Web3 and the future of digital advertising

By Ben Zimmerman, President of SmartMedia Technologies.

Many see Web3 as the next chapter of the Internet. Web3 represents a seismic shift from centralized systems to online decentralized systems. Its purpose is to allow individuals to control their personal data. Dubbed the third generation of the Internet, Web 3.0 is preceded by versions 1.0 and 2.0 of the 1990s and early 2000s, respectively. So to define where we are and where we're headed, let's see how we got here.

Web 1.0, also known as the "Static Web", refers to the early days of the Internet, when it was primarily used to access information and resources. For users, this meant “surfing” websites that were typically made up of read-only text and images. Web 1.0 had limited interactivity and lacked dynamic content. Yahoo GeoCities hosted a vast network of private sites from the early 1990s until its demise in 2019. These one-dimensional web pages may seem archaic today, but they helped lay the groundwork for what was to come.

If Web 1.0 laid the foundations of the Internet, Web 2.0 marked its integration into our daily lives. As the second generation of the Internet, Web2 is characterized by social networks, user-generated content and cloud computing. Also called the "Social Web", Web 2.0 was initially focused on interactivity and collaboration. For many of us, Web 2.0 creates the social fabric of the Internet as we know it today. Users can call a ride on Uber, order lunch on Doordash, and like a video on Instagram, all within the same minute.

Many, however, believe that the Internet should be more than social media, which brings us to Web3. But instead of being a true heir apparent, Web3 seeks to uproot some shortcomings of Web 2.0. As Web 2.0 has become increasingly commoditized, a few large corporations control much of the power. In 2021, Google is expected to capture 28.6% of the global digital advertising market, with Facebook at 23.8% and Amazon at 11.6%, according to eMarketer. This accounts for over 60% of ad spend in the United States. Instead of centralization, Web3 promises a more open and democratic future.

Web3 technology is rooted in decentralized technologies such as blockchain and peer-to-peer networks, which distribute data across a network of nodes rather than storing it in a central location. Technology has already started creating new opportunities for individuals and businesses through decentralized digital assets. A torchbearer of Web3 technology, non-fungible tokens (NFTs), has seen a