Social Website Dysphoria

May 3, 2009 - in Homepage, SL Technology by: Gwyneth Llewelyn
5 Comments

We need something that combines blogs, forums, Twitter, Facebook, instant messaging, emails, videos, voice chat… and who knows all else… into an ultimate tool.

The company selling the Ultimate Tool™ will naturally have to be profitable: they will need to have a solid business model.

Users of the Ultimate Tool™ will also have to be able to earn money from it. Although registering for it will be free, it will have to put producers in consumers easily in touch with each other. They will have to feel that if they pay anything for using the Ultimate Tool™, they’ll get something in return — more than what they invest, in fact. They should be able to make good business using the tool. That also means making payments easy.

It will need to be something very hard to replicate in order to be successful and unique. There is just on Amazon.com, one eBay, and one Google, although there are certainly a lot of competitors. None have managed to replicate every single feature of those, and this means that those giants have managed to be, after a decade, at the top of the food chain.

On the other hand, it will have to address interoperability issues — an easy, and more important, a standard way of communicating between similar Ultimate Tools™, so that you can use your login and your data across Ultimate Tools™ easily. But the user will be able to choose which Ultimate Tool™ he belongs to (imagine a collection of Facebook clones, all inter-operating, all posting to each other’s status, all sending messages to each other — it would be your choice to pick one and use it, and it would look the same way, no matter where you’d log in from).

It will definitely need to be highly interactive. “Comment-based” social networking is asynchronous by nature, and it has its place — on blogs, on forums, on early Web 2.0 tools — but right now, as Facebook and Twitter are showing, real-time (or close-to-real-time) interaction is important!

And, well, it couldn’t be an Ultimate Tool™ if it looked just like any of the hundreds of thousands web-based social networking tools — after all, in that case, it would just be one of many and not an ultimate tool.

I propose that the look will have to be… dramatically different.

Instead of being cool widgets and jQuery’ed, flashy webpages… I might humbly suggest that it could be… 3D?

In that case…

… we already have it It’s called Second Life® and it’s available today.

So, if you’re still blogging about who will win the social networking race, Twitter or Facebook, my answer is: in 5 years, nobody will remember either of them, but we’ll be discussing the old days of the bursting of the Web 2.0 bubble happily logged in to Second Life (or an OpenSim-based grid connected to LL’s own). And sure, I’m quite prepared to be laughed at my bold claims, but then again, I’m used to be laughed at anyway.

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http://www.facebook.com/profile.php?id=573288688 Jan Isakovic

I knew you were coming to SL in the end

A few points:
* idea comes first, business model comes later in the world of tech. Google did not get venture capital based on the proposal for AdSense; it got it for Pagerank.
* After the idea/tech come the users; YT and FB got their valuation based on their userbase and growth trends. It was the userbase that Google bought, combined with a treasure trove of data on users viewing videos. If you add Adsense and Google’s video advertising to the mix, the possibilities are huge. Why hasn’t anything happened yet? I think for the same reason as..
* Facebook and profitability. I recently saw some stats – if FB would only add banners to all their pages, their ad revenue would be close to $1B per year. They do not do it because that kind of advertising is both intrusive and stupid. What they want to do is use users’ profiles and data for very smart and very targeted advertising. They didn’t manage to do it yet, but they have enough capital that they do not have to bug users with banners.

And finally, the marvel of the Second Life business model. While profitable for the company, it is in fact (in my opinion) very limited and targets a very niche demographics. EVE Online, the game equivalent of a sandbox VW, has only 250k paying subscribers while WOW has millions – and because of the same reason, it’s niche.

We’ll see if M will manage to make SL more universally attractive – but, if he manages that, there is a big chance he will alienate the current user base and the base of LL’s profitability.. A rock and a hard place indeed

- IYan Writer
http://gwynethllewelyn.net Gwyneth Llewelyn

Hi IYan Yes, indeed, I agree that it’s the usual business model: idea first, money next, lots of users next, and (probably!) a business plan last. Yuck. No wonder so much tech ventures utterly fail It’s all upside down, and this is not my humble opinion, but a rather considerate one

Then again, I guess I’m just biased towards what I’ve learned. Venture capital to test ideas — specially in a market that is completely new, thanks to an awesome idea that didn’t exist before — is a great way to innovate. But… business is business. If your model relies on “free access by users”, it’s doomed in the long term — unless you’re willing to create a foundation or similar non-profit to raise funding constantly for a technology that will make the world a better place. Things like the Wikipedia, Apache or Mozilla foundations are good examples, but there are thousands of similar ones.

Usually my argument is: if the model of growing on top of a free user base in expectation that money will come in somehow is a good one, why aren’t Microsoft or Apple doing that? Profitability — and a business model based on profitability — never hurt Microsoft or Apple

By contrast, a model based on a huge “free user base” is naturally interesting to report on the media. The media loves numbers, specially if they are “hundreds of millions”. It shows people like the technology. Well, people love everything that’s free, and that’s undeniable! But it doesn’t mean that you can survive as a company on a free product.
I’m fine in accepting that sometimes you have to cleverly “invent” a business model a posteriori — you make a good point with Google, BTW — but the trouble is, that model has to make sense. Google’s model was to get their revenue stream on an unrelated issue. Imagine that they’d started to charge for accessing their search engine — nobody would have used it, people would just continue to use Microsoft’s or Yahoo’s instead (who had revenue streams from other services allowing them to provide that service for free).

