Commercialization of the Internet
The commercialization of the Internet encompasses the creation and management of online services principally for financial gain. It typically involves the increasing monetization of network services and consumer products mediated through the varied use of Internet technologies. Common forms of Internet commercialization include e-commerce, electronic money, and advanced marketing techniques including personalized and targeted advertising. The effects of the commercialization of the Internet are controversial, with benefits that simplify daily life and repercussions that challenge personal freedoms, including surveillance capitalism and data tracking. This began with the National Science Foundation funding supercomputing center and then universities being able to develop supercomputer sites for research and academic purposes.
With the growing population and demands of Internet users, startups and their investors were encouraged to start profiting off of the Internet.
Early history
The core idea of the web was outlined by Vannevar Bush in 1945 as interconnected networks of hyperlinked pages. The first attempt to materialize this vision was by Ted Nelson in 1965 all the way up to 1984, a decade before Netscape.In the mid-1980s, the National Science Foundation, the backbone of the internet at the time, claimed that the Internet was for research and not commerce. This strict allocation of funding was known as the "acceptable use policy." The NSF were firm believers that the Internet would be thwarted and devalued if it were to open up to commercial interests.
However, simultaneously in April 1984 CompuServe's Consumer Information Service opened a new online shopping service called the Electronic Shopping Mall that allowed subscribers to buy from merchants including American Express, Sears, and over sixty other retailers.
Development of public networks
NSFNET, the National Science Foundation Network, was a three-layer network that acted as a backbone for much of the internet's infrastructure. Originally funded by the government, NSFNET was a big leap into the future which allowed networks to run smoothly. It allowed people to view pages without any cost to institutions. The allowance of users to access websites without having to pay to go on them would further develop the idea of being able to browse for items on the internet in the future. In 1992, interested entrepreneurs who believed there was money to be made from the Internet petitioned Congress to get the government out of the way of NSFNET.UUNET was the first company to sell commercial TCP/IP, first to government-approved corporations in November 1988 and then actively to the public starting in January 1990, albeit only to the NSFNET backbone with their approval.
Barry Shein's The World STD was selling dial-up Internet on a legally questionable basis starting in late 1989 or early 1990, and then on an approved basis by 1992. He claims to be and is generally recognized as the first to ever think of selling dial-up Internet access for money. The High Performance Computing Act of 1991 put U.S. government money behind the National Information Infrastructure, the National Research and Education Network, the National Center for Supercomputing Applications, and more.
Internet becomes a true commercial medium
Although the Internet infrastructure was mostly privately owned by 1993, the lack of security in the protocols made doing business and obtaining capital for commercial projects on the Internet difficult. Additionally, the legality of Internet business was still somewhat grey, though increasingly tolerated, which prevented large amounts of investment money from entering the medium. This changed with the NSFNET selling its assets in 1995 and the December 1994 release of Netscape Navigator, whose HTTPS secure protocol permitted relatively safe transfer of credit and debit card information.This along with the advent of user-friendly Web browsers and ISP portals such as America Online, along with the disbanding of the NSFNET in 1995 is what led to the corporate Internet and the dot com boom of the late 1990s.
1995 was a significant year for the concept of commercial Internet service provider markets due to two substantial events that took place: the Netscape initial public offering and emergence of AT&T World Net. The Netscape IPO brought a lot of publicity to the new technology of the Web and the commercial opportunities for ISPs changed. At this point in time, ISPs started providing their traditional service, text-based applications such as e-mail, and trying to expand to another service, web applications. This became a time where ISPs were incentivized to expand and experiment with new types of services and business models. The entry of AT&T on the other hand created an Internet access service that spread nationwide and gained one million customers due to its publicity and marketing. Despite this, AT&T did not dominate the commercial ISP markets, and in fact, led to the growth and emergence of other independent ISPs such as AOL, going against the predicted trend that commercial ISP markets would be dominated by only a few national ISP services.
