Google has shut down Lively, a service where people log on to chat and explore 3D virtual spaces, after a few short months. The MBAs of Silicon Valley have a pat phrase for the arrival of a competitor on the scene: They say it "validates their space." What does it say, then, that Lively is gone? It means that Second Life, the best known of these unreal universes, is doomed, too.The notion of a metaverse has long fascinated geeks. The idea of "avatars" — three-dimensional representations of the self rendered in pixels, often fantastical or surreal in nature — wandering through a computer-generated environment has been explored in the science-fiction novels of Neal Stephenson, William Gibson, and Bruce Sterling, among others. The Matrix trilogy introduced the idea at multiplexes from coast to coast. And yet unreal worlds have never taken off in actual reality. Philip Rosedale, the creator of Second Life, once showed me screens at the headquarters of his company, Linden Lab, which monitored in real time the number of people logging in. They peaked at 50,000, the maximum simultaneous capacity of its servers. That's not a virtual world; that's a midsized town. Anecdotally, many of Second Life's users are there for virtual sex. (The company has banned gambling, so there's little other reason to go there.) The PG-rated Lively, censored by Google, did not even have that; its only draw was innocuous chat, with the occasional subversive attempt by users at raciness. No wonder that news organizations, drawn by the visual appeal of the service's 3D graphics, aren't writing stories about Second Life anymore. Reuters, at the height of the frenzy, opened up a bureau; its Second Life correspondent stopped filing copy since September, having left to write for a blog, and the wire service has not replaced him. The most recent noise to come out of Second Life has been an uproar over price hikes. Second Life users periodically hold colorful protests in the virtual world — probably the most entertaining thing that ever happens there — over this new rule or that new rule. They are likely to become more frequent, as Linden Lab, to survive, focuses on squeezing more revenue out of its existing customers, who pay the company "taxes" on their virtual real estate and convert real money into the company's imaginary currency, Linden dollars. Online 3D environments are not a fad; millions inhabit them for hours, sometimes days at a time. But they do so in networked videogames like World of Warcraft, where there's a clear purpose to being there — even if it's just having fun and wasting time. Second Life, Lively, and virtual worlds like them amount to glorified chat rooms, and while chatting is a fundamental human activity, it's hard for anyoen to make money on it.
A boilerplate statement from Linden Lab confirms yesterday's rumor: "We've had to make some hard decisions about resources and as a result we eliminated four positions out of our headcount of nearly 300." That's not as bad as the "9 or 10" we'd been told were cut. In a statement sent to Silicon Alley Insider, Linden says they're still hiring. There are 45 job listings on the company's employment page. Are they all still open? Huh, maybe Second Life really is an alternate reality. What temperature does water boil at in SL?
A tipster reports that Linden Lab, the maker of virtual world Second Life, is laying off its business-development department, which had cultivated ties with software makers. The move affects "9 or 10" employees," he says. A wise move, if tardy: Don't you need to have a business worth developing before hiring someone in business development?
CAMBRIDGE, MASS. — Does Xerox CTO Sophie Vandebroek have trouble with basic numberwork? At MIT's EmTech conference, she asked the audience how many people had "avatars" — digital characters for virtual worlds like Linden Lab's Second Life. From what I saw, half a dozen people out of some 300 attendees raised their hands. "Perhaps 25 percent!" she said, as she played a video showing off Xerox's presence in Second Life. I am not sure what is more disturbing: Vandebroek's miscounting, which one might blame on the bright stage lights, or her inability to calculate the lack of a return on investment in Second Life, which has no such excuse. Here's a clip of Vandebroek talking in Second Life:
Virtual worlds are endlessly mutable. As are the wildly implausible schemes their boosters concoct for making money off them. The latest idea Linden Lab has for Second Life: Profit, in some vague, unspecified way, from the world's free 3D design tools. The perpetually gullible BusinessWeek bought this story, pointing to examples of toy designers and architects building digital models and showing them off to customers in Second Life. There's a certain beauty to it: An entrepreneur's fantasy, used to peddle other entrepreneurs' fantasies. Not that there's much of a business here, since Linden Lab gives away its design software.It does suggest a graceful exit strategy for Linden Lab's investors, which include Benchmark Capital: They should persuade Autodesk to buy the company before its free design tools erode the market for that company's profitable design software. Not that I think that Second Life actually poses a threat to the AutoCad franchise — just that Mark Kingdon, Linden's adman-turned-CEO, is slick enough to make the pitch.
