Businesses not stampeding from Second Life

Beam of light in a place lots of people wanted to see as dark :)

While we're a little slow, universities are indeed filling in where businesses are receding. Here at UC Berkeley we've been using Second Life to rebuild archaeological environments. It's a lot of fun and we can do things to the art and architecture that we wouldn't dare in real life. On Wednesday we're burning part of a Neolithic settlement down. :)

http://middlesavagery.wordpress.com/2008/12/04/burning-catalhoyuk/

With competition from Playstation Home and other such social worlds barking at the doorstep of SL they've done well to refocus on business and education this year. It'll give the new players some time to redefine the market while LL concentrates on next steps.

From most of the reports I've heart though, business and Edu entry into SL has been predominantly on an experimental basis. Very few players have come in with a long term virtual worlds strategy tied to SL - instead they've come in testing the waters with pilot projects.

I have no doubts that we'll see solid business uses emerge out of this, but if AVWW banter was anything to go by SL (and virtual worlds in general) are still seen as an emergent technology, not quite ready for the mainstream. I have no doubt some folk have cast their vertict, but my impression is the majority of the jury is still out.

I must say, Tateru, your articles are always concise and informative. I never miss reading your blog. I really like the way you clear up the media fog around Second Life in this article.

Thanks for the hard work

This article is something I've been wanting to see for a long time. Second Life is great for learning, doing and inventing; not selling, pushing and persuading. Business who want to do the former (or, better yet, already know how and are ready to find new and better ways) are making the most of it.

Bad news sells better than good. People love to read about other people in trouble, hence the tendency to focus on failure. Of course, we shouldn't be surprised that businesses fail in the Second Life environment. As I reported in "SLentrepreneur Magazine (http://www.slentre.com/second-life-business-only-10-of-real-life-businesses-succeed-in-second-life/) back in May, only 10% of businesses actually succeed, so failure is the norm! Furthermore, the death of Linden Lab continues to be predicted on a weekly basis (http://sigmundleominster.blogspot.com/2008/12/more-on-impending-doom-or-end-of-world.html) yet the company is still running.

No-one is pretending everything is rosy, nor that LL get it right all the time. However, there are certainly more Jeremiahs out there than Dr. Panglosses and doom and decay still thrills us all.

I think your argument is a correct one about SMEs and individual entrepreneurs making great strides in SL outside of the limelight. But I think you are going to need more data or anecdotal evidence to back it up to convince outsiders of this.

Any business owners in SL want to spread some knowledge about how it has benefited your company in the past year?

We have been in Second Life for almost two years and are using it for training, meetings, and social networking. We were the first CPA Association to get on Second Life and find it a great platform for training. Check us out at http://www.cpaisland.com. We are just getting started...

I have been to CPA Island that Rocky mentions. Dr. Michael Kraten, a professor from Suffolk University, has used this space for holding several of his classes and I have had the pleasure of giving his students several tours in SL. It seems to me that CPA Island has figured out how to have a space that is a useful tool for its members.

This seems like a common sense article. However, it is missing any actual metrics to back up the premise.

Let's posit that you are correct and "The primary business usage of Second Life as it stands today is collaborative usage." Such use would seem to be enough for Linden Labs to build a marginally business on for the moment. That begs the question what does this do for the overall economy of SL?

I fail to see how self contained usage by business builds brand loyalty in SL. With other virtual worlds poised to enter the virtual world market at a much lower user cost, how will LL prevent flight to other systems?

The challenge for LL is to make the entire
SL economy more relevant to business and personal users. I see no evidence of a coherent effort to provide that relevance for the future of SL. That lack is a primary reason we continue to see stories of the impending failure of SL. There is no alternative vision or narrative being provided.

Oh, it's anecdotal certainly. I said so in other words in the article itself.

A scientific study with hard and comprehensive data would certainly be superior, but we don't have one and aren't equipped to perform one -- so we're going with the data that we have, aggregate impressions and trends from the messages and feedback we get.

