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i dont think they will ever fade out, but their popularity has gone down. I think there is a natural behavior for the "first time surfer" who goes to a lot of different sites before bookmarking a few favorites.
As far as web 2.0, personally i think its more of a competition between webmasters than for surfers (free sites, not paysites). Im in between on thoughts because i think surfers like simple looking straight to the point sites, but at the same time, I want the site to look nice an attractive so the visitor fells "safe" and comes back
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