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The Second Coming of Virtual Worlds
An anonymous reader writes "Things have been a bit quiet on the virtual world front recently, but according to an article in Silicon.com, things are about to change. Apparently it's only now that virtual worlds are really going to become a force to be reckoned with. 'Now experts predict the virtual world phenomenon is entering a second phase in which businesses will become shrewder about their involvement in such environments and look more carefully at the tangible benefits they can realize. Emerging technology specialist at IBM, Robert Smart, is confident virtual worlds will become more important to businesses in the coming years.'"
businesses will become shrewder about their involvement in such environments and look more carefully at the tangible benefits they can realize
Translation: Business has realized the ineffectiveness of trying to do business against giant penis attachment and furry accessories in a world inhabited by idiots.
Real translation: some guy at IBM figured out there's money to be made from those who _haven't_ realized that yet. So, in keeping with the tradition of hyping technologies to people who don't actually need them, next you'll see IBM and a few others pitching something along the lines of WebSphere Virtual World Server 7.1 as the second cumming of Christ. To CIOs whose idea of staying on top of their branch is reading lists of buzzwords, from paid-for-PR articles disguised as technology news.
See, there's this funny thing about gold rushes. Almost invariably the only ones who made money are not the miners. It's those who sold equipment and food to them.
A lot of business in the IT world lately is creating your own fake gold rush by PR, and trying to sell picks to some people who won't strike gold because there is none. And this reads like yet another bubble trying to get started. The message is, basically, "OMG, there's so much money to be made from virtual worlds, and there are all these people who'd take you more seriously and give you more money if they could walk into your 3D virtual shop dressed as a furry. But you have to be careful about what virtual world and business kit you get, you know? Get ours." Have you heard that before? Right. A million times, probably.
E.g., Web 2.0: you'd get so much money and be the only ones profitable online, if you only had forums, and tags, and wikis, and supported BitTorrent. 'Cause it's all about empowering the users, baby. Build a better community web site, and they'll just beg to give you their money. No seriously, that's what the Web 2.0 trademark was supposed to mean. Well, until it was hijacked. There wasn't enough to be sold with that idea, so it got hijacked to mean: buy our funky javascript frameworks and servers, and you'll get everyone wanting to buy stuff from you. People only take an e-commerce site seriously if it has a megabyte of javascript per page, ya know?
E.g., portals. Everything has to be done using portlets, and reinvent in Javascript badly the multiple windows and window management that your OS already had anyway. Customers will only take you seriously and give you lots of money if you buy our portlet server. And here's a few strawmen and non-sequiturs about how if it's done with any different technology, it can't possibly be the view and the information that the customer wants. (Confusing content with a presentation layer technology, basically.)
Etc.
So now the next message and bubble will be: do it with 3D virtual worlds! Buy our virtual shop kit, and this time the customers will really take you seriously! Would we lie to you? Again?
A polar bear is a cartesian bear after a coordinate transform.
Has any business, anywhere, recieved any tangible benefit from their participation in Second Life?*
I hear about all these businesses and universities spending so much money on virtual places that are lucky to get a dozen "hits" a month. Are any of these visitors buying a product, becoming more brand-loyal, or spreading the word?
*Linden Labs and Second Life developers not included.
-David
The economics of virtual worlds are driven by synthetic scarcity. Indeed, any digital product is subject to imposed scarcity as an infinite amount of copies could be created at practically no cost.
A big difference is that with virtual worlds, copy control and usage control can be enforced more rigorously to drive up prices. This is why you see people paying for virtual gifts on Facebook. $1 for the right to give a worthless icon to a friend. Here, the value of the product is not the product's uniqueness, but the product in conjunction with the limitations of use. You are buying back a freedom that was taken away from you by the implementation.
Second Life allows users to create and sellp roducts and take advantage of the imposed scarcity, but will skim profits by controlling the
conversion rate between linden dollars and USD. It looks like a real economy, but it's more like a pyramid scheme, as the profits will inevitably trickle up. It's like a casino. The house cannot lose as long as people keep coming.
I suppose the positive side of this is that if people are happy spending real money on virtual objects, then they probably have enough money.
A witty