Mike Butcher

One thing that struck me while I was in Los Angles last week was that the people I met kept saying the same thing: media, entertainment and technology are converging (yes, THAT word) on Los Angeles. The simple fact that the biggest music and Hollywood players are there, and the act that it is an hour’s plane ride from Silicon Valley, and an hour’s drive from San Diego (where the many of the big mobile firms are) means LA is ideally placed to become the physical manifestation of “convergence”. You can already pick it up in the fact that just about everybody, from young to old has a MySpace page, while amongst early adopters Helio (the 3G network) is the cool mobile brand, and YouTube is commonly known about.

AlwaysOn is not your typical conference. During the two and a half days it was on, it ranged from discussions about data to user generated content to venture capital to mobile. Quite a range. This was both a strength and a weakenss, but the audience handled it all with aplomb. Perhaps the hottest topic at the event was social media and in particular the rise of sites like YouTube and MySpace. A few days after saying it was serving 100m videos a day, giving it 60% of the online video market in the US (rivals like Yahoo VideoGrouper and Metacafe aren’t even approaching those numbers), YouTube CEO Chad Hurley was on a panel batting off questions about impending competition from Microsoft among other things. There were at least two other YouTube clone sites at the conference (there are 240 more out there in cyberspace) and it’s clear everyone is trying to figure out how to “monetise” this area. AOL is even trying to get in on the act. Hurley said YouTube has “created a marketplace for video”, not unlike eBay created a marketplace for auctions. At some point it becomes almost impossible to catch them up, just as many sites found with ebay. Other areas of social media and networking like the Facebook site are also attracting a lot of attention. And a few days later, when I was in LA, it became clear that MySpace is now a mainstream phenomenon. A few years ago AOL used to make a lot of money by selling AOL “keywords” – but these days even local radio station DJs just call out their MySpace home page (“check out MySpace slash Live105″) , sometimes instead of the station’s own web site. As for whether the dotcom madness is back in Silicon Valey – I’d say yes, but with a large pinch of salt. As one veteran told me, you don’t see Porsches parked on every corner like you did in 1999/2000, but people are much more upbeat than they have ever been in the last five years. Two things though – the faceless, characterless offices of the average Silicon Valley startup remained fascinating to me. I have never seen so many bare walls in an office. In Britain people would be “nesting” like crazy, adding posters and slowly dying pot plants – here they just get on with the coding…. And secondly – no mobile. No-one seems to think of the mobile area in Silicon Valley – but this is hardly surprising when you see all the billboards from the mobile operators proclaiming “less dropped calls’ than their competitors. When you are just trying to get a mobile signal, SMS and mobile media is just not worth bothering with. However, mobile media is increasingly an interest of the LA/Hollywod media scene, of which more later…

First published, Future Media, June 2006: Disney launched its first massively multiplayer online role-playing game back in 2003, the success of which has inspired the company to devise similar propositions around Lost and Pirates of the Caribbean: Dead Man’s Chest. Just what does the Mouse see in the MMORPG? Mike Butcher reports.

You can imagine the scene. Having recorded that must-watch show on the PVR, you are now painstakingly slow-mo-ing trough the ad-breaks for those tell-tale clues to the next steps in the game. Forget the show – this is the entertainment!

Incredibly this is virtually the scenario being played out around the world right now, as viewers stop fast-fowarding the ads inside hit show “Lost” and start paying attention.

So how did we get to this idealistic – but apparently real-world – situation?

It’s not possible to ignore the enormous success of Lost, which in the UK alone attracted six million viewers for its first episode on Channel 4 (it’s biggest-ever audience for a U.S. series launch), and has polled consistently well ever since.

Along with the clearly ground-breaking drama and non-linear nature of the plot, came some innovative marketing. Part of the original viral marketing for the show included a full-blown web site for the Oceanic Airlines upon which the hapless Lost passengers flew.

That site’s success in part lead Disney and ABC to launch the Lost Experience – a so-called Alternative Reality Game (ARG) in April this year. The move was preceded by Disney’s history in setting up similar online gaming communities around other brands using Massive Multiplayer Online Role Playing Games (MMORPGs).

But what exactly are these games?

