This is an almost impossible question to answer, if only because the term was created by Tim O’Reilly as a way of reaching out towards a cluster of phenomena and pointing out their links. In other words it was originally a rallying cry rather than a definable term.

In November 2005 The Register held a sarcasm-fuelled contest to define the phrase, in which contestants had to complete the sentence “Web 2.0 is made of …” My favourite response is from someone called Shaun Rolph. It says:

Web 2.0 is made of stardust; it is golden; it’ll help us get back to the garden

In the U.S.A, according to an article in VentureBeat, “investments in Web 2.0 were virtually unchanged from the first half of 2006, with 67 deals and US$357 million invested, according to a survey by Dow Jones VentureOne and Ernst & Young”.

More interestingly, for my purposes, the article quotes the definition of Web 2.0 that was used in the survey:

Here’s the definition of Web 2.0 used by the survey: “Companies included in this study have a business model that revolves around a dynamic interface facilitating participation through such methods as user-created content, networking, and collaboration. Applications include podcasting, tagging, blogs, social networking, mashups, and wikis. Technologies used in these applications include: AJAX (Asynchronous Javascript And XML), RSS, SOA, CSS, XHTML, Atom, and rich Internet applications.”

Bryan Alexander provides a more detailed look at what Web 2.0 is (or could be construed as being) in a paper called Web 2.0: A New Wave of Innovation for Teaching and Learning?, published at Educause.

Later that same year…

While sitting at LoW4 multi-tasking I found a long video-clip of Tim O’Reilly himself explaining what Web 2.0 is. It should be embedded above this very paragraph.

Should this not be the case, you can find it here at YouTube.