The commercialization of the Internet is going so well due to four main reasons. First, the academic model could easily migrate into business operations without requiring additional providers. Second, it is feasible for entrepreneurs to learn and gain benefits without too many technical and operational challenges. Third, customizing Internet access is widespread through many different locations, circumstances, and users. Fourth, the Internet Access industry is still growing and provides a lot of opportunities for further research and practice.
Dot-com bubble
Between 1995 and 2000, Internet start-ups encouraged investors to pour large sums of money into companies with ".com" in their business plan. When the commercialization of the Internet became more acceptable and fast-paced, Internet companies began to form rapidly with minute planning in order to get into what they thought would be easy money. It fueled by enthusiasm for all of the new opportunities and profits the Internet had to offer, produced some successful companies such as Amazon.com.This was shortly followed by the Dot-com Crash in 2001, wherein many of the same start-up companies failed due to a lack of concrete structure in their business plans, and investors cut off funding for the unprofitable companies. This led many people to believe that the Internet was overhyped, but in reality this turning-point for the Internet led to a revolutionary concept known as Web 2.0.
Early social media platforms
The introduction to social media started in 1994 when GeoCities was created by David Bohnett and John Rezner. GeoCities, being the first form of web hosting on the Internet, let users utilize its functions to create "digital neighborhoods", which let everyone using the platform discuss different topics in depth with others involved in the same discussions. The concept of connecting with others through the Internet in this manner that was established by GeoCities paved the way for the emergence of other social media platforms.In December 1995, Classmates, a website created by Randy Conrads, enabled its users to create their own profiles, search through large yearbook databases, and add their high school friends to their friend list. Two years later, in 1997, Six Degrees, which is widely considered to be the first social networking website, included many of the popular features on Classmates, such as creating profiles and adding friends and school affiliations.
File-sharing computer services
Before the internet, sharing files was through dial-up BBS systems, floppy disks, tapes, magazines, CD's and other forms. However, with the creation of the internet and the development of new applications made file-sharing much easier. A prime example would be Napster, a music file-sharing application created by Shawn Fanning in 1999. The main idea of Napster was for people to share music files between each other, virtually, without the use of a physical copy. Napster was the reason why we have digital forms of music, TV-shows, and movies. Napster forced production and music companies to make digital forms of their media and streaming services.File-sharing computer services started to become more accessible to users due to applications like BitTorrent. The creation of BitTorrent brought peer to peer sharing and users were able to use the built-in search engine to find media they would like to view. BitTorrent's traffic made up 53% of all peer to peer traffic in 2004 even though it was a file-download protocol. Since BitTorrent was a file- download protocol, it had to rely on websites like The Pirate's Bay for users to share their media onto the website and then users were allowed to download media onto their computers through BitTorrent.
Web 2.0 and the rise of social media
Web 2.0
The bursting of the Dot-Com Bubble in 2001 acted as an unforeseen gateway for the transition from Web 1.0 to Web 2.0 by 2004. A conference between Tim O'Reilly with O'Reilly Media and MediaLive International coined the term "Web 2.0". This conference became an annual "Web 2.0 Summit" in San Francisco, where the idea was developed gradually from 2004 to 2011. Web 2.0 included data that existed prior within Web 1.0 with improved data management and increased interaction. Web 2.0 was majorly delivered by AdobeFlash, Ajax, RSS, Eclipse, JavaScript, Microsoft Silverlight, etc.Some key characteristics of Web 2.0 included:
- Development of user friendly advertising i.e. banners and pop-up ads developed by Google and Overture
- A platform for the people by the people
- Users now able to add value to existing applications
- Transition from static to dynamic HTML serving web applications to users
- User-generated content
- Growth of social media
- Transition from passive viewing to co-authoring
- The transition from read-only web to read-write web.
Web 2.0 catapulted the marketing industry into a completely uncharted territory. With encouraged user integration, there were now enhanced retail opportunities, increased marketing visibility, and the ability for business to interact with customers. In November 2005, Google came out with Google Analytics which allows sellers to track buyers' referrals, advertisements, search engines, and e-mail promotions. All of these characteristics of Web 2.0 combined gave way to "viral marketing": a marketing technique that was all over the internet, all the time. Business could now promote products or services to larger audiences wherever, and however they chose to.