Are you ready for the second internet?

Wedbush just released a very interesting report on what they call “The Second Internet” aka The Social Internet (beats web x.0 as a term I suppose). Whether they succeed in being seen as the company that coined the term or not remains to be seen, but the main points they bring up are worth highlighting:

• Social is embedded as the “DNA” of the company, i.e. they live and breathe social
• Business models are disruptive – and mobile is a key component of the business models
• Customers are in focus and contribute to the company’s value and receive a personalized experience, and
• Platforms are open, and the companies are constantly innovating

Some of the strategies that the players that are considered leaders in this space make very much sense, in that social discovery leads to rapid adaptation. Wedbush points to social engagement as one of the keys for instance for Huffington Post to achieve mass adoption:

This is precisely what we used to advocate on my previous company, Storyz, where we had a platform that allowed for user interaction across social media (see Storyz Live! pitch example), similar to what CNN has done with iReport. The importance of social in discovery is highlighted by Facebook’s power in driving traffic:

A key point, which the report points out, putting a ‘Like’ button on your site does not make you a competitor among this generation of companies. This is about understanding user behavior, engaging with them, and making them your advocates. Easier said than done.  While I definitely believe Wedbush has highlighted some very innovative companies in this space, a lot of companies are trying to emulate portions of what they are doing. They may not be there yet, but whether we will see disruption at the scale of what we did in the “first internet” remains to be seen.

At some point though, you have to wonder about saturation. Wedbush points out that the amount of data now available on user behavior is massive, and likens it to a scene from the movie Posiedon Adventure, where a crew sees a massive wall of water coming and comparing it to the data being generated. I wonder if the amount of data companies now have to deal with can be likened to the amount of “social input” a person has to deal with. At some point I simply do not care if my friends (and using that term in the widest sense as most people do when using social media speak) have been awarded a new fish tank (I am past this point already), which cafes they are mayors of (anyone try checking into a coffee shop in Double Bay in Australia may think I am running for election), or even what newspaper articles they found offensive. There will no doubt be a need for an individual “social radio button” where the volume can be set from loud to low in a hurry. Now there’s a business idea.