Web 3.0, the global brain and the impact on financial markets

July 5th, 2006

I have read some interesting posts in the last few days. These posts are listed below and a few extracts are provided. One of these posts was read by 60,000 people in the first week. I will extract some key quotes from the original and then offer a few comments on my area of interest - the internet and financial markets. I strongly encourage you to read the originals.

One of the core predictions in the posts is that search engines based on crude “keyword matching” ranked by popularity of each page will be superseded. They will be replaced by ontologies created by thousands of volunteers that are searched by intelligent robots launched from a user’s home computer. The results will be startling. Questions may be answered, rather than crude keyword matching.

Web 3.0 Vs Google, Marc Fawzi, 30th June 2006

Extract:

The Global Brain, in the context of Web 3.0, is the distributed artificial intelligence (Distributed AI, aka P2P AI) that will emerge from the almost-infinitely parallel interactions between hundreds of millions of AI Agents.”

Web 3.0 will bring with it a shift from centralized search engines to P2P AI Engines, which will collectively have vastly more deductive power, in both quality and quantity, than Google can ever have (included in this exclusion is any future AI-enabled version of Google, as it will not be able to keep up with the distributed P2P AI that will be enabled by billions of users running free P2P AI Engine software on their home PCs.)

Knowledge domains: A knowledge domain is something like Physics, Chemistry, Biology, Politics, the Web, Sociology, Psychology, History, etc. There can be many sub-domains under each domain each having their own sub-domains and so on.

Information vs Knowledge: To a machine, knowledge is comprehended information (aka new information produced through the application of deductive reasoning to exiting information). To a machine, information is only data, until it is processed and comprehended.

Ontologies: For each domain of human knowledge, an ontology must be constructed, partly by hand [or rather by brain] and partly with the aid of automation tools. Ontologies are not knowledge nor are they information. They are meta-information. In other words, ontologies are information about information. In the context of the Semantic Web, they encode, using an ontology language, the semantic relationship between the various terms within the information, i.e. how they relate to each other in a meaningful context (e.g. a tire is part of a car, so tire and car are semantically related.)

The distributed AI (or the collection of collaborating AI Agents, aka “P2P AI”) that will form the so-called Global Brain in Web 3.0 will not be owned by any one entity.

Anyone will be able to tap into an AI matrix, made up of millions P2P AI Engines running on the users’ home PCs, where the “search” function will be redefined as “intelligent deductive reasoning”, i.e. “thinking.” So there will be no need for a central search engine anymore, and not even a central AI engine like Google may be working on.

Wikipedia 3.0 the end of Google?, Marc Fawzi, 26th June 2006

Extract:

The Semantic Web (or Web 3.0) promises to “organize the world’s information” in a dramatically more logical way than Google can ever achieve with their current engine design. This is specially true from the point of view of machine comprehension as opposed to human comprehension.The Semantic Web requires the use of a declarative ontological language like OWL to produce domain-specific ontologies that machines can use to reason about information and make new conclusions, not simply match keywords.

However, the Semantic Web, which is still in a development phase where researchers are trying to define the best and most usable design models, would require the participation of thousands of knowledgeable people over time to produce those domain-specific ontologies necessary for its functioning.

The problem with the Semantic Web, besides that researchers are still debating which design and implementation of the ontology language model (and associated technologies) is the best and most usable, is that it would take thousands or tens of thousands of knowledgeable people many years to boil down human knowledge to domain specific ontologies.

However, if we were at some point to take the Wikipedia community and give them the right tools and standards to work with (whether existing or to be developed in the future), which would make it possible for reasonably skilled individuals to help reduce human knowledge to domain-specific ontologies, then that time can be shortened to just a few years, and possibly to as little as two years.

The emergence of a Wikipedia 3.0 (as in Web 3.0, aka Semantic Web) that is built on the Semantic Web model will herald the end of Google as the Ultimate Answer Machine. It will be replaced with “WikiMind” which will not be a mere search engine like Google is but a true Global Brain: a powerful pan-domain inference engine, with a vast set of ontologies (a la Wikipedia 3.0) covering all domains of human knowledge, that can reason and deduce answers instead of just throwing raw information at you using the outdated concept of a search engine.

It is very difficult to find information in financial markets. Financial information can not be “googled”. Keyword matching simply doesn’t help find an adviser for your business, an equity research report on a company, a financial product that meets your unique needs. Information is distributed through closed systems. Even if the data had a common structure that could be searched, the market participants would not allow it. The lack of metadata around information and closed information systems ensure financial markets remain a highly profitable industry.

In Web 2.0, the information could be organised into structured databases at a single location made available over the internet. Web 3.0 still relies on structured information and a single repository (source from distributed locations). Web 3.0 must still be organised and intelligent agents may be able to answer your questions - “Which corporate adviser should I use to list my Web 3.0 company in Bermuda?” and “What are my chances of getting liquidity?”. It will be very interesting to see what type of answers Web 3.0 will give us? Web 3.0 won’t cause a change in financial markets, but it may provide the technology to facilitate change far greater than anyone has anticipated.

This is worthy of further comment. After some further thought, I may edit this post over the next few days.

Entry Filed under: Online networks vs. industries, Economic development, Boom then depression by 2012