Web 2.0 has always been one of those nebulous concepts that has been difficult to concisely define. Each person seems to have a slightly different idea about what is and is not web 2.0. Tim O'Reilly's original essay, What is Web 2.0, was quite lengthy, and he is now trying to define web 2.0 using a short, easy to remember definition:
Web 2.0 is the business revolution in the computer industry caused by the move to the internet as platform, and an attempt to understand the rules for success on that new platform. Chief among those rules is this: Build applications that harness network effects to get better the more people use them. (This is what I've elsewhere called "harnessing collective intelligence.") (Quote from Tim O'Reilly on O'Reilly Radar).
I am not sure that this is a business revolution as much as it is a consumer revolution that businesses can take advantage of by building “ applications that harness network effects to get better the more people use them.” I think the key to web 2.0 is how the expectations of the users are changing. Only a few years ago, most consumers saw the Internet as a passive medium, like radio and television, to be watched and enjoyed without any direct involvement. Many consumers now expect to be able to participate in the online environment by commenting, uploading, or participating in the content in a number of ways. I think that the key to web 2.0 is consumer driven participation and interactivity. Businesses need to understand this fundamental change and focus on building online participation into their business models.
I do think that O'Reilly has a great start toward a more concise definition of web 2.0.