The difference between a MMORPG and an ARG, is that the latter is not built as a virtual world. Instead, it is more like a detective game with clues appearing anywhere online, and the players must collaborate to hunt them down. ARGs were first linked to media brands in 2001 when pre-promotion for the WarnerBros film A.I. spawned an ARG called The Beast, designed ultimately as a marketing vehicle for Microsoft.

A MMORPG is an online computer role-playing game in which a large number of players interact with one another in a virtual world. Both MMORPGs and ARGs are immensely popular online, with several commercial games reporting millions of subscribers, especially in South Korea.

Now these games are changing from games purely designed for hardcore gamers to entertainment tools that appeal to more casual gamers and as such have a wider audience. Disney launched the MMORPG Toontown Online in 2003, and Virtual Magic Kingdom last year in order to build relationships between Disney characters and the audience.

Toontown Online (Toontown.com) was the film industry’s first three-dimensional MMORPG designed for kids and families. Launched in 2003 Toontown combines elements of traditional video games, online community and strategic role playing games. It success has lead to an expansion, with the addition recently of greater functionality for more intense gameplay.

Virtual Magic Kingdom is a free chat-based game run by Disney Parks and Resorts with the intention to allow people to experience the fun of a theme park online. It’s more a social game based on chatting and small mini games.

But the Lost Experience dwarfs other Disney projects to date – outside of its plans for Pirates of the Caribbean (of which more later).

The Lost Experience is not one web site or media platform, but a drip-feed to clues mostly seeded online but often triggered by fake adverts aired during the show. These link to mysterious web sites which might contain odd sound files and cryptic email newsletters.

Sometime the content is more overt. “Bad Twin” a novel supposedly written by one of the passengers on the doomed Lost plane is currently among the top 50 best-selling books on both Amazon.com, and published by Hyperion (owner: Walt Disney).

But far from being an exclusive game, inhabited by Lost obssesives and online geeks, the Lost Experience follows a parallel storyline not featured in the TV broadcast and is designed – says Disney and ABC – so that both fans and outsiders can join in. Clues first appeared during broadcasts on May 2nd in the UK, May 3rd in the U.S. and May 4th in Australia.

At the Experience launch ABC, Channel 4 and Australia’s Seven Network described it as “a revolutionary interactive marketing endeavor” which was “designed to further enhance viewers’ relationship with the program.” Over twenty other broadcasters are also signed up to participate.

Steve McPherson, president, ABC Entertainment said the initiative was driven by the fact that “audiences are demanding greater depth of content and more creative ways of storytelling”.

“The ‘Lost Experience’ gives the mystery, intrigue, twist and turns that ‘Lost’ provides as a television series,” said Mike Benson, senior vice president, Marketing, ABC Entertainment. “It’s like a giant, mysterious jigsaw puzzle that will come to life for all the world to solve, whether you are a fan of the TV series, or not.”

Tracy Blacher, head of New Media Marketing at Channel 4, said: “We wanted to find a way of allowing ‘Lost’ viewers to engage with Season Two in a genuinely innovative and creative way.”

Now Disney’s experience in those innovative online game communities is set to extend into film this year with “Pirates of the Caribbean: Dead Man’s Chest” also employing an MMORPG.

Launched at the E3 gaming festival, Disney Online’s Pirates Of The Caribbean MMORPG is slated for release in 2007. Players will be able to create and customise their own pirate, form a crew, interact with the film characters, forge alliances with thousands of other players and even hunt for buried treasure. To access the game players will need to pay a monthly charging monthly subscription fee, making it a useful revenue stream when the film itself has long since closed at the box office.

The games also need not be limited to the darkened rooms of PC players. mDisney, a mobile publishing unit of the Walt Disney Internet Group, is to launch a Pirates of the Caribbean “Multiplayer” mobile game enabling players to interact with eachother make friends and form guilds.

And if you get the game right, any subscriptions fees are not trifling. “World of Warcraft” (WOW), currently the most popular MMORPG, recently hit 6 million players who must each buy the game for $50 and then pay a monthly fee of about $15. Game researcher DFC Intelligence estimates that WOW brought in about $300 million last year in sales and subscriptions for Vivendi Universal. Other business models for MMORPGs include offering the game for free, but selling both advertising and virtual items inside it, such as different tools, weapons or even clothes for the player’s character. Some are even spawning their own currencies, creating secondary markets where real-world money is traded in exchange for virtual world currency.

