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Virtual Real Estate Boom Draws Real Dollars
An anonymous reader writes "According to a USAToday story, Second Life from Linden Labs is seeing a boom in virtual land trading. The article quotes a player as saying: 'My vision is to buy real estate in Second Life with one or two other investors and make it available to new players as a business', and it seems that 'Large swathes of undeveloped online property, some bearing an uncanny resemblance to a palm-studded West Coast beachfront idyll, are selling for up to $550 an acre.' Second Life uses OpenGL and Ogg-Vorbis running on a Linux grid." S!: We've previously covered Second Life on several occasions over at Slashdot Games.
Are we all really this stupid?
:)
Only our customers? Just kidding...
Seriously, I play Second Life also, and when I found out you have to trade real money for in-game items, and you have to do this frequently, and sometimes on a recurring basis, I kindof lost interest... I'm all for trading real money for in-game money, at least that's clear-cut. Just don't let me trade real money for in-game money, and then require me to use both in-game money AND real money in game.
Reminds me of Itchy and Scratchy Land...
If this thing really takes off (reading up on it now), and if it's not been done yet, the Black Sun (as in the coolest online hangout in 'Snow Crash') might be a cool idea...
According to this article $100US=$10Linden which appears to indicate that its really hard to make money in this game. KInda scary really when the fake money is worth more than the real thing.
Food not Bombs is a nice platitude but it breaks down when you notice that the Bombees are usually well fed
Are there any 'safeguards' against company insiders giving themselves land? What if a game change 'devalues' certain land (by blocking the view, for instance). I can see lots of potential for RL legal proceedings based on this.
Why waste your money on a web server?
Oh you want to present content to the rest of the people who browse the web? Sounds like you might need to pay for hosting.
If you join SL on the basic plan, you don't have to pay anything other than the $10 to activate the account. It's free after that; but then you own no land.
SL real estate is divided into a grid of servers. The land is sold so that the monthly subscriptions pays to keep the hardware going. The more land you own, the more server resources you're using, so the more you pay. You can even get your own dedicated servers, as islands off the mainland.
It's more or less like buying web hosting.
Please consider making an automatic monthly recurring donation to the EFF
There's also these two mind-boggling phenomena:
Why play a FPS game, when you can play Paintball?
Why run on a threadmill or pedal on a stationary bicycle, when you can run or bike outside?
IMO, as a species, we humans do the darnedest shiat.
Comment removed based on user account deletion
I "played" Second life for awhile. Began looking at the code for the bumper cars, wanted to make a virtual Nurburgring for cars to drive. I was simply fascinated by the fact the game loaded nothing on your drive beyond primitives. Everything was sent to you over the wire.
The graphics are obviously not on par with even EQ1, much less EQ2 - and the entire model doesn't lend itself to that.
When I went looking sometimes for where everyone was at, I found kind of an unseemly side of SL. Everyone had bondage outfits on and was hanging out at the virtual techno club, trying to pick each other up. There was some weird stuff going on the in "back rooms". Use your imagination. I ignored that side of the world, was more interested in things that were a little more accessible to kids.
Ultimately I found the tools were not as interesting as doing what I am doing now, working with web technologies to do my own game, and working on virtual tracks with tools designed for that purpose. (Google for Project Wildfire for N2003 if interested).
Anyhow, one of the immediate obstacles in doing a huge track like the Ring, is there was no way i was going to get the land I needed to do it. I asked a few people, sent a few emails. After all, they could just make the landmass bigger, right? It was all surrounded by one endless ocean. Well, I got some emails from other people saying essentially, no they couldn't do that. I guess there is some limit to the engine and how much land there is. I don't really know, I never got a response from anyone from Linden Lab.
Anyhow, when people ask me what could be done with fiber into everyone's homes anyhow, why do people need more bandwidth than they have - I show them second life. To have a fully Gibson like cyberspace means going down the development road of SL, where no "maps" exist on your hard drive.
I think it's flat out ridiculous that SL has a makeshift real estate market. Everyone was hogging the "coasts" to build gaudy beach homes - kind of like real life. And like real life, very few people had any taste - lots of cheap spiral staircases and stupid fountains on the "lawn" with tigerstripe bedspreads. Bunch of Hugh Hefners.
Oh, and one of the most popular clans were a bunch of bikers, guys with huge arms and denim vests with biker bitches on virtual hogs they rode around. Classy. Strange how the first things that popped up were sex clubs and biker gangs.
With the other games, especially EQ, the company claims you have no right to sell your virtual creations.
I've always interpreted that as a disclaimer of liability. Pretty hard to sue over the loss of something that you can't legally sell.
"We returned the General to El Salvador, or maybe Guatemala, it's difficult to tell from 10,000 feet"
Why?
