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News and analysis of developments in the enterprise communication industry and market with primary focus on Europe.

The author aims to tap into ideas, insights and thoughts of the readers to get varied perspectives.

Views expressed in this blog are solely the author's opinion and in no way reflect those of his employer.

Friday, March 23, 2007

Uptake of web 2.0 apps within enterprises

There is a rise in user activism these days. Leveraging the scale and reach of internet, user-driven applications and services have created a new paradigm, sometimes referred to as web 2.0. The success of MySpace, Wikipedia, YouTube, Facebook and Orkut are some examples. Most of these developments have been in the consumer space, something that the enterprise market have been keenly watching for sometime.

The technologies that power web 2.0 phenomenon have had traction in the enterprise market. Collaboration, including Web services, peer-to-peer networking, blogs, podcasts, RSS, social networking, mash-ups amongst others have been tried and deployed within enterprises. Saying that the strategic direction in general has been towards adoption of technologies that enable automation and networking.

In one of McKinsey's recently published surveys, 79.3% of early adopters of web 2.0 applications were satisfied with the financial ROI over the past 5 years. Only 10% of respondents said they were dissatisfied. However the situation changed with fast followers. Only 59.5% of respondents claimed to be satisfied and 17.4% were disappointed.

One of the key challenges for web 2.0 apps has been to demonstrate value and put a price tag to it. Fortunately for the users of the internet, it allowed for unique experiences that led to a movement. Most of these applications came free of cost. In one of his visionary presentations, Cisco's Chief Development Officer, Charlie Giancarlo very nicely explained the changing lifestyle of the new generation. He explained with amusement that his daughter uses e-mail only when she wants to connect with him. The Google model created a new form of doing business. Internet gave it the platform and the market. Still the fundamental question of assigning a value to an application remains central and unresolved.

Today enterprise investment in web 2.0 apps is around creating another channel to interface with their customers, suppliers and partners. The advantages of the channel is around costs, transparency and collaboration. Enterprises derive significant in-tangible value from the use of these apps in managing internal collaboration. Value is derived from time-savings, resource management, collective intelligence amongst others. Lifestyle improvement at work is another driver that is at time overlooked.

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