Why are public goods essential for Web3?

Original Title: The World Of Web3

Written by: Azeem Khan

Compiled by: aididiaojp.eth, Foresight News

a16z partner Chris Dixon has explained that Web1 is "read," Web2 is "read and write," and Web3 is "read, write, and own." This article attempts to help us understand why the construction of public goods is important in Web3.

First, you need to further understand what public goods are.

Whether you notice that everyone around you is buying Dogecoin and believes it will soon be worth $1, or you hear that artist Beeple sold a picture for $70 million, Web3 has been one of the hottest topics of discussion worldwide over the past two years. So should we believe that this revolutionary technology will take over the world tomorrow, or think it will soon disappear from the news?

The reality may lie somewhere in between; while this technology may change the world, it won't happen overnight. However, that doesn't stop you from caring about the next iteration of the internet. In the next iteration, public goods and new ownership models will effectively combine.

The Importance of Public Goods

First, let's elaborate on public goods. Public goods include clean air, libraries, and even the power grid, characterized by their non-exclusivity of use and the fact that one person's use does not negatively impact another. In today's knowledge economy, a more relevant example is open-source software. Open-source software is non-proprietary software that anyone can modify or view its source code. Mainstream examples of open-source software include Mozilla Firefox, Linux, and jQuery. Open-source software enables developers to collaborate on projects created by different individuals, teams, companies, and organizations.

These public goods are like the roads and bridges of the internet; however, we no longer need to spend years fighting for permits or buying land, as we can now start building directly in Web3.

Current dominant internet giants like Google, Facebook, and TikTok turn the resources we see as public goods in Web3 into privatized products. They aggregate users and data, profiting from these users (i.e., you and me), leveraging network effects to grow their platforms while sharing very little profit with the users who create value, continuing this cycle to amass great wealth. One of the key reasons Web3 is exciting is based on the idea that companies can make money in another way without exploiting users for data and profit. We can now envision a world where open platforms exist that share profits and value with users, allowing us to create more value for all stakeholders. Tell me, doesn't that sound magical?

In Web3, builders are striving to create messaging applications, financial products, social media platforms, and search engines as public goods. Currently, these goods and services are owned by private companies, which allow us to use their products while bombarding us with mind-numbing ads every minute to profit. The ads we encounter seem to become increasingly intrusive over time. No matter how much profit they make, companies like Facebook always find a way to squeeze more money from us while somehow making us less happy on their platforms. Think about how terrible your experience on Instagram has been over the past few years.

User Ownership and Control of Data

Web3 builders are creating a world where platforms do not fully control data; users will own any content they create and retain actual ownership of the digital assets they purchase. Now, when you buy items like in-game assets or concert tickets, you think you own them, believing they belong to you. In reality, they are owned by the companies running the servers. In Web3, these digital assets exist on public blockchains, are transferable, and most importantly, they actually belong to the users.

If users can take their data and assets from one platform to another, it will create competitive pressure, which today's companies do not face, as they believe you have nowhere else to go. When this competitive pressure exists, companies will ultimately have to optimize their business models by shifting from extracting value to delivering value, knowing that if they do not create enough value for users, those users may quickly leave and take their data with them.

As our world becomes increasingly digital, digital property rights are becoming more important, which is impossible under today's Web2 models and platforms. We will soon live in a world where most things will exist on the blockchain, and this view is not unrealistic, especially in fields like art and music. But before we achieve this, we need a settlement layer that truly guarantees our ownership of digital assets through the blockchain.

This may sound cliché, but as people know, the internet will change the world in ways we know and later in ways we do not, and Web3 will do the same.

The job opportunities in Web3 are endless, and some of the smartest people in the world are leaving their original jobs to participate in creating the future of Web3. This work can often be done entirely remotely, meaning we can easily tap into talent globally.

Value Creation in Web3

Web3 specifically has the potential to unlock more value for everyone on the internet. Users own any content they create and any digital objects they purchase, rather than the platform controlling the data, and these assets are often portable.

To help us understand the next evolution of the internet, we need more people to grasp why Web3 is worth participating in. It is also time to stop allowing these companies worth billions and trillions of dollars to exploit us; we want them to co-create value as part of the network. Many Web3 projects are also expanding their influence, such as Crypto.com hiring one of Forbes' highest-paid stars, Matt Damon, as its spokesperson.

Blockchain innovation will fundamentally change the world like the internet did and will enable more people to participate. By replacing intermediaries, drastically increasing transparency, and putting more money directly into people's hands, it can fundamentally alter the power dynamics of the world and create infinite space for meaningful innovation and progress.

If after reading this article, you are convinced that it is time to start delving into Web3, then you are in luck. Since Web3 is still in its early stages, most information is free, so taking the time to learn is the most important thing you can do.

Most people ask me what investment portfolio they should buy, and my usual answer is to tell them to spend time learning. By understanding Web3, they will begin to learn how to invest in areas they find valuable. For example, I would suggest starting with the Bitcoin and Ethereum whitepapers. Both can be understood without a highly technical background, and they help explain the core arguments of Web3 in a simple and comprehensible way. They are great starting points for any beginner, and they remain documents that experts in the field review time and again. If you haven't read them yet, now is a good time to start.