There are currently over 400,000 players registered to the Everquest service. FFXI broke that number since the beginning of the year and is rapidly heading towards the half a million mark.
Upcoming games with mass market appeal like Everquest 2 and World of Warcraft could do even better than that.
A stretch of land in a game with a population that large is a giant captive audience. Any message, commercial, political, moral, or otherwise, that you want to get out can be shoved down the meme-holes of people playing these games by purchasing some land and throwing up a virtual billboard or store.
Now, second life has no where near those numbers. But if more games begin to use the model presented by 2L or There....
People right now are paying something like $250 for 10 pieces of gold in Dark Age of Camelot. Why should property be any different? Percieved value trumps everything, dude.
If you buy a web domain and put stuff on a web server attached to it, anyone with an Internet connection can see that stuff. Not so with Second Life "real estate." I also imagine that Second Life isn't as flexible as the Web is, either. Not to mention the fact that the "real estate's" value is dependent on the mostly artificial rarity of it, while with web domains, there's hardly such a thing as rarity.
Rob
a) use land fill to create new waterfront properties (e.g. Hong Kong)
b) drain swamp land (e.g. Florida)
c) level mountains to make an area buildable (various areas)
d) build in theoretically undesirable areas and make them desirable (e.g. Las Vegas)
It just requires less effort in the virtual world. And less environmental review processes.
I've been playing Second Life since shortly before the 1.2 release shipped, (last December), so I've been there for the whole land crunch/boom process. This newspaper article, like most, only scratches the surface... it vaguely describes the scenario, but gives no history and no clear understanding.
Second Life completely changed its economic system in 1.2. In the 1.1 and prior days, object creation and maintenance cost in-game money. Objects are made of 'primitives' or 'prims': spheres, rectangles, cones, toruses (torii??) and probably 1 or two more. For a long time, every object you created cost you 10 Linden Dollars to 'rez', or create. When you destroyed the object, you were refunded your money. Further, if you wanted to create permanent objects, you were taxed a maintenance fee on a daily basis, which you did not get back. Your weekly stipend was roughly $500, so it was critical to come up with goods and services to sell if you wanted to maintain any kind of large permanent structure in SL. This meant that everything was very secretive and hardly ANYTHING was for free, because giving away anything damaged your own ability to build things. Land was very cheap, often the minimum price of $1/square meter, simply because few people could afford to fill much space... only a few very successful people and groups could build really large structures. There was also a 'height tax'... an object high above the ground cost more than an object near the ground. This also discouraged large structures and tended to keep everyone low and small. (heck, at one time there was even a 'teleport tax'.... you had to pay to be teleported somewhere instead of flying. Abolished long before I got there.)
The entire economic model shifted when 1.2 came out. Suddenly, object creation was free. There was no maintenance on anything you built. Instead, you were allocated a certain number of prims to put on land...each land parcel is able to support a certain number of prims. (A starting player is allowed to buy 512m2, which will support about 115 prims: they can buy more land if they want to pay more each month.) The second really large change was that you could own as much land as you wanted, as long as you were willing to pay for it in RL $. You mostly still had to buy it with in-game currency, but you paid for the right to own extra land in real dollars. As an example, someone who wants to own 4,096m2, which is a pretty comfortable size, will have to pay around $25/mo to support it.
So, suddenly, land was very desirable, and almost instantly scarce. Apparently, Linden Labs also went back through their records, figured out every dollar of object tax that had ever been paid by residents, and refunded it. So a whole lot of Linden Dollars were injected into the system all at once. To make things worse, a whole new class of parasite arose, whose sole purpose was land speculation. They drove land prices into the stratosphere. At the same time, a new service, Gaming Open Market, was launched, which allows trading RL $ for L$. This meant that people who really wanted to own property or otherwise do something could throw a lot of real-life money at it. At about this same time, word seemed to get into the mass market about Second Life, and with the population explosion, speculation, and Gaming Open Market, prices went to really crazy levels. I believe some of the speculators, as well as a number of the early players who suddenly had large wads of virtual cash, made thousands of real dollars. In the case of the speculators, I despise them for doing this, because they provided nothing of benefit in exchange. They DETRACTED from the Second Life world, made it much harder for new people to get started, simply to line their own pockets. I think it's great when people get rich foom MAKING things, and am perfectly content with the tax refund, but I consider the speculators to be nothing more than by-the-rules thieves.
SL has grown WILDLY over the last four or five months. There continues to b
I can see this becoming even more of a draw to people for whom Everquest and the likes just don't hold any appeal. The addiction will remain the same, but the lure of a virtual world where chatting to individuals rather than fighting is the focus brings in a completely new crowd, females, younger kids and older adults. These people could care less about RPG's but there is a lot of potential for spending too much time here, especially if things like voice chat start being introduced, replacing "normal" RL interactions.
What I'm thinking would be to make it a lot like the internet.. That is, a network for networks.