We usually find that those are very effective indicators, given the volume of data and experiences that we receive.

So why is there a need for "more data" to support claims of business success in Second Life? The recent departure of ONE business - Reuters - has been done to death as "proof" that Linden Lab is and Second Life is about to collapse. And ONE article by Eric Krangel, the dearly departed, has been touted as the new gospel for what is wrong with Second Life, when in fact, it's just the opinion of a single disaffected individual who has changed jobs.

Seems to me that there is only a need for "data" if the story doesn't fit the already decided outcome. The received myth is that SL is doomed and anything that supports this premise is "data" and anything else "needs to be supported."

Tateru, thank you very much for this article manifesting your *opinion*. :) Oh yes, I'm sure that the doomsayers will pick on each and every anedoctal example ("hey, I just saw one company leaving SL! Their island was still up yesterday, but it isn't there any more!") to use as "proof" of the Ultimate End of Second Life.

But it's hardly so. It might be surprising — it certainly has been for me! — to see how quickly, in about a year or so, companies got more _savvy_. They now do regular expectation management, instead of throwing money at ideas and hope the media talks about them. They also focus on things that SL is good for, instead of thinking about absurd uses for it. Sadly, a few good ideas — like customer polling of tastes in colours and shapes of products — were too prematurely experimented, and surrounded with so much hype. The ideas were great, the expectations were, however, set too high.

These days what I mostly see is companies picking at two major uses besides the ones you've already described (ie. collaboration, training, meetings, seminars, e-learning, etc.). One is definitely community generation. I guess some have started to read the right books — or they already have experience in managing their user community, and find that SL is the place to push them into.. The other is simulating product evaluation — with lots of metrics thrown in to see what people find interesting or not — but due to the failures in the past in that area, they are very careful in what they show.

Brand awareness is still in the minds of the companies coming to SL, of course. But you're seeing more things like Orange Island — focus on a certain type of successful resident-managed event and just sponsor it to raise awareness to _your_ brand. This means things like real life football (soccer for you Americans) clubs sponsoring the intriguing SL Football league. Or poetry circles sponsored by associations of fans of a certain author. Or fans of a certain car brand coming together in SL to join parties — and discuss the new launches of future cars with some of the designers. All these are "silently ignored" by the media. And they're plenty around.

Another change is the end of the "Multimillion Second Life Project". Impressively, companies were *very quick* to understand the harsh lessons of the dot-com bubble. It's worthless to spend millions in something you don't know how to get a return back. Instead, spend thousands, or, at least, dozens of thousands. Crude content is cheap. Investing in the community pays off all the time. Creating your own team to engage with your community in SL is even better. All things that were proclaimed as the "secret to success in SL" back in 2006/7 (and which companies have neglected) are suddenly quite high on companies' priorities. Media splash is *not*.

I won't underline the role of universities in SL these days. As reported, there are simply too many; and too many projects, too many students, too many researchers, too many conferences. In some cases, presenting something which has "Second Life" in it becomes almost a *banality*. You almost *expect* it in the course of a lecture. Even more interesting, universities are now focusing less on "how cool this brand new technology is", but much more on "how I've used this technology to do my cool project".

But not all universities have grasped SL and understood its potential. Ironically, one of my old teachers told me how he thought I was "wasting my time" by investing in virtual worlds; that a week after my application for a mastership (done remotely via SL, of course, and it's obviously one about SL) has been approved. So there are still quite some "old-timers" not understanding what is so cool about SL; others, no matter their age or their background, have suddenly be given the ultimate tool to break all barriers of distance, and focus on what they're good: producing *content*, which is, ultimately, what a university is supposed to be doing. SL is just one of many platforms that allows this content to be accessible in another form, distributed world-wide, and places no physical constraints on the recipients of the content — no matter where they are.

No wonder they've embraced SL so quickly and thoroughly.