Although MMORPGs are just 7% of the $28 billion game market, they may be the most addictive niche according to research from Stanford University. It found that while the average console gamer might spend seven to eight hours playing, players in MMORPGs spent 20 hours a week, potentially rivaling TV viewing figures.

But while an ongoing online presence – with subscription fees – seems like a no-brainer for a film, what are the benefits of MMOs to TV brands? Can MMORPGs help programme brands hang on to straying TV viewers or can they really help build communities around brands?

Michael Smith, CEO of Mind Candy which has launched it’s own ARG Perplex City (PerplexCity.com) says: “TV networks are increasingly adding depth to their shows to enhance the experience for the viewer but also to generate additional revenue streams. This might take the form of an MMO or something more akin to an Alternate Reality Game where part of the universe is fleshed out via websites, emails, phone messages, podcasts and so on.”

He says blogs, fan sites, and discussion forums already provide a venue for fans where they can spend time at when the show isn’t on. “It makes the whole experience far more engaging and immersive than a traditional TV show,” he says. Add an ongoing game which also plays out when the show is not airing and you have a heady cocktail which cost a fraction compared to traditional marketing, both among fans and newcomers to the show.

This seems to be the case with Lost Experience. In the US, Lost has already ended its second season leaving plenty of questions were unanswered, with viewers having to wait until September for new episodes. Meanwhile the game will undoubtedly act as the carrot to keep the core viewers interested and new viewers can be attracted outside of the promotional window – an aspect confirmed by Disney’s Benson.

Indeed, a reviewer on the ARG News web site said the Experience was “giving players the sense that the game is something they should be watching every day “.

It’s hard t by that kind of word-of-mouth-marketing, and Disney knows it – and, according to sources, is even telling broadcast partners not to talk too much about the game, lest the punters awake from their slumber in this alternative reality.

But how do you measure success with this kind of project? A Disney spokesperson in the UK says: “This is difficult as it’s still relatively early days for a lot of these initiatives. But using web traffic measurement to see how many people are visiting sites/playing games, how often they do, how long they play for etc is something we do. Tracking media migration is more difficult and might need specific campaign metric tools in place.”

But this game is more than just a way for Lost nerds to keep busy. It’s also keeping viewers from fast-forwarding through commercials.

Adverts for the fictitious Hanso Foundation – linked to the show via one of the characters – featured phone numbers and Web sites which viewers needed to visit for more clues about the game.

On closer inspection, links with marketing campaigns are starting to appear. Hanso “commercials” feature small print saying they are paid for by well-known brands including (in US shows) Coca-Cola’s Sprite, DaimlerChrysler’s Jeep, Verizon Wireless and Monster.com.

One of the “Lost Experience” sites is called subLYMONal, which is a reference to the so-called lemon-lime (hence lymon) taste of Sprite. Once on the site, the word “Obey”- as in “Obey Your Thirst with Sprite” – is surrounded by glowing blue TV screens that the user must turn into glowing green TV screens to unlock a message.

The Hanso commercial shown during the US episode on May 17, 2006 contained a Jeep copyright message and directed players to a Jeep video commercial hosted on YouTube, which contains game clues at the end.

And during the May 24 US episode The Hanso Foundation advert was shown with a disclaimer indicating that it was “paid for by Monster.com.”

Indeed, Benson recently admitted that the Lost Experience is – at least in part – also a marketing vehicle for marketers who are looking for need new methods to reach viewers.

The ideas in Lost Experience have already caught on. AOL recently announced a promotion called Gold Rush this Autumn will feature a game where viewers can find clues during CBS shows and commercials, to help them identify where more than $2 million’s worth of gold is hidden in the U.S.

And in the US Imagine Entertainment, the company that created “24”, is among a group pf firms developing a sci-fi reality show called Xquest. Contestants will occupy a cramped “spaceship” for a month, following a rough plot while online gamers follow the action on the TV and in a shared, simulated space online. The best gamers then get to go on the next season’s show.