;-) ).
Do it in stages. First off, we define our game. Assume it's simple for now, something similar to Second Life but smaller. A group of people running clients define their local world. You can take it down a notch and let every computer define it's own local building if you like. This would make the most sense.. if you're not connected, your building isn't there. It's just a blank spot of land. If you want to support more users or more complex buildings, update your hardware to be faster or throw more PC's at the problem. We can use a public key authentication mechanism of some type to verify who owns what land. This key mechanism will come in handy for the next bit.
Next, we step it up and make communities possible. Areas owned by a group of people, probably in the same geographic real-life area. They can all collaborate to build this space, and all their machines are in a P2P network to handle its existance. If somebody in the network starts cheating, its up to the community to throw the guy off their communal space. This could be done by several methods, but the most obvious of which would be to revoke his key to the space. See, in order to go in and change the community space, you have to have your key signed by others in that community. If we have a revocation mechanism, they can revoke that signature and suddenly he can't access that space anymore. We can go a step further and ban him from that space if we choose. For bigger spaces or something, we simply throw more computing power at the problem. Each community is sharing the load already, so more power in the community makes for more power to throw at the group spaces. Somebody will have to have power in this community to control access, but it'll likely be a small group of like minded individuals anyway, so they can work out their own leadership issues.
Next, we link these all together into a city or even into a world. Two ways to do this...
The P2P way is to let communities form larger communities, providing links between them. Essentially, two communities agree to link to each other in some way, and then users can wander from one community to another via some shared community space. Think of it like a road that both communities agree to build between themselves. No need to limit it to two per road though, the road can go anywhere you like, it can branch three ways if three communities want to deal with it. That sort of thing. The more computing power the community has, the more shared community spaces they can support, obviously. It scales up from there.. Anywhere in the world that isn't connected is an island. Anywhere that is connected is on the same continent (or if you prefer, has a road between their islands.. same thing, really.. depends on if they want to make land between them or a bridge
The other way to do it requires a central server system. Somebody hosting the world and controlling who owns what. Much like the Metaverse in Snow Crash, you have the main people who created the world and host the road around it. Those who want space on the world have to buy or otherwise obtain it, but at that point what's actually on that space is entirely controlled by the processor power you throw at that space. Each person carries their own load.
Cheating in this sort of thing is really a non-issue. Each person is hosting their own mess. If you want to screw up your mess, feel free to do so, but nobody will link to your space and you'll just be an island. Let small groups band together on their own to form community spaces and enforce whatever rules they see fit. Let communities connect to each other if they want to do so. It's all up to them at that point.
Practical matters: For a user wandering this space, he has to drop into the world somewhere by connecting to some community. This is all a matter of the protocol, really. Just standardize the protocol and let the guy hop from system to system a
- Give a man a fire and he's warm for a day, but set him on fire and he's warm for the rest of his life.
Are any sociologists and economists studying this phenomenon? I mean, here we are, applying *real* human resources, feelings, thoughts, time, and money to an A-Life. Instead of building "ants" and "bots" for a simulation, we *are* the ants and bots in this one. IMHO, this could get interesting real quick.
C|N>K
Well, I agree with you here. This whole deal with online properties being traded for real money and all is confusing and very hard to understand for me. However, I have a 12 year old cousin who plays one of these kind of games. Free subscription, but to decorate her online "rooms" she needs to send text messages to the company, which in return gives her credits with which she can "buy" crap in game. I asked her why she'd pay good money for something immaterial which isn't really hers, even after she paid for it. The answer was quite simple; "Because it's fun to play this game!"
That's how allot of people feel about this, I suppose. They don't spend money on owning something, they spend money on something fun and interesting. If you think of it this way, it's quite comparable to buying a computer/console game, a book or a DVD. Just something we do because we can be entertained with it. Of course, there are extremes and exceptions, with people spending hundreds of dollars on game items, but those people are a minority.
However, that doesn't change the fact that whenever you buy SOMETHING, it's not yours anyways. You're almost always dealing with companies whose main purpose is to make a profit, not to entertain you. The cousin I referred to before, for example, used a very weak password and someone hijacked her account and stole all her ingame stuff. I'll never say this in her face, but that's pretty much her own fault. Still, she contacted the company running that game and after a while, it got settled by the company. The person who stole all her items had all the items deleted, but they couldn't give my cousin "her" items back. So much for actually owning something online. Ah well, I try to keep an open mind about these kind of things...
Hate me!
The article linked to has a few flaws in it, unfortunately. One of which is the claim that there's a $9.95 a month fee to join SecondLife. I'm sure others will have pointed this out long before I did. There are two "tiers" of membership, the one-time lifetime registration fee of $9.95 or a monthly $9.95 price to become a premium member with a few extra services, primary of which is the ability to own up to 512 square meters of land parcel as long as you're a premium member.
