Interested in web3? The brilliant move from Facebook to Meta!
The renaming of Facebook to Meta tells you web3 is here to stay. Here’s why…
Have you ever heard the expression:
“If you don’t know what product you are buying, you are the product”
Whilst Facebook doesn’t sell your personal data directly, they use information about you to generate billions.
Now imagine a Facebook where every time you post, “like” or comment, you get paid. This is the promise of web3.
Founder’s letter
When Facebook's founder, Mark Zuckerberg, wrote his “Founder’s letter, 2021”, explaining the reason for re-branding Facebook to Meta, he left out some critical information.
Zuckerberg stated, “In the metaverse, you’ll be able to… work, learn, play, shop, create…”.
He seems to have left out “own” and “earn”, which is a central piece of the web3 paradigm.
In a web3 version of Facebook, users are paid for engaging with the platform. This is a threat to the current Facebook business model. The term used for these platforms is SocialFi (Social Finance) with projects like Torum and Weplay leading the way.
But what does web3 have to do with the Metaverse?
The “Metaverse” is a generic reference for moving beyond the real world (“Meta” — from Greek word for “beyond”) and into a more immersive digital world, combining elements of Virtual Reality (VR), Artificial Intelligence (AI) and the Internet of Things (IoT).
Web3 is an internet layer which enables ownership of digital assets and community building. The integration of web3 into the metaverse enhances the user experience through this control of personal digital assets.
NFTs (Non-Fungible Tokens) are already demonstrating the benefits of web3 enabled ownership. One of the simplest examples was a photographer who grew tired of enforcing copyright. The owner converted the digital asset (photograph) into an NFT and sold it for $300,000.
In web3, you control your data, you earn based on your contribution and you own your digital assets. This could be a serious threat to Facebook’s current model of selling your information to advertisers.
To figure out how we arrived at this point, it’s worth exploring what lead to web3.
The road to web3…
Evolution of the web can loosely be thought of as follows:
Web 1 — Read
Web 2 — Write / Share
Web3 — Own
Web 1 was the first widespread adoption of the internet and was focused mainly on reading online content like news, magazines and blogs.
Web 2 was built on third party platforms who benefited by charging a small fee for the platform (Software as a Service — commonly known as SaaS), or through monetising personal user’s data (Facebook, Google). These “trusted third parties” have extracted most of the wealth.
Web3 offers a way to reverse this dynamic and is changing the game by providing ownership without “trusted” third parties.
The evolution of the internet is an ongoing process, with no strict definitions of the transition from one phase to the next. 20/20 hindsight however gives us the ability to reverse engineer the evolution and to define some of the key differences.
web1, web2 and web 3 compared
Web3 — Own
The ability to assign ownership of digital assets using blockchain instead of relying on “trusted third parties” is at the core of web3 technology. Addition features include peer-to-peer value transfer (eg. Art, Money, Music) and community building.
Whilst one could argue that these functionalities are available in web2, the key difference is that they rely on a “trusted third party”.
For example, you may “own your frequent flyer points”, but only if the airline lets you. You can send money to another person, but only if the bank or payment provider lets you (and collects their fees along the way) and you can build communities, but only if Big Tech lets you (and you are happy to be censored).
Whilst the first use-cases for web3 in the “metaverse” are creating an improved user experience by enabling ownership and transfer of digital assets, the focus is now shifting to projects embracing real-world utility, enhancing existing business models and empowering users in the process.
Where to now?
Predicting the future is impossible, just look at some of the early Apple Macintosh advertisements showcasing a computer with a couple sitting around the kitchen table somewhat bemused.
The future for web3 looks bright when you consider the recent expanded integration of NFTs into Instagram and the rebranding of Facebook into Meta.
The ability to transfer value directly to another person, build communities and retain control of your personal digital data through blockchain instead of “trusted third parties” has Big Tech paying attention. Mainstream users are not far behind with projects embracing utility and benefiting customers in the process.
How can web3 improve your business model? Where do you think web3 will go? …besides web4.
We would love to hear your thoughts in the comments section.
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