Study says 90% of virtual worlds don't last 18 months

by Samuel Axon on May 17th 2008 7:00AM

Business models, MMO industry, News items, Virtual worlds

A study released by Gartner, a large research firm based in Connecticut, claims that 90% of all "business forays into virtual worlds" fail within 18 months.

According to the study, most businesses focus too much on expensive and unnecessary technology such as powerful physics engines, and don't pay enough attention to the demands and interests of users actual or potential. This is not surprising to us; savvy MMO developers will talk your ear off about how multi-million dollar graphics are at best a red herring and at worst a harbinger of doom.

On the other hand, the study also said that by 2012, 70% of all organizations will be using virtual worlds, and that those endeavors will more successful because businesses will have learned exactly what to expect and will plan development accordingly.

[Via Worlds in Motion]

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Tags: business, development, failure, gartner, graphics, physics, prediction, predictions, research, study, technology, virtual-worlds, worlds-in-motion

Reader Comments (3)

"On the other hand, the study also said that by 2012, 70% of all organizations will be using virtual worlds"

Only if they redefine Virtual Worlds to include email, teleconferencing and surfing the web. The sense of people creating avatars and sitting around a virtual Second Life-ish conference room, well, that sounds to me like a fancy barrier to getting actual work done in most cases.

Doing a phone conference while looking at shared Powerpoint slides would be more effective even now. And in fact, this is precisely what I imagine they are thinking of when they predict an astonishing 70% of businesses will use Virtual Worlds in four years. Do 70% of businesses even have a computer capable of running a virtual world such as Second Life for every employee?

Not to be overly pedantic but the article actually says 90% of virtual world *businesses* fail within 18 months, which is subtly different. What isn't clear is what they mean by that. Are they including any business that dabbles with VW building, or are they just including companies who build VW as their sole business?

*OR* do they mean businesses that operate inside virtual worlds, such as, I dunno, a clothing designer operating inside Second Life. The text would suggest this isn't the case, but we're reading an excerpt from a larger report, so the text could be misleading.

Most new businesses are lucky to reach a lifespan of five years. 60 months is greater than 18 but this still shouldn't be news worthy.

BTW I think your epic fail picture should be replaced with this that came out in the news recently.

http://www.telegraph.co.uk/telegraph/multimedia/archive/00671/plane_crash404_671675c.jpg