There, the recently-abandoned social VR site that I found out about before SecondLife, tended to have a real problem with RL$ and VR$ exchanges. You really did have to shell out RL cash for VR buckage, and on a pretty significant range of expenses. Articles of clothing are insanely pricy "There". In contrast with There, the management at Linden Labs (SecondLife's developers) has provided a great deal of control over the economy. They permit - but don't promote - sites such as the gaming open market, and have very few different reasons to try and get real money from you. Primarily, the income for Linden Labs is created by monthly fees to own land. This makes sense, as each chunk of land is essentially a pretty significant chunk of server load. I own roughly 1/16th of the resources of an entire 2.8Ghz server machine, and pay $25 a month for the priviledge. This allows me over a thousand objects with which I can create my own buildings, art objects, whatever. That's the only money Linden Labs gets from me on an ongoing basis.
For in-world money, Linden Dollars (L$) the exchange rate in real money is completely dwarfed by what you can actually make in world by simply being an amiable individual and putting together a few fun events. I've got around L$7000 in world right now, thanks in part to my managing an in-world streaming radio station called Radio SLive which broadcasts an average of 4-5 nights per week of personalized music and banter using Live365's crummy (but legal) alternatives. Offhand, anyone knowing an alternative to L365 that allows for no-login, no-required-webpage referral licensed music streaming - sorry, no independent-only options, we need the RIAA stuff. It's what people want.) please let me know.
If I were to convert the money I've made into real dollars, I'd probably be able to pull around $30 out of SecondLife. Do I really intend to do that? Not a chance. In-world, that money really has a great amount of value. Simply by earning bonuses based on my social interaction with people (you earn positive and negative ratings based on actions, appearance, and build quality) you I made upwards of L$500 a week - enough to buy some cars with, and half-price for many aircraft, some of the most expensive non-land related expenses in the world. I wheeled, dealed, and pleaded to pay the in-world expense to buy my land from other players, and now only need to spend $25 a month to maintan the server space to hold it. It really isn't so bad - I could have almost as much fun with 512 square meters of land, if I weren't hosting occasional events and presenting an in-world frontage for the radio station. Clothing can be made for free - no fees beyond a L$10 upload fee for graphics and 9 second sound clips - and objects (primitives - prims) can be made in-world for attachment to a person's avatar at no costs. The only cost to create items in world is to do so on private land - there are a number of sandbox regions where people can create larger objects without much restriction. A great place to play with building a home before you get land to put it on. Coding in-world is free, and there are even many scripts written and released with a GPL-style license. Some even with the GPL itself.
The real-world to L$ economy is not nearly as bad as it is in other places, simply due to the fact that a great time can be had for literally peanuts. You don't need to own land to have a good time, though it can help. Land is continually being offered at low, low prices to landless peopl
My own pointless vanity vintage computing page
Heh, if I had a L$1 for every floating glowing spinning mall and casino sign I had to fly past or live next to, I could be the next big SL Land Baron.
--Chromal Brodsky
I've been checking out SecondLife for awhile, and it seems to be a lot more about toys and things then it does about social interaction.
You own land, you buy toys and houses for it for other people to look at..
SecondLife is glitchy, the controls are awkward, and the graphics are buggy. There is a noticable lag between when you move and when you actually move on the screen.
The scripting functionality is neat, but your average player doesn't want to write them or even bother with ones other people have written.
In There, it's all about social interaction. There is actually fun to play and it's fun to interact with other people. The graphics are not world class, but the character animation is superb and the items in the world are actually fun to use. The buggies drive easy, movement is easier, exploration is more fun.
The chat system in There is interesting as well. When you join a conversation (conversations are automatically created when two people talk a few lines to each other) you are automatically positioned around the group like you were really standing in a group talking.
In There, anyone can use anyone's vehicles and other items. I can find a buggy and jump in and drive. I can even hold it in my own inventory. When the owner logs in and wants it back, all he has to do is recall it. I've been loaned all sorts of cool stuff for weeks at a time.
I'm not even someone who likes to try and make friends in virtual spaces, such as MMORPGs. But in There, it's pleasantly unavoidable. Most people are really friendly and it's quite easy to hang out with people for hours and not even notice the clock ticking away.
There's game show events where you can win virtual cash, there's clubs, there's paintball wars, and buggy races. Tons of stuff to do, and it's fun to do with other people.
I'm not saying that SecondLife is terrible, but if you're into just relaxing, chatting a little, and playing a laid back game, SecondLife can't even be compared to There.
There isn't as cheap as SecondLife for a basic membership but There isn't any more expensive then your average MMORPG if you want to buy all the fun items. And like SecondLife, you don't have to buy everything, there's plenty you can do to make money in the game.
- It's not the Macs I hate. It's Digg users. -