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The TLDR: Since we don’t have a big headline story today, we are offering a guide to the hottest term in tech: Web3. Both die-hard lefties and free market libertarians love it. Investors are throwing oodles of money at it—both here in India and around the world. But what is it?
Editor’s note: This explainer was ‘commissioned’ by subscriber Shivangi Goel. We often do big stories on the request of our subscribers. So drop us a note at talktous@splainer.in if you have a topic in mind.
Web 1.0 and 2.0: A brief history
Web 1.0: Once upon a time, back in the 1990s and early 2000s, the internet was a collection of static web pages. You logged on and maybe read or bought a bunch of stuff, but there weren’t many ways for you to create content. And there wasn’t much money to be made off it.
Web 2.0: is the world we all live in now. This is when the tech giants like Google, Facebook, Apple, Amazon, Twitter etc. came along. We entered the era of giant platforms—where millions of people came together to post, share, shop at the same place. This had three big consequences.
One: Web 2.0 turned all of us into creators of content. Be it on TikTok or Instagram or Twitter, millions of people make the content—which is, however, monetised by these platforms in the form of advertising revenue.
Two: It allowed these companies to collect huge amounts of data on their users—and monetise them via advertising. So you get Google Maps, Google Search, Gmail for free. But you become the product—which Google then sells to companies. As Charles Silver writes in Forbes:
“Indeed, the internet has become a massive app store, dominated by centralized apps from Google, Facebook and Amazon, where everyone is trying to build an audience, collect data and monetize that data through targeted advertising. In my opinion, the centralization and exploitation of data, and the use of it without users’ meaningful consent, is built into Web 2.0’s business model.”
Three: It led to the centralisation of the internet in every sense of the word. Data is all collected in the cloud by a handful of companies. They make all the rules to decide who creates content, what kind of content is okay etc. And it has also concentrated great amounts of wealth in the hands of a few companies and their investors.
Quote to note: As one policy expert points out, Web 2.0 has not just become a data privacy nightmare for users, it has also stifled innovation:
“Right now, companies that own networks have unilateral power over important questions like who gets network access, how revenue is divided, what features are supported, how user data is secured, and so on. That makes it harder for startups, creators, and other groups to grow their internet presence because they must worry about centralised platforms changing the rules and taking away their audiences or profits.”
So how is Web 3.0 different?
Back to the future: The father of the internet—Tim Berners-Lee—envisioned the internet as a path to human freedom. And Web 3.0 is in many ways a return to original principles—the key among them being ‘decentralisation’: “No permission is needed from a central authority to post anything on the web, there is no central controlling node, and so no single point of failure … and no ‘kill switch’!”
Say hello to Web 3.0: Right now, everything you do on the internet requires an intermediary—a company which enables a transaction, allows you to share or search etc. This is also what allows these companies to collect data on you—and make money off it. Simply put, Web 3.0 aims to remove these middlemen:
“[I]nstead of users accessing the internet through services mediated by the likes of Google, Apple, or Facebook, it’s the individuals themselves who own and control pieces of the internet. Web3 does not require ‘permission,’ meaning that central authorities don’t dictate who uses what services, nor is there a need for ‘trust,’ referring to the idea that an intermediary does not need to facilitate virtual transactions between two or more parties.”
But how do we achieve all of this?
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