O’Reilly on Web 2.0 lock-in

Tim O’Reilly: “Chief among the future sources of lock in and competitive advantage will be data, whether through increasing returns from user-generated data (eBay, Amazon reviews, audioscrobbler info in last.fm, email/IM/phone traffic data as soon as someone who owns a lot of that data figures out that’s how to use it to enable social networking apps, GPS and other location data), through owning a namespace (Gracenote/CDDB, Network Solutions), or through proprietary file formats (Microsoft Office, iTunes). (“Data is the Intel Inside”)”

The users are pretty savvy and are all over this one already from what I’ve seen but I think Tim is ultimately right. For many applications that are moving to the Web or following this Web 2.0 paradigm ownership and portability of the data (or lack thereof) will drive the decisions from customers around which platforms lock-in users. This data lock-in may also provide a “moat” for vendors looking to hold on to customers or stave off competitors, at least for a while.