Taking the best of Web 2.0 and Web 3.0? Using the Web 2.5-style metaverse as a hint to consider transitional-phase business.

Recently, there's been increasing talk about "Web3.0" concepts like blockchain, NFTs, and the metaverse. However, many people likely find it difficult to visualize how to leverage the decentralized, distributed management proposed by Web3.0 for their own businesses.This time, we explore the present and future of the web under the theme "Can Web2.5-style metaverses become the foundation for Web3.0's maturation?" We seek business insights from Web2.5-style metaverses, which combine the best aspects of Web2.0 and Web3.0.

What is "Web2.5," positioned between Web2.0 and Web3.0?

Since late 2021, the keyword "Web3.0" has gained widespread attention. However, it's also true that many hold skeptical views, such as "it's just a passing fad" or "it's being exploited for speculation and money games, leaving its essence behind."

Amidst this, "Web2.5" emerged. This concept was introduced in March 2022 by Amanda Cassatt, CEO of Serotonin, a blockchain-based marketing agency, and quickly gained traction.As the name suggests, Web2.5 refers to the movement aiming to bridge the gap between Web2.0 and Web3.0. It proposes introducing Web2.5 as a transitional cushion, anticipating that user adoption of Web3.0 will take time.

While we've covered Web3.0 in previous articles, let's revisit the key differences between Web2.0 and Web3.0 here.

Web 2.0: Centralized Internet
Shifting dramatically from the 1990s, when users could only view websites, the 2000s saw the emergence of blogs and SNS. This transformed the internet's purpose from "viewing" to "participating." Essentially, it enabled two-way communication between content creators and consumers. However, the growing dominance of a few global players led to the centralization of user data online, bringing privacy and security concerns into sharp focus.

Web3.0: The Free, Decentralized Internet
Web3.0 represents an evolution beyond the structure of Web2.0, aiming for decentralized management. It is seen as a movement where users connect directly with each other through blockchain technology to create economic ecosystems.In Web3.0, individuals own and manage their own data and content, enabling direct exchange of information and money between users. Furthermore, "proof of value"—verifying the uniqueness and scarcity of data—and "guaranteed transparency"—where all past transactions are recorded—are major characteristics of Web3.0.

Web2.5 occupies the intermediate space between Web2.0 and Web3.0. While not fully decentralized like Web3.0, Web2.5 maintains a governing body. Unlike Web2.0, where benefits concentrate among a few players, Web2.5 represents an intermediate world.

It aims to reconcile the "Web 2.0-style organizational structure," where stakeholders manage the internet, with the "Web 3.0-style philosophy," where all participating individuals and companies become creators and producers, sharing in the profits. Concerns exist that without Web 3.0 maturity, maintaining order and distributing profits effectively may prove difficult. However, it is believed that Web 2.0-style administrators can safeguard participants' freedom and interests by upholding order.

Is transitioning through Web 2.5 before moving to Web 3.0 realistic?

So why is it necessary to insert this cushion called Web2.5 before transitioning to Web3.0?

As mentioned earlier, Web3.0 is built on blockchain technology. NFTs (non-fungible tokens) leverage this technology to prove the uniqueness and scarcity of data. This makes them well-suited for auction houses, which require proof of value. For example, a long-established auction company focused on NFTs early on.It launched its first NFT sale in April 2021, and its NFT sales that year exceeded $100 million. This is a prime example of swiftly connecting to the full-scale adoption of Web3.0.

However, for other businesses and services to leap directly to Web3.0, there are hurdles in adopting and utilizing blockchain technology. Technologically, it requires significant investment, and its operation still has many unstable aspects. This led to the concept of deliberately passing through Web2.5 rather than aiming straight for Web3.0.Currently, the prime example realizing this Web 2.5-style internet is the "metaverse." A virtual space distinct from reality where participants interact on equal footing, the metaverse can be seen as a Web 2.5-like world that incorporates Web 3.0 concepts into Web 2.0.

Considering the Path to Web 2.5, Inspired by the Metaverse

Let's now explore the latest trends in the metaverse while deepening our examination of Web2.5.

The metaverse refers to a virtual space on the internet where large numbers of people can participate simultaneously and share diverse experiences. As introduced in this article, it has long been familiar in the gaming world. However, it gained significant attention in November 2021 when Facebook Inc. changed its name to "Meta" and announced its commitment to advancing metaverse initiatives. Tech companies worldwide are now engaged in fierce competition to become metaverse platform providers.

Amidst this, a platform has emerged that maintains Web 2.0 management systems while incorporating Web 3.0 principles into its operations. A certain metaverse platform, planned, developed, and operated by a Japanese company, features a centralized management structure. Yet, users can earn revenue through hosting paid events and selling paid gift items or avatars.

In contrast, a virtual space operated by a U.S. company that emerged in the 2000s allowed users to freely expand the space. This led to excessive expansion of the game space, resulting in decreased population density and depopulation. Learning from this case, the aforementioned metaverse platform centrally manages the space to prevent excessive expansion while enabling user profit sharing. Participants are united in cultivating their own unique space and culture.

Now, the concepts of Web 2.0 and Web 3.0 within the metaverse can be overlaid onto the distinction between a "closed metaverse" operated by a single organization and an "open metaverse" where multiple services interact with each other. Let's examine each in detail.

Closed Metaverse
This describes a state where a single company operates the metaverse. In such a closed environment, the operating company holds significant influence, making it closer to a Web 2.0 model. Steven Spielberg's 2018 film Ready Player One depicted a scenario where a giant corporation sought to acquire the operating rights to a VR game, threatening the protagonists. This suggests that monopolistic control over a virtual world can have substantial impacts on the real world.

Open Metaverse
A state where multiple platforms and services are interoperable. An open metaverse, where experiences remain consistent across multiverses while users share benefits, represents an environment closer to Web3.0. A key advantage of a decentralized open metaverse is the ability to secure numerous alternative solutions if problems arise within a single space.

Digital communication via the internet evolved significantly from the fragmented information of Web 1.0 to the centralized Web 2.0. Web 3.0 feels like a movement aiming to swing the internet back toward a decentralized, highly flexible state by leveraging new technologies like blockchain.

Web 3.0's widespread adoption is expected to take several more years. If its inherent freedom leads to prolonged disorder and uncontrollability, it might fade away before achieving widespread use. To prevent this, transitioning through Web 2.5—a hybrid model combining the best aspects of "Web 2.0-style platforms managed by players" and "Web 3.0-style operations delegated to users"—could accelerate Web 3.0's maturation.For businesses, while keeping an eye on the Web3.0 future, it might be wise to also consider the practical approach of Web2.5-style business models during this transitional period, which is expected to continue for some time.

In aiming for the free, decentralized internet world of Web3.0, we've examined the validity of starting with "Web2.5" based on Web2.0. We also highlighted the metaverse as the most straightforward example of Web2.5, contrasting the Web2.0-like world with closed metaverses and the Web3.0-like world with open metaverses to explore future possibilities for organizations and businesses.For those struggling to grasp Web3.0 and hesitant to take action, adopting the Web2.5 perspective—which combines the best aspects of Web2.0 and Web3.0—may reveal new business insights.