BTW, Google alleged once that they bought YT just to “buy themselves into the copyright wars about video”: in the sense that they were going to make a point (namely, that nobody will dare to sue Google for acting like a non-moderating “carrier” of video streaming — precisely the opposite stance of LL, who just love to interfere with residents’ content, thus making themselves liable for what their users are doing within SL). If that’s true or not, I have no idea. I guess that at the time, two major sharing sites — Flickr and YouTube — were available for grabs, and Yahoo already bought the first, so Google just had two alternatives: compete with Google Video (and Picasa) or simply drop the race for the social sharing tools (Blogger, for instance, was a bad choice; imagine what would have happened if they had bought Auttomatic with WordPress…). Whatever the real reason was, YouTube was not profitable, and very likely will never be — they’re still based on Google AdSense to get some revenue and on some people who pay to create longer-than-10-minute videos. I know that at some point Google might have thought they could, for example, just allow high-quality videos for their paid customers, a way to differentiate user accounts and encourage upgrading. Sadly for Google, their competitors — like blip.tv or vimeo — already had high quality videos. So did MySpace. YouTube had no choice but to offer the same, for free. No, I don’t believe that YouTube will ever be a profitable Google company. The best that Google can hope for is that they cut more and more costs as their vast server park grows and grows and the running cost per server drops further…

As for Second Life… it does have the right business model, and Linden Lab is profitable. However, like so many things in life that are unfair, that model, as you said, only works for a small niche market, and I’m not sure that even with the announced “SL Lite Viewer” for late 2009 this will change dramatically. SL is too strange, too different. Even Philip clearly states that SL is not a social networking thingy, although it has all characteristics of one. It’s something… entirely different. The more I become familiar with SL, the more I believe that it’s a technology still too radical for the world-at-large.

We will need to see the Web 2.0 dot-com bubble to collapse first in order to see SL to start really growing. And that will take at least another 5 years, as more and more social networking websites pop up with inexpensive platforms, all over the place, fiercely competing among themselves for a slice of the “market”. I put the quotation marks because for me a “market” of free users is not a market at all…
http://www.your2ndplace.com/blog/248 Ciaran Laval

Facebook will be here in five years, it just won’t be trendy anymore.

I’m not convinced Second Life will be here in five years its present form, I’m not convinced Linden Lab actually want it. Second Life technology will be here but the worlds will be managed by companies other than Linden Lab. That’s not to say I think Linden Lab will be gone, they’ll be beavering away making improvements to their technology and hosting a lot of these disparate worlds.

However predicting the future in technology is always dangerous, do you remember PowWow? There was nothing wrong with that, it was rather popular and then ICQ became the tool of choice for my friend list, that’s still going which surprises me as I don’t see people leaving their ICQ contact details around anymore.

Five years is however a long time in technology and yet some technologies cling on well beyond their sell by dates, VHS and Floppy disk drives spring to mind.

I setup a friendfeed account to try and keep track of various sites but I prefer to login to the sites themselves….well that’s not quite true as I’ve got messages in my inbox asking me why I don’t update my Livejournal or facebook but I digress. Friendfeed is of course an early attempt at your ultimate tool suggestion.

Amazon is a very interesting example because they were sneered at, had a rocky time and came out the other side smelling of roses. They’ve done very well and haven’t rested on their laurels, their marketplace is doing ok and they expanded way beyond books.
http://gwynethllewelyn.net Gwyneth Llewelyn

How true, how true! I’m not convinced either that Second Life “as it is now” will be around in five years, but — starting in late 2010 — it will be a complex mesh of several interconnected grids, with several different specialised viewers to connect to each grid…
http://cosmuve.com/ Giulio Prisco

Great article Gwyn. I also do the ping.fm trick instead of logging log on twitter facebook etc. directly.
I think the Second Life wave will restart when it will be, as you say, a complex mesh of several interconnected grids, with the option to host your own grid, and the option of packing taking the content and taking it eslewhere. Important technical advances are also in order — multiple media stream on a parcel (this will instantly turn SL into a good videoconferencing tool) and a real integrated and interactive web browser.
A 3D interface is just better than a 2D interafce when it comes to visually organizing information, and sooner or later this will be evident.

On a related topic:

I have written a review of yet another videoconferencing and telework system:

Testing EVO (Enabling Virtual Organizations)
http://transumanar.com/index.php/site/testing_evo_enabling_virtual_organizations/

At the end I make a comparision with VR worlds: “Yet it is difficult
to sell things called “virtual worlds” to corporate users, and I am
beginning to thing that the distinctive feature of VR worlds, humanoid
avatars, is actually seen as a weakness by many users (too many
unwanted associations with toon sex in Second Life etc.). Perhaps it
would be easier to sell 3D collaborative environments where users are
represented by less personal icons, like cubes with pictures and
webcam feeds.”

What do you guys think? Shouldn’t Second Life have a standard optional
simple cubic or spherical avatar like the floating sphere in Qwaq
Forums, with a picture of the user and the option to replace it with a
webcam feed once external media are implemented in full? I _know_ that
some clients in the business and educational sectors would prefer this
option. Where can I get such a unSL avatar? I think I am going
shopping for one.