There is much talk these days that the new Web 2.0-fueled tech economy is getting dangerously close to bubble territory. The bubble believers see particular evidence of this in San Francisco, the city that was left for dead after the implosion of Web 1.0, formerly known as the Dot Com era.

My company, THUNDER FACTORY, is based in San Francisco, right in the middle of Web 2.0.  As I move around this stunning bay city, and travel within Silicon Valley just South of here, I must admit that the bubble signs are all over the place  You can see the hints of a bubble in the VCs taking meetings at Il Fornaio and Stacks with start-up wannabes, in the SOMA eateries popping up on every corner, and definitely in the Phoenix-like rise of the high tech PR firms (of course now they are integrated communications firms not just publicity mills…uh huh!).

In a recent Business Week commentary, Silicon Valley writer Sarah Lacy made a convincing case that, even with the parallels that so accurately recall the Dot Com slide in 1999, this new Internet-driven economy is in no danger of cratering. At least not any time soon.

While I agree with Sarah’s conclusion, I believe the new Web 2.0 economy is here to stay because of a key factor that can be captured in just one word: media.

The main reason why I am actually quite optimistic about the staying power of the new Web 2.0 economic engine is because it is so inextricably linked to the growing, global media revolution. That revolution is rapidly transforming how people the world over get and share information, news, video, radio, entertainment, music, etc. Web 2.0 is both benefiting from the revolution in media and helping to drive it.

Think about how radically different the media world is today vs. 1999 and the end of Web 1.0.  At that time, the iPod had not even been launched yet (Steve Jobs introduced it to much fanfare and some initial skepticism in October 2001). The "legal" downloading of songs had barely even begun (and the original "illegal" Napster was already history). Blogs, podcasts, vlogs, wikis, user generated content and other media related tools and platforms that are now becoming commonplace did not yet exist (or barely so). The precursors of the social networking sites were hanging on back in 1999, but just barely surviving. To be sure, the media world was already in the throes of major upheaval, but the changes taking place back then paled in comparison to what would come in just a few years hence.

Because of the profound transformation of the entire media environment that has occurred in the past couple of years (and that continues to accelerate), I am increasingly optimistic that there will be no repeat of the Dot Com implosion that helped to tank the US economy at the start of the new Millennium. The media revolution is having a fundamental effect on our culture, our economy, our institutions, and society overall. And the good news is that most of these changes are positive ones.

Web 2.0 is not just a casual player in this historic revolution. It is right in the center of things, capitalizing on innovative ideas, great initiative and yes, burning ambition, to create new opportunities and greater access for developing, delivering and consuming every form of media imaginable (and many not yet imagined).

That is a pretty good case for Web 2.0 being around for a long, long time — or at least until Web 3.0!

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