Two weeks ago, I wrote a post, “Social Tagging, What to Think?” Since then I’ve begin to come around to believe its power and potential importance in how information and content will be stored and retrieved on the web in the future. What I am still uncertain about is how exactly this notion is going to manifest itself from a geek buzz item into a service that my mother can and would use. And how a company or companies are going to make money off of it.

Today “A-list” blogger VC Fred Wilson posted his reasoning for his investment in del.icio.us, the now famous collective bookmarking site. I think that his fundamental premise is sound: “We believe tagging is important, its here to stay, del.icio.us is a very important participant in the tagging phenomenon, and we are really excited to be part of its development.”

The portion of his post that I think is more interesting reads as follows: “The question everyone asks is ‘what is the business model’. To be completely and totally honest, we don’t yet know. This was a seed investment and none of the investors put up very much capital. Joshua retained complete control of the service and is going to focus on making it better. That is all anyone wants to see happen right now. In time it will become clear what the business model should be. And there are a number of them to choose from for sure.”

Hmm… does this sound reminiscent of talk from the last bubble? Are these Bubble 2.0 words? To be honest, I am still conflicted on the how big this social tagging / social bookmarking / folksonomies “phenomenon” will be and what the right way to approach it is from an investor standpoint. BUT, Fred is indeed a true visionary in the digital media space, and is placing his chips in something that he believes in. That, I can agree with.