The Year Online

Socializing Networks

Our collective obsession with social-networking sites continued in 2008, as did their search for a viable business model. Although economic conditions have been grim for the industry in the past few months , enthusiasm for the sites continues to run high. Twitter, a popular but non-money-making poster child for the whole Web 2.0 industry, spawned an ecosystem of competitors, knockoffs, plug-ins, and add-ons, some of which struggled to stay afloat as the site strained under the ever-increasing amount of data produced and requested by its users. Users themselves struggled to manage information overload from multiple social-networking services, prompting some companies to come up with ways to streamline by sharing data. However, one of the biggest networks, Facebook, took a different approach: it carved out a position apart from its competitors.

Into the Cloud

Amid the economic turmoil, some good news was that Web companies became cheaper to start than ever before: they could simply lease access to computer power from a growing list of "cloud computing" providers. On the other hand, since many infrastructure services are offered by large companies such as Amazon and Google, this raised questions about smaller companies' increasing dependence on these giants. (See "Web App Writers: Rejoice, Beware.") Amazon's popular storage service also began functioning as a way to draw companies into relying on more and more of Amazon's offerings. And a variety of open-source solutions jumped into the mix, hoping to make it easier for companies to understand how these infrastructure services work, while, in some cases, also grabbing a bit of market share for themselves. Meanwhile, the old guard rushed to catch up. Apple's MobileMe stumbled initially, and few people seem to understand what Microsoft's LiveMesh was supposed to do. But Microsoft is pushing hard to realize a plan in which cloud computing augments software rather than replaces it.

Patching the Internet

The core protocols that keep the Internet running were never designed for the kind of use that the Web gets today, and in 2008, the strain began to show. In particular, one system that showed its age was the domain name system (DNS), which translates the Web addresses typed into a browser into a numerical address that connects that browser to a server. It was designed in a more trusting era, and security researcher Dan Kaminsky discovered a major flaw in the system that had the potential to throw Web security into disarray. Companies scrambled to come up with a fix for DNS, but it wasn't the only protocol that needed an update. The border gateway protocol, which handles routing, has struggled under growing traffic. And experts are working to update the cryptographic algorithm that secures many online transactions, hoping to have a solution in place before the current system gets out of date.

Data Equality

The debate over network neutrality heated up this year, made more urgent by skyrocketing video and multimedia traffic. Even as Internet service providers and file-sharing networks struggle toward uneasy peace, the Beijing Olympics made it clear that the debate isn't just about money. Internet censorship continues, and free-speech advocates reported that the Chinese rules for censorship seem not to be uniform, leaving major search engines to set their own guidelines. An embarrassing incident involving the Chinese version of Skype showed that U.S. companies need to take care when forming partnerships within countries subject to censorship.