Web 2.0 is advertising.
Forgive our play on the "Web 2.0 is People" mantra, but from a business perspective, the handful of Web 2.0 companies that are making money are doing so in the "Google" model, with good old-fashioned advertising. Reliance on that revenue stream may ultimately spell the end for some of the more high-profile Web 2.0 companies that are headed for copyright challenges from traditional publishers.
YouTube is in the news this morning as it faces two lawsuits -- one from an independent journalist and another from a L.A. news agency -- over postings of their copyrighted materials on the video-sharing service. And the lawsuit by a French news agency against Google News continues, despite motions to dismiss by Google's lawyers.
As a smart news item at PC Pro points out, advertising is conspicuously absent on YouTube.com. When the service tries to monetize its huge volumes of traffic through advertising, it will move from its legal status akin to an ISP to that of a publisher, creating a whole new layer of liability ranging from copyright infringement to libel.
Genuinely user-generated content is still wildly popular on the Internet, and millions of regular folks with camcorders are eager to share the materials they own with the world. However, YouTube made its big splash as users shared a Saturday Night Live clip -- many of the most popular items on it and other similar community content sites don't belong to the people who posted them.
We don't expect that bloggers will soon be afraid to quote long excerpts of other bloggers' posts. Certainly, IT Business Edge itself is largely in the business of digesting other sites' content and offering our users a high-level snapshot of what's going on out there on the Internet.
But we spend a lot of time and money making sure we comply with copyright standards. As Web 2.0 moves away from being a concept to an actual business model, the new breed of community publishers will have to do the same.