Taking a page from Nebraska's Internet cops, U.S. Representative Mark Kirk (R.-Ill.) has created a fake teen of his own in order to protect real ones. While promoting a bill to restrict access to social networking sites in public schools and libraries, Kirk and Illinois law enforcement detailed the solicitations received by the imaginary 15-year-old female they played in Second Life — to enter "rape rooms," among others. Acknowledging that there were no known cases of sexual assault on underage users at Second Life, Rep. Kirk still called the site an "emerging danger." Now with the addition of his fictional sex-seeking teenage avatar, of course. (Photo by Daily Herald)
Linden Lab, which operates the Second Life virtual world, has found a new CEO: Mark Kingdon, the longtime chief of Organic, an online ad agency. A bizarre move for Linden, and seemingly for Kingdon. Sophisticated marketers, having toyed with Second Life, agree that it's a nonstarter as an advertising medium. Linden Lab makes its money from serving as a virtual central bank and a taxing authority. IBM is interested in it largely as a substitute for teleconferencing. Philip Rosedale, the founder and outgoing CEO, is a dreamy technologist, but replacing him with an adman makes no sense. An enterprise-software salesman would have made more sense.
Pictured is a screen capture of the avatars assembled in Second Life for
yesterday's last week's congressional hearing about virtual worlds. Why is congress giving Linden Lab the time of day? Terrorists, silly! According to Jane Harman, D-California, "Islamic militants are suspected of using Second Life, the Internet virtual world, to hunt for recruits and mimic real life terrorism." That's quite the bait to dangle in front of congress for free publicity, Linden Lab PR team! Full clip from the Daily Show after the jump.
As a business, Second Life is a bust. As a technology, the virtual world is a joke. Using snake-oil metaphors to describe it would seem an injustice against toxic cure-alls — were that not Second Life's new marketing peg. The autistic and near-autistic with Asperger's syndrome are flocking to Second Life to learn how to interact with other human beings, CNN reports. This follows Newsweek's discovery last July of Second Life as therapy for the housebound. A suggestion for Benchmark Capital and the other VCs who sank money into this boondoggle: Why not market it as the next Prozac, and sell it to Eli Lilly? That seem easier.
Despite a silver-tongued PR team capable of spinning any irrelevant Second Life happening into a New York Times story, former Linden Lab CEO Philip Rosedale couldn't save himself from the downside of the virtual hype cycle. His "life's work" has become a punchline. Here are the five mistakes that added up to cost Rosedale his job.
Linden Lab CEO Philip Rosedale is stepping down as CEO. The Benchmark Capital-backed company is looking for a new chief with more operational and management experience. "This is my life's work. I'm not going anywhere, and I'm still full-time on this, probably for the rest of my life," says Rosedale, shown here as his Second Life alter ego. The story was broken by the Reuters Second Life news center within Second Life. This is likely the only news ever broken by the bureau that you'll care about.
"Second Life is slowing down and taking investors with it." — Blogger Adrian Crook during his "Free to Play" panel at the Game Developer's Conference. He says businesses in the virtual world are being forced to shut down because there isn't the population to support them.
Tonight's events are great for networkers and job-seeking developers: The San Francisco Business Times is hosting a reception for their 2008 Book of Lists, while Linden Lab (of Second Life fame) is holding a recruiting event at their new Mountain View digs. The Lists party at the Four Seasons in San Francisco is sold out (crash it!), but RSVPs are still available for the Linden Lab event.
Gavin Newsom, San Francisco's freshly reelected god-mayor, descended into the bowels of Second Life for a quaint fireside chat with Philip Rosedale, CEO of Linden Lab. What lofty matters could a city mayor and the chieftain of a seamy virtual world possibly have to discuss? Why, the parallels between the "two famously diverse and tech-savvy communities with global profiles," of course. As Newsom said during their discourse, "We're all geeks." But the comparisons don't stop there. San Francisco is exactly like Second Life.
How else to explain the Linden Lab CEO's waxy complexion? He's the unending leader of an unholy company which laughs at death, and sustains itself through artificial means — PR, that is. To maintain that unhealthy glow, he's preying on unsuspecting technology journalists, sucking out all common sense and journalistic curiosity and turning them into willing propaganda puppets. His silver tongue already scored a succulent piece in the BBC, and now David Kirkpatrick of Fortune has fallen under Rosedale's sway.
Just when things turn bleak for Second Life maker Linden Lab — CTO Cory Ondrejka recently "left" the company — CEO Philip Rosedale manages to pull a fluff piece out of the BBC. He's previously denied he has anything to do with timing these media wet kisses, but we're skeptical. Perhaps it's his boyish charm and ability to spin numbers — or the fact that these media outlets are easily impressed by the whizzes and bangs of virtual worlds.