Wednesday, August 6, 2008

Welcome to Web 3.0: Now Your Other Computer is a Data Center

This guest post is written by Marc Benioff, chairman and CEO of He has been widely recognized for pioneering innovation with honors such as the 2007 Ernst & Young Entrepreneur of the Year, the SDForum Visionary Award, Alumni Entrepreneur of the Year by the University of Southern California (USC) Marshall School of Business, and being ranked No. 7 on the Top 100 Most Influential People in IT survey by eWEEK.

For almost ten years now, we have been witnessing a decisive shift from client-server software to software as a service. Google, eBay, and established the value of multi-tenant internet applications in the consumer market, and, Google, and others have been proving that this same multi-tenant model is winning in the enterprise as well.
This shift to Web-based applications has generated two powerful waves so far. Now, we are seeing a third wave—one that we are calling Web 3.0—and it may prove to be the most significant and disruptive yet to the traditional software industry.

While the world doesn’t need another buzzword, I feel that both the emerging generation of entrepreneurs and developers, as well as traditional software ISVs, need to grasp the enormity of Web 3.0 and its potential to create change, disruption, and opportunity. Web 3.0 is about replacing existing software platforms with a new generation of platforms as a service.
To put Web 3.0 into perspective, we need to look at all of the major waves in the history of the Web. They are not defined by distinct periods of time, but are best seen as overlapping waves of adoption.

Web 1.0: Anyone Can TransactWeb 1.0 was about the emergence of the “killer app” from companies like eBay,, and Google. Although we thought of them as Web sites at the time, they were really amazing applications with a level of functionality, ease of use, and scale that had rarely been seen before by the average consumer. Transactions, not just of goods but of knowledge, became ubiquitous and instant. The efficiency and transparency that was once the domain of global financial markets was now at the command of individual consumers and businesses. Web 1.0 remains a huge driving force today and will continue to be for some time.
Web 2.0: Anyone Can ParticipateWeb 2.0 is about the next generation of applications on the Internet, featuring user-generated content, collaboration, and community. Anyone can participate in content creation. Posting a viral video on YouTube, tagging photos from a party on Flickr, or writing about politics on Blogspot requires no technical skill, just an Internet connection. Participation changes our idea of content itself: content isn’t fixed at the point of publication—it comes alive. Google’s AdSense became an instant business model in particular for bloggers, and video-sharing sites have rewritten the rules of popular culture and viral content.

Whether you are creating a business around Web 1.0 or 2.0, building massively scalable data centers that are secure, reliable, and highly available is not a job for the faint of heart or shallow of pocket. For companies entering the emerging software as a service industry, the massive time and capital requirements remain a substantial barrier to entry. Moreover, traditional client-server software development is still mired in painful complexity. And the “rewards” for creating a successful application are arduous deployments and maintenance.

Web 3.0: Anyone Can InnovateWeb 3.0 changes all of this by completely disrupting the technology and economics of the traditional software industry. The new rallying cry of Web 3.0 is that anyone can innovate, anywhere. Code is written, collaborated on, debugged, tested, deployed, and run in the cloud. When innovation is untethered from the time and capital constraints of infrastructure, it can truly flourish.

For businesses, Web 3.0 means that SaaS apps can be developed, deployed, and evolved far more quickly and cost-effectively than traditional software of the client-server era. The dramatic reset in economics should help CIOs finally break through the innovation backlog created by the cost and complexity of maintaining client-server apps.

For developers, Web 3.0 means that all they need to create their dream app is an idea, a browser, some Red Bull, and a few Hot Pockets. Because every developer around the world can access the same powerful cloud infrastructures, Web 3.0 is a force for global economic empowerment.

For ISVs, Web 3.0 means that they can spend more time focusing on the core value they want to offer to customers, not the infrastructure to support it. Because code lives in the cloud, global talent pools can contribute to it. Because it runs in the cloud, a truly global market can subscribe to it as a service.

Just ask my friend Jeremy Roche, the CEO of CODA, Europe’s second-largest ERP vendor. CODA successfully navigated the transition from mainframe to client-server, and now it’s facing an even bigger transition to SaaS. Building the infrastructure—not just the data center but the entire software stack as well—would take upwards and $20 million and several years. Instead, Jeremy is using our platform to get a massive jump-start on this process. His systems engineers will not have to cobble together servers, load balancers, and networking switches and then find a small army of people to tune and maintain them. His software developers won’t have to build a security and sharing model, database or workflow engine—they’ll just use ours. Meanwhile, Jeremy’s team can focus on exactly what they do best: building a killer accounting application. CODA2go will be available this fall, giving Jeremy a big lead on the competition., Google, and have spent hundreds of millions of dollars to build these infrastructures already, and a dozen others, including Facebook, MySpace, Ning, Rollbase, Longjump, Dabble db, Intuit, and Coghead, are also offering some form of platform as a service in the cloud.

Creating ValueHow much disruption will Web 3.0 cause? An examination of the technology forces at work gives us a good clue:
Vic Gundotra, VP of Engineering at Google, offered this interesting perspective at a recent event. Vic looks at the history of computing, starting with the mainframe era, as two grids: vast computing power vs. low accessibility and terrific ease of deployment vs. poor depth of functionality.

The client-server era caused a reversal of polarity in both cases. Computing power was much more accessible but limited in scope; there was an explosion in functionality, but deployment became a nightmare. Vic sees the Web 3.0 era eliminating these trade-offs and potentially maximizing computing power, access, ease of deployment, and depth of functionality. As Vic says, the key is that industry leaders like Google,, and others have to work to make the cloud ever more accessible and programmable, keep connectivity pervasive, and make the client more powerful.

In our view, the move from mainframes to client server was painful for IBM and DEC and created massive wealth for a broad generation of new companies like Microsoft, Oracle, PeopleSoft, and SAP. Web 3.0 threatens Microsoft’s .net, BEA, and WebSphere. And while I expect companies such as, Facebook, Google, and to do well, I think that even more wealth and further innovation will be created by a new, more broadly distributed class of companies and entrepreneurs that leverage the power of Web 3.0.
One of our developers has a bumper sticker on his laptop that captures the spirit of Web 3.0 perfectly. It reads: “My other computer is a data center.” That’s a claim that any developer in the world can now make. And that’s the stuff of revolution.

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