|By Frederick Felman Principle|
|January 06, 2022|
Avivah Litan, the storied Gartner analyst, laid it down succinctly for insiders in her blog two and one-half years ago. She said, “Web 3.0 will transform us from Web 2.0’s monetization via surveillance capitalism and advertising to monetization built directly into the protocol that is equally available to any connected user.” Translated, that means we’ll control our destiny by owning and managing our credentials for logging into systems, content, financial resources, and, importantly, our data. And, we are told, blockchain technology will enable all that.
Web3 is more than this clinical assessment. Harnessing blockchain and other new technologies, consumers will educate themselves and transact within the metaverse and via new augmented reality technologies. They’ll use both conventional and crypto-currencies to transact, collect and consume actual goods as well as digital versions of non-digital goods. And they’ll track and prove ownership of those goods via blockchain technologies.
If you are perplexed by the hype around Web 3.0 (Web3), join the club—Web3 and its potential applications are still emerging. And though some technology leaders and early adopters are well along the way to make elements of what will be Web3, and there are some examples of Web3 apps and sites, Web3 in whole is far from being realized and is the topic of debate and controversy. (Web3 site and app examples include Foundation – an NFT marketplace, Audius – a music streaming site, and Cosmos – a network of interconnected blockchains and services.)
The battle for control and definition of Web3 will be hard-fought because its objectives and monetization have a high impact on those that control and profit upon current Web 2.0 technologies and companies. The dramatic Twitter-hosted dispute between Twitter founder Jack Dorsey and Andreesen Horowitz, a venture capital firm well-known for its Web 2.0 investment successes, is a shining example of likely future battles as this innovation evolves.
In this blog, I’ll attempt to put Web3 in the context of Web 1.0 (a retronym) & Web 2.0, explain the objectives of Web3, and articulate the potential impact on brands and the intellectual property pros that defend them.
Web3 in the Context of 1.0 and 2.0
If you remember life without the Web and mobile devices, you know that everything we do on the internet and our phones used to be far more complicated and time-consuming. Web 1.0 was a static set of files that we could view, ever so clunkily, through rather primitive browsers. Interactions were limited, forms were prevalent, and weird error messages were the norm, not the exception. Most importantly, the rich interactive experience we appreciate now in the Web 2.0 world was impossible in the Web 1.0 world.
When Web 2.0 arrived, we began to appreciate what the Web could be. Relationships and transactions on the Internet and our mobile devices became possible. New technologies allowed us to more reliably create, view, and interact with user-generated content (UGC) like blog entries, photos, and videos on Flickr, Instagram, and YouTube. Sophisticated search engines like Google helped us find information, products, and content, while e-commerce platforms like eBay, Amazon, and Alibaba helped us buy things, mundane to exotic, sometimes from far-flung people and places, without even seeing them in person!
In unimaginable ways, Web 2.0 democratized communication. With applications enabled by Web 2.0, we could reach our closest friends instantly through chat applications, including WhatsApp and WeChat, and reach the world through social media platforms like Facebook and Twitter. However, convenience comes at a cost. The currency we’ve paid in for this convenience is our personal data and privacy.
Companies control interactions on Web 2.0 platforms, and they use our data to understand our desires, opinions, patterns of consumption, and other habits. Platforms and companies monetize our data through advertising, engagement, and even the sale of our anonymized personal data. It was so apparent that this was our Web 2.0 reality that in 2006 that Time Magazine declared “You” as the Person of the Year for the data we users represent and how it is used.
All of that stated, many folks probably think the enrichment and convenience of Web 2.0 outweigh these disadvantages. Legitimate businesses and the legislators who regulate them have sought to make Web 2.0 overall a clean, brightly-lit, and safe place for us to interact and transact. Through consumer protection and privacy regulation, most users enjoy a higher level of protection than they had earlier in the evolution of Web 2.0. Still, we find ourselves threatened by malicious actors who attack us and the platforms we trust through a gambit of seemingly age-old scams.
For almost everyone, Web3 is a future, not a present. Some of us may be directly using or unknowingly relying on emerging Web3 technologies like blockchain-based cryptocurrencies or Non-Fungible Tokens (NFTs), but Web3 isn’t implemented in whole cloth in the places accessible to the average user. For now, Web3 is essentially a collection of technologies, concepts, and application programming interfaces (APIs) used mainly by developers. The objectives of those working to make Web3 a reality are valiant. Web3 seeks to re-democratize and decentralize the Web – returning the Internet to its past promise by harnessing blockchain technologies. And, while that is likely an unintelligible mouthful of vague and confusing terms for most, I’ll try to break that down.
Each of us will have control over the “tokens” or digital representations of these assets in our own digital “wallet,”; we will allow limited access to those tokens and the underlying data or permission and those “transactions” will be recorded using blockchain technologies. Even the applications (called “smart contracts” in Web3) we use will be decentralized and controlled by us, the users. We will present a token that is our login for systems, and we will show tokens that represent fungible assets like cryptocurrency or non-fungible assets like digital art to exchange for other value. Our content will be available to those to whom we provide access and to no others. Content integrity will be recorded in the blockchain, so we’ll know where it’s passed, and everyone will be able to discern how it may have been altered.
The control and transparency provided by Web3 are expected to restore trust to the Web and herald a new age that re-establishes a democratic and decentralized online world. That’s the promise – but there are so many details of how this will play out that are still being defined. For example, if everything is decentralized, including applications that users control, how will people like me or our moms and dads be expected to control and manage this complexity? For many people, the current plethora of logins, credentials, and assets are difficult to manage, so this seems a tough hill to climb.
But the pursuit of Web3 should be worth the effort. Just as Web 2.0 revolutionized how we interact with the internet, information, our communities, and brands, Web3 will similarly change everything.
Web3 Implementation Considerations for Companies and their Brand Protection Organizations
Individual and commercial adoption of the technologies that underlie Web3 will be serial. We already see the adoption of cryptocurrencies and the acceleration of the use of NFTs in the Web 2.0 world. These two technologies are the basis for being able to exchange value in the distributed digital world of Web3, and the exchange of value is fundamental for the adoption of any new platform.
What brand protection organizations need to do now to protect their brands:
- Familiarize yourself with the terminology and technologies of Web3:
- Hype and acronyms of Web3
- Glossary of Web3 terms from developers’ perspective
- Web3 for investors
- Experiment with a crypto wallet (Motley Fool List, cNet List)
- Patrol the parts of Web3 that are already visible and consider registering your primary brands in NFT domain name TLDs
How should brands and brand protection organizations approach the adoption and protection of Web3 technologies?
- As with any new technology, the implementation and security of Web3 will be best if played as a team sport. Develop cross-functional Web3 risk mitigation strategies with legal, security, dev, customer success/service, and other stakeholders.
- Introducing new technology introduces risk in two ways—first, new vulnerabilities in the technology itself. Second, unfamiliarity with new technology makes users vulnerable to old scams hosted in new technologies. Imagine that everything old is new again—malicious actors and scammers will employ old scams in new ways, exploiting users’ unfamiliarity with new technologies. Be prepared to respond to both technical and user risks as they emerge.
In summary, the promise of Web3 is formidable – an online world based on trust where we users—not companies and platforms—control our online assets, including our data. As this migration to new platforms proceeds, we’ll see user confusion and bad actors targeting both the neophyte users who adopt Web3 and the companies that employ it. Being educated, staying ahead of the hype, and partnering with technologists, security professionals and business owners driving Web3 adoption in your organization will be important for brand protection professionals to anticipate problems and protect their customers.
By Frederick Felman, Principle