Business 2.0 market to reach £2.3bn by 2013

Investment in Web 2.0 for business will swell to £2.3bn over the next five years

Global investment in Web 2.0 tools for the business market will rise to $4.6bn (£2.3bn) by 2013, growing at an annual rate of 43 per cent.

But while this steady growth will attract new businesses, the sector may begin to dwindle after the next five years, according to Forrester research.

The relatively cheap nature of business in the Web 2.0 market means that revenues will always be dwarfed by the multi-million dollar revenues of the software industry, said analyst G Oliver Young. But there are still clear draws to investing in the market.

"While the $4.6bn figure is relatively small when compared with other sectors, the Web 2.0-for-business market will be attractive to a lot of startups," he said.

"Advertising revenue has been hard to come by, with even sites such as Facebook finding it hard to monetise their high volumes of traffic. Companies are now looking over the fence to the business market, where even revenues of $50 per user per month are looking increasingly appealing."

But after five years of solid performance, investment in the sector will begin to slow as Web 2.0 applications become increasingly prevalent, and become absorbed into collaborative software packages.

"By 2013, the market for blogs and wikis will be mostly saturated," said Young. "Tools such as mash-ups and widgets will still be growing quite aggressively, but in general the sector will start to slow down as the price-per-deployment falls."