Snowcrashing Into The Diamond Age 2 (Part Two): An Essay By Extropia DaSilva

Extropia DaSilva photographed by Shoshana EpsilonIt’s time to give voice to Extropia DaSilva again — and she’s back with an earlier topic, which she has expanded quite neatly on this latest essay of hers. Enjoy! — Gwyn


The ability to replicate the means of production themselves from cheaply available elements is what underlies most of the utopian expectations of a society with molecular nanotechnology. One commentator on an online forum asked ‘why the hell would anyone pay for something nano makes with no effort?’. Second Life, though, suggests such an argument holds no water. After all, this is a world whose content is built from resources instantly available wherever you happen to be at negligible cost, and which can be duplicated with no effort. But most reporting on Second Life does not describe a world where products are given away free. Instead, it’s all about the money. ‘Non-existant’ objects being bought and sold for real cash, land barons earning fortunes from virtual property. Also, Gwyneth Llewelyn wrote about the socio-political beliefs that SL residents subscribe to (‘Anarcho-syndicalists’, ‘Anarcho-capitalists’, ‘libertarian/neoliberalists’). Of these groups, only the first ‘idealise a SL where money, land and prim limits are unnecessary’. I don’t know how many residents consider themselves to be anarcho-syndicalists, but common sense dictates that the group believing money is unnecessary are in a minority compared to the many groups who consider it necessary, for the simple reason that the latter are many and the former is one.

Still, it is by no means uncommon to see a reporter expressing surprise that SL has virtual goods trading hands for real money. But the fact that SL’s content has monetary value is not all that suprising when one considers the entire system that supports the likes of Aimee Weber or Fallingwater Celladore. The ability to produce copies of virtual goods does happen automatically with little human intervention, but it’s only automated at one point in the manufacturing process. The design of the goods requires a concentration of effort, promoting the company and its products requires ongoing work. All of this necessitates the coordination of many tasks, and this activity amounts to a dynamic economy which is an essential element in building an online world compelling enough to sustain the interests of millions for indefinite periods.

Lyle Burkead insisted that it would also be a necessary condition for delivering the fabled machine that produces anything you wish for (provided it is physically possible). We already have many goods that are put together via molecular manufacturing. All foodstuff and timber fall into this category. So, how come oranges are not given away for free? Because, ‘they need fertilizing, watering, protection from insects. Oranges must be picked, put in boxes,  shipped to store… The store has human employees, the fertilizer company has human employees and so on. The orange tree doesn’t exist in some separate space by itself, it’s part of the economy’.

This holds true for any material good. Each and every item that ends up in the shops is an end result of a great many tasks that need to be done in order to get that product into our homes. A machine capable of producing anything you want would need to be a self-contained system that can make anything the world economy makes. To do that it would have to pack in the entire logic and process structures that collectively make up the expert knowledge of all workers and managers who currently toil away in the many corporations that make up the global economy. As Burkhead cautioned, ‘all those jobs still have to be done because if you scale the economy down to the nano-level, it’s still an economy’.

But, didn’t we discover that all that work would be necessary only in developing the first mature nanosystem? Not really, no. Once completed, it would contain the instruction set for manufacturing another nanofactory nearly identical to itself, but that is all it (and its twin) would be capable of producing. Similarly, you can expect any individual item in SL’s stores to copy  into your inventory, but that one item can only duplicate itself. True, the store that sold it represents a system capable of turning prims into many products, and is itself one business amongst many that make up Sl’s economy, which is capable of turning prims into almost anything you want. But the many, many people who run that economy are seemingly unwilling to work for free.  Why should their attitude change if, instead of building prims into useful product, they are instructing molecular mills and manipulators to organise molecules and nanoblocks into useful product?

Then again, participation in SL requires Internet access and a supply of electricity. It requires constant maintainance of the servers that run the SL grid. Even the most dedicated immersionist hell-bent on projecting their mind into a digital personae cannot ignore an empty stomach for too long, and larders don’t get stocked unless you pay money for food, or for whatever is needed to produce it. In short, all SL residents have RL bills to pay. This places an irreducible cost on every build. If our creative community came to the collective decision that they no longer needed to earn money, you’d better pray that the companies supplying their Internet access, electricity and food adopt the same attitude, or else supplying SL with content would become impossible before long.

Admittedly, one could argue that the SL community could engage in money-making work in RL, while in SL they could be entirely altruistic. But economics is ‘the allocation of scarce goods’. If you’ve ever seen residents materialise prims out of thin air, they can seem to be an abundant resource. In reality, they are one factor in a system otherwise constrained by scarcity, because the hardware storing and processing their bits is of finite capacity, and the bandwidth streaming that data to users’ PCs imposes more bottlenecks. So long as constraints remain, irreducible costs will be unavoidable, and any new manufacturing process would emerge in the same capitalist economy that SL is part of. Should we expect irreducible costs with advanced molecular nanosystems?

