3 October, 2005 - 3:41pm

Tim O'Reilly, Founder & CEO of O'Reilly Media recently published an in-depth article laying out the design patterns and business models of Web 2.0. He gives an interesting perspective on the importance of data, which he likens to "the next Intel Inside". He notes that every significant internet application to date has been backed by a specialized database i.e. Google's web crawl, Amazon's database of products, and eBay's database of products and sellers. He believes however that the race is on to own certain classes of core data such as location, identity, and calendaring of public events. With respect to identity, he points to "startups like Sxip who are exploring the potential of federated identity in quest of a kind of 'distributed 1-click' that will provide a seamless Web 2.0 identity subsystem."

Tim concludes with an illuminating summary of core competencies of Web 2.0 companies:

• On-demand apps, with cost-effective scalability
• Control over unique, hard to recreate data sources that get richer as more people use them
• Trusting users as co-developers
• Harnessing collective intelligence
• Leveraging the long tail through customer self-service
• Software above the level of a single device
• Lightweight user interfaces, dev models, and business models