If the Lost Experience is anything to go by, it looks like we’ll be seeing a lot more of MMORPGs.

I’m new to the new music scene of “Emo” (Emotional Punk, apparently), but following a link from a trends site I found Mylocalbands.com. From here you can find the site for Fall Out Boy. Here, fans can post pictures they’ve taken of their fave band and find out where eachother are for meetups etc. This seems to me like a fantastic mashup idea and pretty much confirms my view that most social software is pretty pointless until it’s applied to a content environment. In this case people are able to network around being a fan and into music. Similarly MySpace did well out of music. And of course, Last.FM. And last night I heard about a start-up that will apply social networking to people who like Wine. It’s a natural fit. So, while everyone works this out for themselves, enjoy Fall Out Boy’s latest offering.

An impromptu party organised by Mike Arrington of Techcrunch.com fame attracted upwards of 100 people to a central London bar on Monday night this week. One of the issues on people’s minds was when is the bubble on this latest Internet boom going to burst? Chatting over a beer Arrington said “When the market falls out of US house prices. Then people will start watching what they spend and the advertising market will drop.” He thinks its the ad market which is driving a lot of new Web start-ups. And he’s right, to a large extent. Look at YouTube / MySpace etc. ALl media plays.

Meanwhile, I ran into a few new start-ups which I’ll be writing about shortly…

Stumbling through London the other day after a long session at the Powerbook, I realised I just had to turn into a pub for a pint. Put it down to the call of nature. Incredibly, but who should happen by but Peter Nixey of Webkitchen. We got chatting over a jar, as you do, and he mentioned a new Web 2.0 project he was working on.

Now, before you scream “We hate Web 2.0″, just listen. His idea was to create a site which uses “no server-logic and stores no data of its own.” Very Web 2.0, I said.

The result is Eventsites, a true mashup of Google Maps, Flickr and a calendar API. This means anyone can create a web site for an event, with a map to the event and associated photos. All very easy and simple.

Now, I know you are going to say – that’s been done before. But the point is, it’s not been done in this way very often before, and the interesting thing about it, is that it took just one young guy who lives in South West London to do it.

Peter Nixey has a longer explanation on his blog about how and why he did it, but I just want to say that this kind of thing is, to me, what Web 2.0 is all about, both in culture and implementation.

Regarding the latter, if you read Dion Hinchcliffe’s quite interesting definition of Web 2.0, Nixey’s site fulfills pretty much all of the criteria. To quote:

“Key Aspects of Web 2.0″



- The Web and all its connected devices as one global platform of reusable services and data (Three APIs – Check)

- Data consumption and remixing from all sources, particularly user generated data (See above, plus Flickr pix – Check)

- Continuous and seamless update of software and data, often very rapidly (APIs updated as they go – Check)

- Rich and interactive user interfaces (Check)

- Architecture of participation that encourages user contribution (Flickr pix and comments – Check)

Regarding the former – culture. What I mean by that is that Web 2.0 represents the rise of very small teams, capable of implementing useful things very quickly and developing them in a continuous manner in concert with user participation. In this case the ‘team’ is just one guy. That’s why the Web 2.0 movement has so much potential power I think.

Can we get a Podbop for the Uk please? Anyone out there interested?

How about this? A Web 2.0 Innovation map:

“The Web 2.0 Innovation Map grew out of an interest in how Web 2.0 development is distributed geographically. Using the lists of Web 2.0 applications from various sources (see listings) and a bit of elbow grease to locate addresses, the Innovation Map was born. The locations listed here have come either from a WHOIS lookup or the contact information from the web site itself. Locations are not guaranteed to be accurate.”

Cary Marsh, Mydeo.com

Paul Munford, Monty’s Mobile Gaming Outlook

This week Mbites.com brought together Cary Marsh, co-founder of consumer streaming video start-up Mydeo.com and Paul Munford, editor of must-read weekly mobile industry newsletter Monty’s Mobile Gaming Outlook, for the first in a weekly series of podcasts.

Hosted at the cool London private members club, Adam Street, the podcast covered recent events at 3GSM, the global mobile conference and whether we really think the current hype about mobile video “has legs”. Download the MP3 file here (approx 16MB, 15 minutes long).

