The next-generation Web experience is upon us, and the “Web 2.0” moniker is everywhere. Digit looked into the term, and what it means for the future of the Internet.

As the World Wide Web evolves into a more collaborative platform, the technologies and business models involved in that transition are being swept up into the "Web 2.0" rubric. It’s a term that’s vague enough to encompass almost anything you care to push under its banner.

However, it’s catchy in summing up the widespread sense that the Internet is at a tipping point.

The idea that the Web is transitioning to a new era is grounded in real-world examples. Beneath the hype generated by the concept are a growing number of pioneering sites that are offering new, collaborative services, underpinned by new business models.

IT publisher Tim O'Reilly, who coined the term for the debut Web 2.0 Conference in San Francisco in October 2004, was hard-pressed to define the term more concretely for the second conference. He resorted to offering a list of companies exemplifying the idea that the Web is evolving from a collection of sites controlled by individual publishers into an interactive platform.

Pioneering online advertising sales platform DoubleClick is a Web 1.0 service, according to O'Reilly. Google's open-to-all-publishers AdSense network is Web 2.0. Photo album hosting site Ofoto is Web 1.0, while the more interactive photo hosting and community site Flickr is Web 2.0. "Like many important concepts, Web 2.0 doesn't have a hard boundary, but rather, a gravitational core," O'Reilly says.

Photo call

Flickr illustrates the power of the new model, industry executives say.

"[Flickr] created an ecosystem and a phenomenon much larger than what you would expect a small team to be able to do," says Bradley Horowitz, the director of technology development for Yahoo.

Yahoo was so taken with Flickr that it bought Flickr's tiny parent company, Ludicorp Research & Development, last March for an undisclosed sum. It followed with a December buyout of del.icio.us, a community-focused bookmarking service that attracts the same kind of buzz Flickr earned.

The photo-sharing site launched in February 2004 and quickly built an audience attracted to its elegant interface and community features. Unlike more traditional photo-album sites, Flickr emphasizes sharing -- its style incorporates hooks popularized by blogs such as classification tags and reader comments.

The site also demonstrates the sophisticated resources developers now have access to: A group of less than a dozen people built Flickr, which uses the open-source PHP scripting language and runs on free MySQL database software.

Yahoo's portfolio of acquired applications also includes group events calendar site Upcoming.org, music playlists swap site Webjay, and blog updates tracker blo.gs.

Among media giants, Yahoo is jostling for the Web 2.0 vanguard position with its longtime search rival, Google.

Acquired taste

Google, too, keeps an acquisitive eye on promising startups. It shook up the blogging world in 2003 by purchasing Pyra Labs, a small venture that developed the popular Blogger service, and later picked up photo software developer Picasa to jump-start its photo-sharing services.

In May, Google acquired Dodgeball, a mobile social networking venture that lets cell-phone-toting users locate nearby Dodgeball-registered friends.

Dodgeball's founder, tech developer and analyst Dennis Crowley, began toying more than five years ago with ideas about connecting cell-phone users through social networking software.

When he and his partner Alex Rainert officially launched Dodgeball in mid-2004, the service quickly built a base of thousands of users in 22 US cities. But, had Dodgeball gone live a few years earlier, Crowley doesn't think it would have been as successful.

"Early on, it was so hard to get people to try things. No one was using their mobile Web browser; you couldn't text-message between carriers. A lot of those things are starting to resolve now," he says.

"I joke that one of the points where we knew Dodgeball was going to work was when my mom started sending me camera-phone messages, because it was easier than calling me. If my mom has this stuff figured out, then you know it's ready for prime time."

Google helped warm up the crowd. Its two-year-old Web mail service, Gmail, blew away the competition in bringing desktop-like functionality to an online application. The heaps of free storage Gmail offers has also helped it build a huge, fervent customer base. Google doesn't disclose its Gmail user count, but analysts estimate it's in the millions.

Gmail user Matthew Amster-Burton had muted expectations for online applications. He'd been frustrated before by other Web mail services, but Gmail quickly hooked him -- and from there, his Web reliance snowballed.

Web lifestyle

"After realizing how much I liked Gmail, I became open to the idea of using Web applications instead of desktop applications or post-it notes," Amster-Burton says. A food writer based in Seattle, Washington, he's adopted what he jokingly calls a "Web lifestyle."

While ubiquitous Web connectivity and powerful applications can ease users' lives in previously unimagined ways, breakthroughs require lots of experimenting -- and failure. The new technologies also carry new risks.

Security is an endless concern, but so are plain old reliability. The more a user entrusts essential data to Web applications, the more at-risk the user is when those applications fail.

As if to underline that point, a group of Web 2.0 poster children suffered a quick succession of crashes during a one week-long stretch in mid-December. Blog hosting service TypePad went down for an extended stretch after a failed storage upgrade, while del.icio.us users endured days without their online bookmarks after a data-center power loss wreaked havoc with the site.

Hosted-sales software provider Salesforce.com, a well-known evangelist for on-demand enterprise software systems, crashed for a day because of database glitches. This enraged customers who were rushing to close sales deals before the end of the year. Problems persisted into the New Year.

Other challenges loom as technology enables users to tap into exponentially expanding data stores and networks. IBM has hundreds of scientists studying analytics. One speculative project, WebFountain, uses complex software algorithms and a grid supercomputer with 40 racks of blade servers and network-attached storage hardware to tackle clients' trickiest data-mining problems.

Keeping human expertise on pace with advancing technology is an arms' race: "When we started this in 1999, I'd never heard of a blog, and now they dominate as one of the richest information sources," WebFountain chief scientist Dan Gruhl says.

Gruhl sees next-generation consumer technology leaping ahead of enterprise tools in innovation. "A lot of Web 1.0 was driven by people in professions that had access to information through sources like Nexis or Westlaw. We got spoiled with the ability to find information at work easily," he says. "Then it slipped. Enterprise tools drifted while consumer tools raced on. There are better tools for hobbyists than enterprises. [At IBM], we want to figure out how we can create enterprise equivalents to things like blogging? How can we do search better?"

Hype machine

Meanwhile, as new businesses and research projects get off the ground, the Web 2.0 hype grows. "It's one of those things that took off so fast, it loses its initial meaning," says Yahoo's Horowitz. "It's like the dot-com of this generation. Back then, if you were Pets Dot Com, your valuation went up. Now, if you're Photos Web 2.0, your valuation goes up. Yahoo has some of best talent and minds in the world to help us find the signal in the noise, but it's getting noisy."

Still, unexpected sparks can emerge from a field of static. Amster-Burton, the blogger and food writer, says the Web application he most covets right now would be a synchronization tool to mesh files from his laptop and desktop machines. He's tried a handful of available options, none of which impress him. But experience has taught him to be optimistic.

"The form is so limited and the competition is so fierce, if you're not doing something special online, no one's going to show up to play with it," he says. "I think someone is going to come up with an awesome solution to this problem. Something that is way more clever than I can imagine."