Page last updated at 00:26 GMT, Tuesday, 22 April 2008 01:26 UK

Web 2.0 is set for spending boom

By Maggie Shiels
BBC News, San Francisco

GM car
GM is among companies showing a keen interest in Web 2.0

Web 2.0 is set to be embraced by Enterprise 2.0 as businesses prepare to spend nearly $5 billion by 2013 on social networking tools.

Over half of the companies in North America and Europe see Web 2.0 as a priority for next year, a report says.

The news comes as San Francisco plays host to the Web 2.0 conference on next generation of the web.

"This is where we see the future of the web," said conference co-chair Jennifer Pahlka.

"The companies making announcements here are building that future."

Forrester, the research company which carried out the Web 2.0 survey, believes the technologies being developed and unveiled over the coming days represent "a fundamentally new way" for businesses to communicate with employees and customers.

Priority

The report found that consumer giants such as General Motors, McDonald's, Northwestern Mutual Life Insurance and Wells Fargo Bank will drive much of this growth and have already embraced tools like blogs, RSS feeds, podcasting and social networking.

Analyst Oliver Young estimates that another 56% of North American and European companies regard Web 2.0 to be a priority in 2008.

Eyeball reflecting Facebook logo
All Web 2.0 eyes are on San Francisco this week

"If I wanted to be anywhere in the Web 2.0 economy, I'd want to be on the enterprise side," says Mr Young.

Forrester analysed seven Web 2.0 categories: blogs, mashups, podcasting, RSS, social networking, widgets and wikis. Of these, social networks will attract the greatest levels of investment but even then that will be dwarfed by the multi million dollar revenues the software industry commands.

Mr Young says "Advertising revenue has been hard to come by with even sites such as Facebook finding it hard to monetise their high volumes of traffic.

"Companies are now looking over their shoulder to the business market where even revenues of $50 (25) per user per month are looking increasingly appealing"

He also points out that there will come a saturation point and investment will start to slow down as Web 2.0 applications become increasingly prevalent and absorbed into collaborative software packages.

'Disneyland for web nerds'

In the meantime, the world of business will get to see what is on offer in the Web 2.0 world as vendors take the wraps off a raft of products, services and applications during this week's conference in San Francisco.

Everything from the latest in cloud computing to blogging software and from mobile technology to rich media applications will be on show.

With around 7,000 people expected to attend, some bloggers have already nicknamed the conference a "five-day retreat to the Disneyland for grown-up web nerds".

Also taking part is a Web Mission from the UK which consists of more than 20 entrepreneurs looking to forge useful business connections and showcase British internet companies.

The businesses, which were selected from over 100 applicants, were chosen because they have the potential to expand into the US.


SEE ALSO
Learning what makes Facebook tick
21 Apr 08 |  Technology
Webscape
18 Apr 08 |  Click
Podcasting could be a revolution
20 May 05 |  Technology
The mash-up future of the web
19 Feb 07 |  Technology
Wikipedia takes business approach
15 Apr 08 |  Technology

RELATED INTERNET LINKS
The BBC is not responsible for the content of external internet sites


FEATURES, VIEWS, ANALYSIS
Has China's housing bubble burst?
How the world's oldest clove tree defied an empire
Why Royal Ballet principal Sergei Polunin quit

BBC navigation

BBC © 2014 The BBC is not responsible for the content of external sites. Read more.

This page is best viewed in an up-to-date web browser with style sheets (CSS) enabled. While you will be able to view the content of this page in your current browser, you will not be able to get the full visual experience. Please consider upgrading your browser software or enabling style sheets (CSS) if you are able to do so.

Americas Africa Europe Middle East South Asia Asia Pacific