If you’d like to be a guest on the next podcast, where we’ll be documenting some of the most interesting new development in digital and mobile media, contact Mike Butcher.

“They stole our revolution. Now We’re stealing it back”. So runs the tagline at the end of the weekly email newsletter for technology geeks, NTK.net. And although the slogan has been running since 1997, in 2006 the slogan has never been more appropriate. Standing outside a cold London town hall, watching hordes of mostly fresh-faced young men (I counted six women among 800) file in to a conference on the future of web applications, “stealing back the revolution” feels like an appropriate phrase. It’s a long way from an autumnal day in San Francisco, Oct 2004. But was this dawning of the mythical “Web 2.0″ movement in the UK, or another false dawn for the Uk internet industry?

The phrase Web 2.0 started life as media savvy way to bill a conference put on by technology luminary and publisher Tim O’Reilly in October 2004. This tried to pin down some of the emerging trends online, which didn’t seem to fit into the old “just another web site” box.

The conference built on earlier theories about the “Semantic Web”, which treated the web more like an operating system in its own right, rather than just a telecommunications network. Web 2.0 was also about mass participation of ordinary people – so blogging and communities fitted in.

For the next year or so the term grew in currency until just about anything new online was being labeled as “Web 2.0.”

A year later, in October 2005, The Web 2.0 conference convened again, and this time the sense of a “bubble” was palpable. Whereas smaller web developers had attended the first event, the second was noticeable for the addition of large online firms and venture capitalists, all hungry to exploit the new momentum in the Web industry, for so long in the doldrums after the bubble burst in 2000.

You could hardly blame them. 2005 saw some of the biggest business deals done online for five years. The August 2004 flotation of Google had kick started a year of gang-busting rises on technology stocks. A new wave of US sites like Flickr, MySpace, Upcoming, del.ici.ous were all bought out and various commentators landed on the Web 2.0 handle to lump these events in together.

Fast forward to the present, and the Web 2.0 movement hit London in the form of several physical events all within the space of a week. The future of Web apps conference, an MSN dominated event billed as “Mashup” at the Royal Society of Arts, and one by New Media Knowledge on creating innovation and Web 2.0 startups in the UK.

So is another dotcom bubble starting to occur, or is something fundamentally different happening? And is the UK about to “miss out” again, given it had barely 6 months of boom last time around?

In a packed Kensington Town Hall, over 800 web developers pushed fire regulations to the limit (200 more had to be turned away) to hear speakers from some of the poster children of the new wave on the Web including Flickr, Google, Yahoo!, 37signals.com, feedburner.com and Haveamint.com.

The “Future of Web Applications” conference was organized by Ryan Carson. An American living in Bath who himself developed a Web 2.0 application, Dropsend.com, said: “There’s a real buzz because we made it affordable for ordinary coders to come. The culture of the UK we’re trying to battle is the perception that there isn’t innovation happening here. Dropsend was contacted by VCs, but none of them are from the UK, for instance.”

During the event, Carson gave a much lauded presentation on how to build a Web 2.0 company and application from scratch, and unusually with costings. The final figure came to £25,680, which seems a paltry amount, given that del.icio.us was sold for a reputed $30m after a similar tiny investment.

In fact, Joshua Schachter, who created del.icio.us, also spoke to the assembled crowd. Del.icio.us perhaps typifies the Web 2.0 movement among small teams of hackers and developers. Created as a hobby project to publish Schachter’s collection of favourite web sites online, it became a place where you could browse other people’s. This created a huge buzz, since suddenly people could easily find out what was “hot” long before any media outlet had deemed to report on it. Del.icio.us – together with sites like Flickr – allow free-form tagging of sites, which creates a taxonomy created by ordinary folk, dubbed a “folksonomy”.

But hard-core Web 2.0 proponents don’t talk in terms of what people do online, but what machines do. Speaker David Heinemeier Hansson of 37Signals.com wrote a computer language called Rails, which is often called “Ruby on Rails.” With is he built, Basecamp.com and Tadalist.com, simple online project management tools which have put the wind up much larger firms in the space.

Kicking back in a leather sofa in Kensington, Heinemeier Hansson chuckles about all the fuss.

