The Dynamics Between Web 2.0, Semantic Web, and Financial Markets
A theme which has recently been gaining increased importance for both Web 2.0 companies and financial investors alike is the interaction between Web 2.0, Social Networks, and Wall Street. The Semantic Web also has a role to play in this scenario. This post will give some insights on this topic, being based on concepts presented at the O’Reilly Money:Tech conference, which was held on 6-7 February in New York. One of the most relevant events for those working in the Semantic Web was Tim O’Reilly’s interview with the upcoming CEO of Reuters, Devin Wenig, who emphasized that the Semantic Web will play a pivotal role in Reuters’ future.
The Money:Tech conference was aimed towards a diverse audience: on the financial side, hedge fund managers, equity, financial and investment analysts, investors, managers, and entrepreneurs, and on the technological side, technologists, as well as academics. The main focus of the conference was to highlight that Web 2.0 is a useful source of data for investors, and more specifically, the tools to extract meaning from this data for money management. Focusing on this topic shows the utility of Web 2.0 and Social Networks to expose trends in financial data. The coming together of financial experts and Web 2.0 innovators and the fusion of their ideas provides insight and value creation for technology advances in the investment industry. An example of a presentation which discussed such issues was: “Main Street Research Meets Wall Street: How Social Networking is Transforming Online Investing”.
Moving from Web 2.0 and Social Networks to the Semantic Web, in his blog, Tim O’Reilly discusses some developments in how information will be delivered to the consumer, which were presented by Devin Wenig in his interview at Money:Tech. Changes in the methods of data delivery are relevant for all types of news, but particularly financial news sources, as they are volatile. A first point which Wenig highlighted was his awareness that textual information has been replaced by the formats of data desired and controlled by consumers of Web 2.0, such as video and interactive applications. Secondly, Wenig claimed that we are coming to the end of an era where the company with the least time delay in delivering news held a competitive advantage. This second point exposed a very important trend for the future of news data: that the timing of news is no longer a crucial factor, but rather the sources of the news and the information which can be derived from connections between them. In other words, the processing of the data. This is where the Semantic Web steps in. The aim is not just to mark data with semantic metadata, but to use the semantic data to derive added-value additional information from the original data for the consumer, where the consumer may be another news company, or the end consumer. Thus, the focus is on making insights from the data through semantic technology.
O’Reilly’s discussion of Devin’s point is of essential importance. Why? Because he emphasizes the purpose of adding metadata to news items for further processing. Semantic annotation itself is useless if it cannot be reused by Reuters, other news companies or financial investors. For example, it could be used to determine the connection between a news item about the fall in the share price of a particular company and a fall in oil prices.
O’Reilly agrees with changes in consumer media impacting on the structure of professional media. However, he does not see the end of exploiting opportunities for zero-delay information delivery to the consumer, and even more importantly, getting access to the correct sources of data to extract overlooked information. This provides the consumer with more relevant information. But, the process is still contingent upon a degree of human interaction with the data (the curation process). Subsequent semantic annotation of this data may then unlock previously concealed connections.
http://radar.oreilly.com/archives/2008/02/reuters_semantic_web_moneytech.html
http://en.oreilly.com/money2008/public/content/home
Tags: consumer media, financial markets, money:tech, o'reilly, professional media, reuters, Semantic Web, web 2.0