Bubble 2.0? I Don't See It.

John Dvorak's recent article in PC magazine, predicting the bursting of the Web 2.0 "bubble" started me thinking.. Is he right?

I started searching for the unbridled exuberance that was present with Web 1.0 (let's call it the E-Commerce era) - where venture capitalists would throw money at anyone doing anything on the Web. Expectations ran rampant - "clicks would replace bricks". Everything would be done over the web. Anyone could become the next Wal-Mart.

I don't see it today. Certainly there are well publicized acquisitions happening in the Web world, but acquisitions happen all the time in the non-web world as well - and they're lauded. Wall Street likes it "when deals get done".

Web 2.0 is all about social networking. Get as many eyeballs looking at your content and people will pay to place ads in front of those eyeballs. This article predicts that web based advertising will eclipse Newspaper advertising in 2011. Now agreed, 2011 is a long way off, but the trend is there.

Web 1.0 was all about expectations. There was no empirical data to be analyzed - only sales pitches. By contrast, today's sites easily measure page views, provide click trails and a whole host of information which can be analyzed to help determine online advertising effectiveness.

There may be some web company acquisition activity that on the surface, makes no sense to the average bystander. Some deals will fail and some will be successful - just like in the "real" world.

I think for the most part, rational market dynamics are in play and that there isn't any Web 2.0 bubble to burst.

Business done with clicks are subject to the same market dynamics as business done with bricks. They're one and the the same. Let's stop talking about them as if they were distant cousins.