History
The concept of shared online bookmarking dates back to April 1996 with the launch of itList.com. Within the next three years online bookmark services became competitive, with venture-backed companies like Backflip, Blink, Clip2, Hotlinks, Quiver, and others entering the market. Lacking viable models for making money, most of this early generation of social bookmarking companies failed as the dot-com bubble burst. The contemporary concepts of social bookmarking and tagging took root with the launch of the web site oneview in 1999[1] and del.icio.us, in September of 2003.


Functional Overview
In a social bookmarking system, users store lists of Internet resources, which they find useful. Often, these lists are publicly accessible, and other people with similar interests can view the links by category, tags, or even randomly. Some social bookmarking systems allow for privacy on a per-bookmark basis.

They also categorize their resources by the use of informally assigned, user-defined keywords or tags (see folksonomy). Most social bookmarking services allow users to search for bookmarks which are associated with given "tags", and rank the resources by the number of users which have bookmarked them. Many social bookmarking services also have implemented algorithms to draw inferences from the tag keywords that are assigned to resources by examining the clustering of particular keywords, and the relation of keywords to one another.


Advantages
This system has several advantages over traditional automated resource location and classification software, such as search engine spiders. All tag-based classification of Internet resources (such as web sites) is done by human beings, who understand the content of the resource, as opposed to software which algorithmically attempts to determine the meaning of a resource. This provides for semantically classified tags, which are hard to find with contemporary search engines.

Additionally, as people bookmark resources that they find useful, resources that are of more use are bookmarked by more users. Thus, such a system will "rank" a resource based on its perceived utility. This is arguably a more useful metric for end users than other systems which rank resources based on the number of external links pointing to it.


Automatic Notification
Since the classification and ranking of resources is a continuously evolving process, many social bookmarking services allow users to subscribe to syndication feeds (see RSS) based on tags, or collection of tag terms. This allows subscribers to become aware of new resources for a given topic, as they are noted, tagged, and classified by other users.


Disadvantages
There are drawbacks to such tag-based systems as well: no standard set of keywords (also known as controlled vocabulary), no standard for the structure of such tags (e.g. singular vs. plural, capitalization, etc.), mistagging due to spelling errors, tags that can have more than one meaning, unclear tags due to synonym/antonym confusion, highly unorthodox and "personalized" tag schemas from some users, and no mechanism for users to indicate hierarchical relationships between tags (e.g. a site might be labeled as both cheese and cheddar, with no mechanism that might indicate that cheddar is a refinement or sub-class of cheese).

The separate (but related) tagging and social bookmarking services are, however, evolving rapidly, and these shortcomings could possibly be addressed in the near future.