Microsoft Emerging Business Team member Don Dodge has another thought-provoking post on Internet business. Don notes how so many innovative companies who were market leaders in the 90's have been overtaken by the new era of "fast followers". Here's his list of examples:
* AltaVista -> Google
* Napster -> iTunes
* VisiCalc -> Lotus 123 -> Excel
* Word Perfect -> Word
* Netscape -> Internet Explorer
* Apple Newton -> Palm Pilot -> Blackberry
* IBM PC -> Compaq -> Dell
* Double Click -> Google Ad Sense
* Ofoto -> Flickr
* Compuserve -> AOL -> @Home -> Comcast & Verizon
That list is similar to Tim O'Reilly's list of Web 1.0 --> Web 2.0 companies. Tim mentioned two of the same examples in his list:
DoubleClick --> Google AdSense
Ofoto --> Flickr
Don suggests that inferior management decisions rather than inferior technology was the main reason why the 2.0 companies usurped the 1.0 ones.
It's also interesting to look at all the Web 1.0 companies that have continued their success in the 2.0 era. Amazon, eBay, Yahoo, Microsoft too. All of those companies are known for their smart business management, as well as continuing to innovate and react to disruptive technologies.
Also of note is that a few of the old 1.0 companies are now attempting to re-invent themselves as 2.0 companies - e.g. Lycos building a "social interaction platform". In those cases, you have to wander whether it's a case of 'slow follower' and will it be enough?
Finally, the same principle of 'fast followers' can be applied on a micro scale to segments within 2.0. One example is RSS Aggregators, where Bloglines was the dominant force in Aggregators 1.0. I'd suggest we've entered the 2.0 era of Aggregators now and products such as tech.memeorandum are beginning to make their presence felt.