the web 2.0 bubble

As a veteran of the Aussie internet industry the first time around, the so-called "web 2.0" opportunity being feverishly pursued by seemingly everybody - from giants (News Corp) to tiny Aussie businesses (gnoos.com.au, Ansearch etc) - reminds me of "web 1.0" (and other bubbles through history) in a few important ways:

1. a business opportunity is neither good nor bad simply because it is "web 2.0" - it is good or bad based on its potential (short or long term) to generate profits for shareholders.
2. a business is not web 2.0 just because it says it is (the same way that a business was not an "internet business just because it says it is). Do any Australians reading this remember Seafood Online or Jumbomall? Do the Americans remember Kozmo? The Europeans remember boo?
3. It strikes me that the intersection of community / localisation / user-generated content / genuine interactivity of environment / etc / etc /etc is genuinely exciting, in that it offers new opportunities for people to communicate, collaborate (and transact!). The 'old' internet businesses also provided genuine innovations in communication, collaboration and transactivity - the problem was that valuations were unsustainable and it became difficult to separate the wheat from the chaff.

In summary, I believe web 2.0 is a bubble BUT this is not meant as a diss to the good businesses in the sector. It is a statement that the sector is attracting bottom-feeders, mining-industry speculators and assorted opportunists. This increases the challenge for the genuine pioneers to differentiate themselves and not lose momentum or control of the (huge) opportunity.