“Web 2.0 is a Joker card for anyone to use at this particular moment in time,” he says. ” It’s amazing we’ve gone on for so long without people really defining it.”

He puts the new wave down to some very simple things. After ten years of the Web and the development of computing, “software is free, hardware is cheap, so all you need is passion and time. We’ve removed the obstacles to create something online. Thus you see a bubbling up of new projects that do interesting things.”

He says Web 2.0 is not a full-blown dotcom bubble. “To me a bubble is when everyone is on board. To me there’s more dissent. And no-one is really making any money compared to last time. A handful of companies have been bought out, but that’s a couple of drops in the ocean.”

He thinks that this time round Web 2.0 will be a seen as a platform where normal people can build a sustainable, long term business by offering services and software.

He developed Rails to be a programming the framework which sits on top of the Ruby programming language which means it’s much easier to create simple, elegant web services quickly. The result means a much better experience for the web site visitor.

So, for instance a user can interact with the site without having to load lots of pages – all the work is done within the one screen. Typical examples of this include Google Maps and functions on Flickr.com. This is achieved by using a language called Ajax to build javascript applications faster and more easily.

Web 2.0 sites end up doing more of the hard work for the user, which probably means they will appreciate a site more and return more often.

Cal Henderson, chief architect of Flickr.com, also spoke at the conference. He says Web 2.0 is “”It’s just a name for a bunch of technologies that have been around longer than the term.” He defines Web 2.0 as being about the collaboration and aggregation of data, along with an opening up of software by firms to make this possible. One example is firms releasing the code for their Application Program Interface (API), a set of routines, protocols, and tools for building software applications.

“Mashups” of APIs are creating a buzz online because of the possibilities of literally mashing up several data sources. Typical mashups often involve Google Maps, such as Housingmaps.com which mashes together real estate ads taken from Craigs List with maps.

Tom Coates, a ‘social media’ expert and blogger, who built a thoughtful reputation at UpMyStreet and the BBC and recently joined Yahoo! says the “web is starting to change dramatically and become more than the sum of it’s parts”

He says we are moving form a world of linked web pages to a world of data sources linked via APIs: “The data is moving to the centre and becoming more connected in a way it never was before. [It's becoming] a web of data sources, services for exploring and manipulating data, and ways that users can connect together.”

So, for instance, as an internal experimental project at Yahoo! which is not public, he bult a “Yahoo! Astronewsology”. This merges information from the Yahoo! News site with Astrology predictions. Thus you can compare what was supposed to happen to, say, Capricorns that day, with what actually did happen.

Although this is a humorous application, Coates says that the effect of anything which is a “mashup” of data sources ends up making both services “better and more useful. The consequences are that this creates massive creative possibilities, accelerated innovation and no one has to build the same service twice. To real people it means a greater sense of connection – and whatever they do generates more value.”

But mashing up APIs are not just crazy geek ideas. As Coates points out, the BBC has released the API for its programme information, allowing developers to build tools which bring people back to their programming. And in the future, not release an API may mean your online business will turn into a “backwater” says Coates.

In theory sites with these newer approaches could start to have a competitive advantage. And small teams can also make use of the web to market their ideas through blogs. Who needs vast marketing departments?

“Size is no longer an advantage and often a huge disadvantage. Microsoft was one of the firms that made Ajax work, but they are almost the last ones to make it work,” says Heinemeier Hansson. Microsoft famously won’t be ready with Atlas till late this year. It took just three people to make Basecamp.

It’s partly factors like this which are getting business people excited about Web 2.0, and igniting the hype about a new dotcom bubble. Bubble 2.0 anyone?

As Ashley Friedlein, CEO of e-consultancy.com, points out, Web 2.0 style application are probably going to be “great for online retailers.” It makes sites faster. That means people buy faster and are more likely to come back. And its no coincidence some developers at the conference were from large financial institutions, including American Express.

But back on the conference floor, some voices of frustration were emerging. The brave new 2.0 world means more power than ever before can be wielded by small teams of committed geeks, perhaps a satisfying riposte to the hordes of Google developers and the Venture Capitalist driven dotcom bubble of old. But where are these crack teams coming from in the UK?

