Net Results: In a lowly-lit black theatre space, venture capitalists and business advisers more used to heavily padded office furniture are perched uncomfortably on narrow tiered seating. Sprinkled through the room, which is normally home to experimental theatre rather than business conferences, are some techies in the standard-issue uniform of T-shirt and jeans, writes  John Collins

In the middle of the room, a tall overweight American dressed in a dark Hawaiian shirt and baggy black pants is sounding off on the state of the web. Phrases such as "make your nipples go hard" and four-lettered expletives are peppered through a speech that begins with a James Joyce quote and covers George Bush's foreign policy and how Apple and Microsoft are the enemies of innovation.

And of course all of this is being sponsored by our State business development agency, Enterprise Ireland. Welcome to the weird and wacky world of "Web 2.0", the tag that is being applied to the resurgence of internet-focused businesses, is the talk of Silicon Valley and seems to have the tech community on this side of the pond pretty fired up as well.

One hundred and fifty people turned up to last week's conference at DCU on Web 2.0, with many more interested attendees turned away. Speakers included the American described above, Marc Canter, who founded Macromedia and now runs Web 2.0 shop Broadband Mechanics; former MSN Europe chief and O2 board member Judy Gibbons; Silicon Valley angel investor Jeff Clavier; and representatives of UK venture capitalists 3i and Dresdner Kleinwort Wasserstein.

Any technology-related event that gets 150 movers and shakers to give up their day has been pretty rare in recent times, but when you consider it was on a topic that 99.999 per cent of web users have probably never heard of, it's even more impressive.

While Web 2.0 may not yet be mainstream, mention websites like MySpace.com, YouTube and Bebo, and both the net intelligentsia and the man in the street will know what you are talking about.

Rather than the first generation of the web, where publishers created websites that were consumed by users, Web 2.0 is all about creating a community of users who create and share their own content with other users. In fact, it seems that even the word "consumer" is not politically correct in the Web 2.0 world - Gibbons corrected herself after using the term. She made the point that users have all the power on the internet as they are just one click away from never using a service again.

This democratisation is possible because tools such as blogs and wikis make it extremely easy for even non-technical users of the web to start creating their own content. Support for open-source and open-standards software by the new wave of companies is also a key trend. This has led to a new phenomenon of "mash-ups", where programmers take data from one source, eg Google Maps, and merge it with data from another, eg real-time data on the location of Dart trains, to create a new service (check out http://dartmaps.mackers.com/).

Canter was critical of Google, which is for many one of the champions of this new way of looking at the web, for exactly that reason. "I don't trust Google because for every opportunity they have to be open, they aren't," said Canter. "They are doing all the things that we are doing; they are just doing it themselves privately."

It has been said that there are an awful lot of similarities between the initial web bubble and Web 2.0, and Gibbons admitted there was a lot of "exuberance" around. All this talk about building communities sounds eerily familiar to the "getting eyeballs" that fed advertising revenues first time around. And while there is little talk of floating on Nasdaq these days, many of the leading lights in the Irish Web 2.0 scene are clearly hoping one of their firms will get a big payout from Google or Yahoo!, who have been snapping up firms such as Flickr, Writely, and del.icio.us.

Clavier also said that the cost of entering the game this time around has been significantly reduced. While the average VC-backed dotcom may have burned through $3 million (€2.38 million) to build and launch their service, a Web 2.0 venture typically launches with a budget of less than $100,000. Consequently, as Clavier puts it, "the cost to failure" is much lower.

A common theme for all the speakers was that any Web 2.0 service needs multiple sources of revenue - generally some mix of advertising, subscriptions and e-commerce. They also made the point that a radically new idea is less likely to succeed ("there are no new ideas," claims Canter) than a twist on well-executed existing services .

Seven Irish companies - Nooked, Tablane, Infacta, Sxoop, Herbert Street Technologies, Inner Workings and Alatto - made short presentations, no doubt hoping to impress visiting VCs and local financiers. (In the interests of full disclosure, I was asked to introduce the morning showcases, having written previously in these pages about the companies.)

While Enterprise Ireland has always been praised for its financial and business support of technology start-ups, it is encouraging that it is spotting a new technology and business trend still in its infancy. The attendance at the event and the buzz on Irish blogs before and after suggests that the State agency is tapping into a groundswell of interest among Irish entrepreneurs and techies.

One or two of the Irish companies in this space may sell out to a bigger player for a nice multiple. Others may generate a healthy income for their founders and a small team of staff. Whatever the outcome, the State agency seems to have cottoned on that Web 2.0 is an ideal tag to market the next generation of innovative Irish software companies.

John Collins' blog is at http://taggingtech.typepad.com