I can remember way back in the halcyon days of Web 1.0, when everyone was figuring out how to migrate old things into the new space, advertising, buying and selling and mail. The tools were expensive, as was bandwidth, if you could find it. Newbies were everywhere, passively and tentatively nibbling at content being pushed at them from above. Convergence was the buzz phrase du jour.

Among the “convergers” where the application service providers (ASP), who dangled the ultimate dream. We could access our applications and data whenever we wanted to and from wherever we were at the moment. Why should we own applications or even hard drives when we can simply let all of it live on a server and pay the company for as much as we use, sort of like our monthly telephone bill? Imagine, always having the latest version, while bottom lines grow with the cost savings and efficiencies gained by migrating key business functions, even databases to the ASP model.
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The possibilities seemed endless and so compelling that ASPs were the hot new thing in 1999. How quickly the other foot fell! Consider Pandesic, a B2B venture owned by SAP and INTEL that charged a growing number of e-commerce start-ups a paltry 2% of revenues to do their sales fulfillment. On July 28 2000, it summarily announced it was shuttering the business and handed out pink slips to its employees, because it could not see a timely road to profitability. How could this happen with powerhouses like SAP and INTEL behind the company?

How? Because Web 1.0 truly the beta version of what it can be. Everyone was trying to figure out how to do things. Technology costs were out of sight. Too few asked the critical question, “Even if we do solve the technical issues and find the bandwidth we need, is there any money in the play?” When got the answer in 2000, it was pretty clear that we had figured out at least some of the vision thing, but failed miserably when it came to executing on it.

Then in late 2005 the NY Times declared that we were witnessing the “Web's second coming, and it's even got a name, "Web 2.0'’ -- although exactly what that moniker stands for is the topic of debate in the technology industry. For most it signifies a new way of starting and running companies -- with less capital, more focus on the customer and a far more open business model when it comes to working with others. Archetypal Web 2.0 companies include Flickr, a photo sharing site; Bloglines, a blog reading service; and MySpace, a music and social networking site.

Where Web 1.0 was passive as “Internet companies” pushed content towards small and largely clueless audiences, Web 2.0 would be driven by user-generated content and increasingly savvy Net gnomes, almost all of whom have broadband access to the Net. Web 1.0 innovated and proved new business models and developed technology. Web 2.0 is optimizing it, as it leverages increasingly ubiquitous broadband, and technology that is all but free.

New categories are being created in the process as well. Consider Business2.0’s second annual list of twenty-five
Web 2.0 wannabes most likely to break out of the pack. Most striking to me are the categories, not so much the companies. Social media scores the top five slots followed by five ventures each in online video and mobile. Trailing behind the front runners are five advertising and five enterprise (new wave ASP) plays.

Whoa! We would have seen banner advertising plays on such a list in the Web 1.0 days, but social networking, mobile and video? Recall that online video was not even in play during the 2004 election season.

And how about Web 3.0? Well, consider what Kazaa and Skype founders, Friis’ and Zenstrom are creating with Joost, which offers “the magic of television with the power of the Internet built right in.” Where YouTube and Google are plagued by ever-larger broadband and content storage demands and costs, Joost is built on a Kazaa-like peer-to-peer platform that uses the community’s computers for storing and serving content. In the process, Joost has leaped past YouTube’s functionality by serving 30-minute full-screen Web 2.0 TV in virtually broadcast quality online.

What’s next? Stand by…