Delegate Peter Nixey of WebKitchen.co.uk says “The trouble is Web development has not been in fashion in the UK. Developers go and code secure systems in Java for banks, but we’re not breeding Web 2.0 developers in the UK. In the states it is and you can get a decent job The City hinders the opportunities here because the risks of being an entrepreneur are too high. There aren’t any TechCrunch BBQs here where someone will come along and buy you for 500K.”

Entrpreneur Gareth Knight, of OneAfrikan.com, says: “I hope this event will kick start the UK. The UK new media industry revolves around advertising and marketing and not around technology. All the top web agencies are in media, not technology. An investor who I talked to said are you prepared to go to Silicon Valley, because that is what it’s going to take.”

Attending the conference was Paul Birch, co-founder of BirthdayAlarm.com in 2001, and one of the few UK entrepreneurs to have taken a UK-based start-up to Silicon Valley. He believes the UK is not ready at all for the next wave of web services.

“What is the same as the last time we had an upturn in the Internet business, is that the UK has fucked up again. We enjoyed just six months of the last bubble. The US are beating us by a factor of 20-1 this time round,” he says.

“The fact is Web 2.0 will produce lots of multi million dollar businesses. But the difference in the US is that there is an ongoing conversation between techies and business and they can interface. In the UK we don’t seem to have that middle layer,” he says.

Right now there is not big money, because Web 2.0 firms can do it cheaply without the need for venture capitalists and large investment. Development is now a commodity item.”

Also attending the conference was Simon Murdoch, Amazon’s first boss in the UK and now an active angel investor in companies such as Videoisland, Shazam and FriendsAbroad.com, a new Internet service for people who want to improve their language skills. Murdoch says, without a hint of irony that “there’s potentially a paradigm shift going on. Web 2.0 is data being interconnected, which means you can do things quickly and in interesting ways. We’ve only just started to understand the applications that can come out of this. Ultimately they will may a tangible difference, but it’s quite hard to predict how. The developers are evangelical about this, and the examples are just the first ones. It will take time for 800 people to go into their areas and turn them into real products for real people.”

“It’s too early to have affected the investment community. What’s going on here is more like 1997 in Web terms. Here’s cool stuff, and now think about what to make happen. Only then do you think about the business models,” he says.

Paul Farnell, a student at Manchester Metropolitan University, who has created Sitevista.com said: ” Universities here don’t encourage startups in the way US universities do. They do it from a commercial angle and take equity – in the UK they don’t.”

Just as the Web Apps conference sung the praises of the web as a new field for data, similar noises were being made at an exclusive event in London that Wednesday evening. At an event called “Mashup” organised by Midentity.com, Sam Sethi, a consultant to MSN UK, spoke before an audience not of geeks but of mostly pin-stripe-suited businessmen.

Sethi said the “GYM Club” (Google, Yahoo and MSN) are out to form networks into which Web 2.0 service could be plugged in from outlying companies. But underneath it all, is data – and the gold standard will be our identities and reputations. Why? Because advertisers will demand that we are better and better targeted.

Only a day later 40 people gathered in central London bar to hear speakers from Yahoo, Last.FM and Video Island talk about why there are so few Web 2.0 firms in the UK, brought together by New Media Knowledge. The debate there was about how to bring out Web 2.0 innovation in the UK – where one developer had to resort to sleeping in a tent on a London roof to be able to afford to run his idea online.

Stories like this contrast with the media’s image of “dot-commers.”

Tuesday last week saw the return of a distinctly bubble-economy, billed as a direct echo of “First Tuesday ” the notorious networking event for venture capitalists and internet entrepreneurs of the late 1990s.

The contrast with the geeks at the conference couldn’t have been more palpable. While developers queued for a sandwich lunch on the Thursday, the revivalists behind “Second Chance Tuesday” quaffed drinks for five pounds a time at a central London private members club as they were filmed by TV crews.

As one blogger who attended wrote: “Since when are budding entrepreneurs known for being flush with cash?… I didn’t bump into many (new) people doing any web apps – most of the people there seemed to be focused around advertising / media / fashion.”

In all, it smacked of a time when hype was favoured over substance.

Meanwhile, British Web innovators continue to have to make a choice: job offer in San Francisco or rooftop in London?