Effects
    2. N-Sided Markets
    3. Google’s Combination of Network Effects
      1. Demand-Side Network Effects and Critical Mass
      2. Getting Advertisers to Pay for Keywords: GoTo
      3. Google’s Entry
        1. PageRanking optimization of organic search
        2. AdWords: A self-service way of reaching the long tail of search query
        3. AdRank to determine advertisement positioning
        4. Compounding network effects
        5. Blogging for dollars
    4. The Ups and Downs of Positive Feedback
      1. The AOL/Google Story
    5. Lessons Learned
    6. Questions to Ask
      1. Strategic Questions
      2. Tactical Questions
  7. 3. People Build Connections
    1. Social Roles: Online and Offline
    2. How Online Changes Social Networking
      1. The Shift from Snailmail to Hotmail
      2. Connectors, Mavens, and Salesmen at Broadband Speed
    3. How Many Customers and How Quickly?
      1. Rogers Adoption Curve
      2. The Bass Diffusion Curve
    4. LinkedIn: The Rolodex Moves Online
      1. Rapid Growth
      2. Trust and Degrees of Separation
      3. Monetizing Social Networks
    5. Facebook: Introduce Yourself Online
      1. Facebook’s Initial Growth
      2. Viral Growth at Facebook
      3. Viral Applications
      4. The Limits of Viral: Facebook Beacon
    6. Lessons Learned
      1. Climbing Social Networks
      2. Value Generation in Social Networks
      3. Acceleration
    7. Questions to Ask
      1. Strategic Questions
      2. Tactical Questions
  8. 4. Companies Capitalize Competences
    1. External and Internal Forces
    2. Developing Dynamic Capabilities: Before the Web
    3. From Online Syndication to Competence Syndication
      1. Software as a Service (SaaS)
      2. Finding Competence Across the World: IBM
        1. Integrating Linux and Apache
        2. Mentoring
        3. Ecosystems and competence syndication
      3. Giving Away the Store: Amazon
        1. First steps: letting other sellers into the store
        2. Next steps: sharing back-office competences
        3. Helping others share competences
      4. Encouraging Competence Mashups: Google
    4. Lessons Learned
    5. Questions to Ask
      1. Strategic Questions
      2. Tactical Questions
  9. 5. New Recombines with Old
    1. Styles of Innovation
      1. Competitive or Collaborative Innovation?
      2. Styles of Collaborative Innovation
      3. Democratized Innovation
      4. Crowdsourcing Innovation
      5. Open Source, Ecosystem, and Platform Innovation
      6. Online Recombinant Innovation
      7. Bridging, Not Disrupting
    2. Integrating Ecosystems: Apple’s iPod
      1. Platform Innovation Ecosystem #1: Production
      2. Platform Innovation Ecosystem #2: Creative and Media
      3. Platform Innovation Ecosystem #3: Accessories
      4. Platform Innovation Ecosystem #4: User-Provided Metadata
      5. Recombinant Innovation
    3. Working with the Carriers: Jajah
      1. The User Experience
      2. Alliances Make It Work
    4. More Recombinant Innovation: The iPhone
    5. Lessons Learned
    6. Questions to Ask
      1. Strategic Questions
      2. Tactical Questions
  10. 6. Businesses Incorporate Strategies
    1. Five Steps to Web 2.0
      1. Build on Collective User Value
      2. Activate Network Effects
      3. Work Through Social Networks
      4. Dynamically Syndicate Competence
      5. Recombine Innovations
    2. Building Web 2.0 Business Plans
      1. Market Analysis
      2. Competitive Analysis
      3. Products and Services
      4. Time Line and Milestones
      5. Management and Executive Team
      6. Financials
    3. Look Around While Moving Forward
  11. End Notes
    1. Chapter 1
    2. Chapter 2
    3. Chapter 3
    4. Chapter 4
    5. Chapter 5
    6. Chapter 6
  12. Bibliography
  13. Index
  14. Special Upgrade Offer
  15. Copyright