It's not a new question, I know. And on the face of it, it may not seem terribly relevant to the average CIO, working for businesses which are generally wiling to pay for the services they consume. But I maintain that the question of whether or not all these free-to-use, ad-revenue supported Web 2.0 sites are sustainable under their chosen models is more important to corporate IT than you might initially imagine.

It's also not news that many of these sites exist not so much from their own innate value and revenues as by the largesse of investors, investors who are no doubt hoping for another Amazon revolution. As you may or may not recall, Amazon burned money like kindling for the early years of its existence, taking losses quarter after quarter despite significant skepticism, fueled by the conviction of Bezos and his investors that eventually the market would revolve around the position they had staked out and the fundamental strengths of the company would start to pay off. They have now, in spades, and Amazon has proven it can be done. But that's different from proving that it must eventually happen for any business with dim prospects as long as you stick it out long enough; the littered battlefield of the dot-com era illustrated that clearly enough.

So Twitter, Facebook, and the like have become massive successes in terms of users, but like Amazon of old, they have yet to turn those users into profitability. Slate's Farhad Manjoo runs some of the dismal numbers here. Manjoo's point is that so far, sites with professionally produced content have been able to either charge directly or maintain advertising rates high enough to support themselves, while those with user-driven content have not. That may be good news for professional content producers, but it's not great from the perspective of the state of the art; MLB.TV may be a sustainable business but they aren't exactly pushing the boundaries of modern technology and its uses the way that YouTube has. Twitter doesn't make a dime, but they've opened up the field of micro-messaging in ways that no professional producer has done.

This is where the CIO should be concerned, because the business applicability of many of these free or ad-supported platforms seems inevitable, if yet poorly defined. Some of the concepts can be reproduced as internal services; some cannot. But either way, does anyone think that these ideas would even come to our attention without their popular success in the larger proving ground of the consumer market? It's not inevitable that good ideas will find a way to monetization. Does anyone remember Kozmo.com? Ten years later, no one has been able to reproduce the simple utility of what amounted to an on-call convenience store delivery service. Internet-based home grocery delivery has made a limited comeback, but there has been no new Kozmo. While it was convenient, it wasn't convenient enough to become a must-have for users. In the same way, YouTube or Twitter are neat, but we all lived in a world without them for a long time, and they aren't like, say, electricity, in their utility. They are just fun for most people, and all those people have alternatives when it comes to fun.

For businesses, they may be genuinely useful. But the real question is, would you have come up with those ideas on your own? Because the failure of this generation of innovative services might have a significant chilling effect on investment in the next.

I don't have any answers or suggestions for avoiding this situation but it's something to consider and keep an eye on for strategic technology decision makers. R&D has effectively been outsourced for the past decade or more, quite successfully. A string of high-profile failures in the consumer internet market might put a damper on that state of affairs.