A more homogeneous, decentralized and democratized Internet
A concept currently circulating on the Internet and generating equal parts hype and speculation is Web 3.0. Various pundits have weighed in, trying to define what it is and isn’t – however, what is certain is that Web 3.0 will be a decentralized ecosystem where infrastructure creators will own their data. The days of a server and a database are over, as Web 3.0 will evolve into a seamless way to connect people and devices seamlessly. But, to understand the implications of this transformation, it is important to go back to the ancestors of Web 3.0.
In the beginning, there was Web 1.0, which was above all a means of sharing and using information on static pages. With Web 2.0 came the advent of social media and started the era of user-generated content. What united these previous iterations was that the data was stored on servers owned by large companies and institutions. Even if the user was the original creator of the data, he was ultimately not the true owner. Although Web 3.0 has not fully taken shape, it will have significant implications for the way business is conducted because it is – unlike in the past – decentralized and uncontrolled by governments and corporations.
Centralized vs Decentralized
The internet was first structured around single-server ownership because it was the easiest way to build network infrastructure. Still to this day, the data is, in most cases, stored on a server or a cluster of servers in the cloud. And these servers belong to companies that manage data on behalf of users and even other companies. Web 3.0 will break this paradigm by moving from one server to many different, decentralized servers; as Berners-Lee envisioned, Web 3.0 will create a universal space not governed by a central authority.
Many believe that blockchain will be the “essential” enabler of Web 3.0 when it comes to decentralization. The blockchain will enable encryption and distribution computing, which means that data stored on a blockchain can only be accessed by authorized individuals. Essentially, the owner of the data will be the only one in control, i.e. the user. In addition, blockchain allows people and businesses to interact without intermediaries or third parties. A trustless transaction between two parties is best represented in exchanging Bitcoin directly with another person. However, since the Internet will theoretically no longer be owned by a central custodian, society will need to find a balance between trust and truth.
If blockchain technology plays a central role in the development of Web 3.0, we could see cryptocurrencies seamlessly integrate into the digital payment system. Decentralized ledger technology could also be used to democratize the world of digital content and protect copyrights by giving everyone the ability to create and monetize their content.
Some have speculated that Web 3.0 would be a potential solution to the hegemony of “big tech companies,” such as Google, Amazon and Microsoft, which together own more than 50% of all data centers. While someone may argue the importance of centralized data to safeguard the truth and prevent the spread of harmful or inappropriate content, others posit that the data can be easily manipulated because it is so centralized. Currently, in the Web 2.0 model, if a system administrator wanted to tamper with data on a server, they could hypothetically do so, and no one would know anymore. But, with Web 3.0, centralized companies no longer own or control data, as it is managed privately. Additionally, there would be multiple servers, each with copies of the same data but overseen by different people or companies. Likewise, users cannot predict which server they would join even if they keep the same set of data. This unpredictability is necessary because an administrator cannot manipulate the data without making it very obvious because the information would no longer match other servers. And by not having a centralized party generating the dominant opinion, it democratizes the web.
Nevertheless, the implications of Web 3.0 raise some questions about the inherent lack of oversight and control in terms of security and legality; some believe the Internet could become something akin to the “Wild West”. Likewise, despite the excitement of a decentralized internet, many wonder if it will be as free as people think. Big tech is unlikely to allow their monopoly to end so easily – already several large corporations and venture capitalists have started pumping money into Web 3.0.
A major misconception is that the Metaverse and Web 3.0 are the same. In reality, the metaverse is just users interacting with the presentation/interactive layer, whereas Web 3.0 is the whole architecture with each level decentralized.
How Web 3.0 Will Affect Business Models
Web 3.0 will revolutionize the way businesses interact with their customers, so much so that they may need to build an entirely new infrastructure to adapt. New channels will need to be created for potential revenue streams, especially curated content, products, and experiences. Web 3.0 will give businesses direct access to end users, forcing many to rethink what omnichannel really means.
Currently, businesses face significant challenges in customer segmentation, but with Web 3.0, customers can effortlessly and purposefully share their information with the brands of their choice, making the customer experience even more personalized. By adding AI and machine learning to decentralized data structures, brands can do more than just targeted advertising – for healthcare, in particular, a company could design a drug designed solely from data from… ‘a patient.
In many cases, users will collectively contribute to the creation of the product, being fairly compensated for their contribution as co-investors and creators with no central authority authorizing payments. Based on various DAO models and smart contracts, the direct link between end use/revenue and creation contribution can be established without any management party involved.
A realistic point of view
It will take time to understand the full potential of Web 3.0, and there is still a lot of research and development needed before it becomes a reality. And many obstacles stand in the way, such as the reluctance of big tech to give up its dominance. Nevertheless, Web 3.0 will completely change the way businesses and consumers interact online.