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Web 2.0 is the network on which individuals contribute to the development and distribution of tools, contents, and software applications over the Internet. This concept enables a huge increase in the complexity of e-commerce development. For example, various innovative business models have emerged from the largely spread-out technological concept, providing different values to customers as well as service providers. The objectives of the study are to explore and exploit Web 2.0 services in knowledge management for businesses. We adopt a KM perspective to explore the Web 2.0 challenges that service providers face in harnessing knowledge. More than one thousand sites of Web 2.0 applications were analyzed and classified and five types of business models were identified: exchanger, organizer, aggregator, collaborator, and liberator. These different types of Web 2.0 applications reveal the diversity of existing Web 2.0 applications as well as the risks and benefits associated with knowledge management of Web 2.0, and they provide a better understanding of the operating patterns and value propositions of the technology.