What is Web 2.0?

Wikipedia has the following definition of Web 2.0:

“Web 2.0 encapsulates the idea of the proliferation of interconnectivity and interactivity of web-delivered content. Tim O'Reilly regards Web 2.0 as the way that business embraces the strengths of the web and uses it as a platform. O'Reilly considers that Eric Schmidt's abridged slogan, don't fight the Internet, encompasses the essence of Web 2.0 — building applications and services around the unique features of the Internet, as opposed to expecting the Internet to suit as a platform (effectively "fighting the Internet"). In the opening talk of the first Web 2.0 conference, O'Reilly and John Battelle summarized what they saw as the themes of Web 2.0. They argued that the web had become a platform, with software above the level of a single device, leveraging the power of "The Long Tail," and with data as a driving force. According to O'Reilly and Battelle, an architecture of participation where users can contribute website content creates network effects.
Web 2.0 technologies tend to foster innovation in the assembly of systems and sites composed by pulling together features from distributed, independent developers.“ AIIM defines Web 2.0 similarly in that Web 2.0 technologies provide the means and tools for organizations to leverage the Internet as part of their enterprise platform and architecture. Many organizations see value in using Web 2.0 tools or social software within their organizations for improved collaboration and innovation, and this is then often referred to as Enterprise 2.0. AIIM defines Enterprise 2.0 as a system of web-based technologies that provide rapid and agile collaboration, information sharing, emergence and integration capabilities in the extended enterprise.
Social software for an enterprise must according to Andrew McAfee, Associate Professor, Harvard Business School have the following functionality to work well:

1. Search: allow users to search for other users or content
2. Links: group similar users or content together
3. Authoring: include blogs and wikis
4. Tags: allow users to tag content
5. Extensions: recommendations of users or content based on profile
6. Signals: allow people to subscribe to users or content with RSS feeds