The sharp economic downturn slowed donations, but broadly speaking there was less pressure for new hardware investments because hardware innovations in 2008 tended to be incremental (e.g. netbooks, introduced in 2007, have become smaller and cheaper; new versions of the iPod and iPhone; faster broadband). In other words, there was no new "must have" hardware technology in 2008.

At the same time, there were major shifts in Web-based software usage, as established social networking applications stabilized (Twitter, for example, came through some major mid-year downtime crises to be sturdier than ever) and robust (LinkedIn, the professional networking site, introduced new applications late in the year; Google Docs became sleeker while adding many new features to its office-style suite of word processing, presentation, and spreadsheet software).

Obama's Campaign Shows the Way
Barack Obama's historic presidential campaign broke fundraising ground that's difficult for nonprofits to ignore, says nonprofit technology trainer, coach, and consultant Beth Kanter. "Particularly with the use of social networks and social media that we saw in the election campaign, there's probably less skepticism and it's paving the way for broader adoption. There's definitely a stronger interest in [social media], and more of a shift in attitude. This year it's more of a 'We really need to think more about a social media/social networking strategy, and how it fits within our communication plan,'" says Kanter.

The problem remains, says Kanter, that "organizations still need to approach social networking strategically, and not be attracted by 'shiny object syndrome.'" But the good news, says Kanter, is that there are many more social media "experts" than there were just a year ago, reflecting the tools' increased usage. As a result, free-agent activism -- people who are fundraising or publicizing a cause outside of the context of an institution -- has become more accepted in the past year.

As an example, Kanter cites the Chicago Symphony, which has its own Facebook page, and also has several unofficial "fan" pages on Facebook, like this one that celebrates trombonist Charlie Vernon and includes comments about how he "rips ass in lessons" and "plays the trombone like a badass." When Kanter asked Chicago Symphony Orchestra PR chief Marc van Bree about these "rogue" pages, he said it, and other CSO fan pages, don't bother him a bit. "The people who started those groups are obviously passionate about supporting the CSO," van Bree told Kanter. "Reaching out to these people works very similar to reaching out to bloggers; know who is writing and what they are writing; participate; build relationships; and adapt materials."

He might have plenty of time to do this, says Kanter, who says she hopes the economic downturn will cause nonprofits to "examine what they're really doing, and how they're using technology and making sure they're as effective as possible. The biggest cost in social media is your time, especially at the beginning."

Kanter also says that individual connections are one of the latest "tech" trends, citing the increasing proclivity of people both to post important new links via Twitter, and also to "crowdsource" questions and problems -- to ask their Twitter network for possible solutions to problems. "Our friends are the new hyperlinks," she says. "That's what's making the world smaller."

Software as a Service
Sonny Cloward, a business systems analyst with the Rainforest Alliance, says the big picture trends in the nonprofit tech sector are "consolidation and convergence." He cites as examples Blackbaud's purchase of Kintera and Convio acquisition of GetActive. This results, to some extent, in greater integration, says Cloward.

Another major trend, he says, is the use of Software as a Service (SaaS), which means, in short, that nonprofits are increasingly using software that is hosted on a remote server -- and they're storing their data on remote servers, too. "It reduces maintenance, upgrading, and system requirement costs of client-side applications," he says. "And it's opening up data portability, so that data can be used across applications."

He also saw 2008 as a year in which nonprofits began to embrace social media, but that they're still trying to figure out how to leverage it. "People jumped on the bandwagon without understanding how it fits into a larger organizational strategy," he says. "They're using the same tactic that many nonprofits did with Web sites 10 years ago -- 'If we build it, they will come.'"

Strategy, rather than new investment, will be key in 2009, says Cloward. "With the economy the way that it is, I think many organizations will cut back. Tech is often the first to go. But I'm curious if with greater layoffs in the tech sector if there will be a larger pool of tech-savvy people to hire/leverage as volunteers."

If so, says Cloward, nonprofits have to be more open and be ready to take advantage of such opportunities.

Cloward also says he's keeping an eye on micro philanthropy this year. One example of this is Kiva, which enables individuals to make loans to entrepreneurs in developing nations, opening up a capital stream where none existed before. Another cited by Cloward is Social Actions, which aggregates opportunities for donors and volunteers to contribute to a wide variety of nonprofits in many different ways. "It seems to have the ability to have a broader reach than siloed campaigns," says Cloward, "for people to find exactly what they are looking for. It's not 'top-down,' which, in my opinion, democratizes social change."

The Bottom Line
Thanks to new, sobering economic realities, 2009 is likely to be a year of retrenching in the nonprofit technology sector. While this isn't good news for Non-Profits who are in sore need of hardware backups, relatively new Web 2.0 social networking software can help make up for the shortfall. Without the need to install new hardware, nonprofits will have more time to explore the possibilities inherent in social networking, and fortunately they can do it at a cost that's high in hours -- but very low in dollars.