Courtesy of freepik.com
It’s great to have complex topics broken down into easily understandable concepts. This is what this article is going to do for you.
If you can’t explain things in a simple concept so a regular person can comprehend, then you probably don’t have a great understanding of the topic yourself.
Key Features of Web 2.0
Web 2.0 is the internet infrastructure as we know it. Web 2.0 can be defined by social media, cloud computing, and mobile technology. With Web 2.0, APIs allow for interoperability between different software.
Everything functions well, but everything is centralized. You have to trust certain companies. And this has not turned out well for regular citizens with numerous data breaches and digital privacy intrusions. You don’t own your data with Web 2.0. It’s held on a third-party server.
Major Web 2.0 companies would include:
- Youtube
- UpWork
- AirBnB
- Fiverr
- Craigslist
- Uber
Obviously, these companies have completely transformed the way we live and work in the past 20 years or so. They were extremely useful advances. But now we are moving beyond them with the advent of Web 3.0.
Key Features of Web 3.0
Web 2.0 companies did a fantastic job of providing a given service, but often at the expense of digital privacy. These Web 2.0 companies also tend to create monopolies in their sector, leading to a host of associated problems.
But now, Web 3.0 is here, and such companies will have to adapt or they won’t survive. Web 3.0 removes the centralization issue and provides features that Web 2.0 can’t match.
Web 3.0 is not monopolized, so there are not really any central organizations that have captured the market. Web3.0 is essentially built on:
- Distributed Ledger Technology (i.e. blockchain)
- Artificial Intelligence
- Virtual Reality and Augmented Reality
- Machine Learning
- Self-Sovereign Identity (SSI)
- Decentralization (dApps)
- Individual Control of Data
All of these are topics worthy of their own article, so I won’t go into them here. The best way to explain this is with potential real-life use cases, given below.
Remember that the two defining features of Web 3.0 would be interactivity and interconnectedness. You are connected to everything without having to prove yourself to a central party that acts as an intermediary. This is a key point, though some could say that the marketplace/blockchain itself is the third party.
Web 3.0 Case Study #1 - Property Rental
AirBnB was a major market disruptor. Any person could set up a profile and rent their home for extra cash. It was a phenomenal success for both renters and homeowners. The only problem is... Airbnb.
As anybody who has used this platform for a long time can attest, the support does not seem to be the most ‘impartial’ in the event of problems. This is to be expected with a for-profit company looking to expand its presence.
A Web 3.0 platform can remove this issue. Imagine a decentralized rental marketplace built on a blockchain. You don’t have to meet the owners or even a receptionist because you can enter the home with your SSI or passcode for smart lock entry. An NFT can even be created for temporary ‘ownership’. Appliances could be connected to the blockchain in a smart home.
The review system would also be immutable, meaning that no centralized third party could remove it due to a violation of their (often nebulous) guidelines. If a renter stayed beyond their allocated time frame, their code/token would simply not work. Neither would the appliances.
Last, but certainly not least - the 15% fee charged by AirBnB would be replaced with something more in line with 1% - 5%. The fees would go down, but the quality of service would go up. This is what technology can do when used correctly.
Web 3.0 Case Study #2 - The Gig Economy
Web 2.0 companies like Upwork, TopTal, Freelancer.com, Fiverr, Craigslist, have enabled people to work from home and create new lifestyles for themselves. Just like the rental marketplace, these Web 2.0 companies have had an overwhelmingly positive influence.
But they are far from perfect. In 2019, UpWork introduced the concept of ‘connects’ where freelancers had to pay to apply for jobs. They called it a ‘restructuring’ to ‘benefit the marketplace’.
The result was that many freelancers were rejected from UpWork and many more could not afford to work. It also promoted the already successful/profitable freelancers who don’t care as much about these fees while discriminating against the newer freelancers, especially from less affluent regions.
Think about it: the world’s largest freelance marketplace can just eradicate all the newer and (perceived to be) lower quality freelancers that were not earning fees for the company, under the marketing umbrella of ‘improving the quality for all involved’. It certainly seemed to improve UpWork profit margins, if the 2020 financial reports are anything to go by!
The connect system is separate from the 20% fee for completed projects, as well as the VAT. This is quite a hefty price tag for a freelance platform. And it does not include the other 5% to 10% you will lose on PayPal currency conversions and withdrawal fees for those outside the USA.
Enter Web 3.0. Many DLT companies are looking to bring more equity into the gig marketplace. For instance, H3RO3S (pronounced ‘Heroes’) is looking to create a completely new marketplace aimed at students and freelancers.
These students and freelancers will complete jobs in their area based on their skills and preferences, earning up to $1,500 a month and without having to give a huge chunk of that to the system. Users have more autonomy about their earning potential and are treated more equitably, not as numbers to be profited from by a central party.
Web 3.0 Case Study #3 - Gaming
Web 3.0 is all about unification. And gaming is not quite what you would think in a Web 3.0 context. How do you describe a VR game where you get paid to play, can purchase NFTs worth millions of dollars, interact with other players, and enjoy the experience, without having to interact with a centralized third party? It’s a mix of work, pleasure, investment, and social interaction.
This is what certain Web 3.0 ecosystems are in the process of designing. Miami-based AEXLAB has created a 3D VR tactical shooter where NFTs of the in-game pets can be interacted with and grow new traits over time. This finally bridges the gap between Web 2.0 metaverses and blockchain technology. Meanwhile, Gamerse is probably one of the most prominent social gaming platforms out there that is set on unifying the fragmented NFT gaming ecosystem. It gives gamers a central hub to share, learn, and buy the latest NFTs. Current Web 2.0 platforms aren’t capable of bridging that gap. The most they can do is redirect the user to a different platform, like Opensea, that supports buying and selling.
The backdrop to all of these innovations in the gaming sector is a highly monopolized market. Valve is currently undergoing a lawsuit due to the alleged monopolization of Steam. Cited in the case was the fact that Valve owns 75% of the PC market. A hallmark of Web 3.0 gaming is a decentralized network where participants and game developers are involved and rewarded.
Again, while Steam provided an excellent user experience with digital rights management and social integration, it ultimately failed due to its centralization. Steam takes a whopping 30% from independent developers.
Why Web 3.0?
Hopefully, this has simplified things a little regarding Web 2.0 vs Web 3.0.
Web 3.0 is ultimately about fairness, equality, and efficiency. It’s going to make (and is making) the world a much better place across all industries.
Blockchain companies like Gamerse, AEXLAB, H3RO3S, and many others are paving the way for a decentralized, trustless, efficient, and fast Metaverse that will provide a fun and interactive experience for all.
It’s a brave new world, so don’t be afraid to get your feet wet and dive right in.
Disclaimer: The author holds tokens in some of the above-mentioned companies. The opinions in this article belong to the author alone and should not be considered investment advice.