It seems more than likely that this will be the case. In all likelihood, the process of building functional products out of chemical feedstock would not contained in a single system, but instead would be separated into nanofactories consisting of mills that build nanoblocks out of molecules, and other nanofactories that use manipulators that assemble those nanoblocks into macro scale products. This scheme makes sense for several reasons. Probably the major one is that it would provide a way of avoiding runaway self-replication, because the mills would only be able to turn molecules into nanoblocks (but could not manufacture complex machinery)  and the manipulators would be capable of building complex machinery but could not manufacture nanoblocks.

Drexler reasoned that micron-scale building blocks would be small enough to make almost any macroscopic shape in ordinary use today within better tolerances than those provided by conventional machining. It would also allow construction of almost as wide a range of products as atom-precise nanosystems. Tom Craver suggested that ‘products that cannot be made out of nanoblocks and require atom-precise assembly could be built by dedicated-function nanofactories, with the design built in at the lowest level without destroying the factory’.

Another advantage is energy consumption. Building products out of nanoblocks requires far less energy than atom-precise molecular manufacturing. Most of the energy consumed and heat released would ocurr during the fabrication of the nanoblocks themselves,  rather than assembling those blocks into macro scale products. Assuming the blocks were re-usable, the energy used in manufacturing them would not be wasted.

Should we expect re-usable nanoblocks? Craver reckons that a profitable business could be made if manufacturing systems could copy themselves but the nanoblocks used in constructing most everyday items were not reusable. If the manufacturing systems were self-copyable but the nanoblocks were not re-usable, that would quickly build up a huge market for nanoblocks. However, Craver also commented that this approach has several drawbacks. If the nanoblocks could not be re-used, there would almost certainly be a massive increase in waste. People would be quickly compiling macro scale objects and, once tired of that product for whatever reason, could only dispose of it via the less-than-ideal methods used today. On the other hand, any product built from re-usable nanoblocks could be broken down, its building blocks fed back into the compiler, ready to be assembled into another product. Craver concluded, ‘given the value of recylable nanoblocks for energy, cost-savings and convenient disposal, and the security risks of self-copying fabber components, it seems wisest to allow recyclable blocks but prohibit fabbers that can self-copy’.

No doubt, the well-publicized dangers of gray goo will make for a powerful reason to deny widespread access to self-copying nanosystems, particularly if block assemblers are quite capable of compiling almost anything a household requires anyway. But, from a commercial point of view, the more compelling reason for suppressing self-copying capabilities is because that would nullify the R+D funding and manufacturing business model. Exponential assembly must be researched and developed, as it is the only way to build trillions of machine parts in a reasonable timeframe. But, it seems doubtful that fully-replicating nanosystems will make it into general use. This would limit the scenario in which economies as we know them end, because productive economic activity would be required in order to afford replacement nanoblocks, should a person’s current stock be tied up in product too useful or treasured to be worth disassembling.


All of which makes the promise of material wealth reduced to zero by molecular nanotechnology sound as hollow as Alvin Weinberg’s claim that nuclear energy would lead to power ‘too cheap to meter’. Actually, he never claimed any such thing. Instead, he performed various calculations that apparently showed the power cost ‘might have been’ as low as one half the cost of the cheapest coal-fired plant. He never actually claimed that nuclear energy would be too cheap to meter, yet somehow that catchphrase lives on in the public conscience.  Drexler shares something in common with Weinberg. His idea of molecular manufacturing has captured the imagination as the system that reduces manufacturing costs to zero, and yet one person who never claimed this would be the case is Eric Drexler. Rather, he argued that ‘there will always be limiting costs, because resources- whether energy, matter, or design skill- always have some alternative use. Costs will not fall to zero, but it seems they could fall very low indeed’.

His reasoning for a dramatic lowering in cost is as follows. The cost of conventional machines is strongly dependent on the number of parts they contain, since more intricate systems require more parts and manufacturing operations. But the reliability and manufacturing cost of nanomachines is pretty much independent of the number of parts they contain. As Drexler noted, ‘the number of assembly operations is roughly proportional to the number of atoms in the product, and hence roughly proportional to mass… costs will be insensitive to the number of separate mechanical parts’. In fact, an analysis of molecular manufacturing shows that the basic cost of production will be almost wholly determined by the cost of the chemical feedstocks.

But Rob Frietas made the point that there is a difference between ‘cost’ and ‘price’, saying ‘in a capitalist economy, prices of goods are set by competitive markets’. We have seen that, in SL, the economy that is required to build and maintain a compelling online world imposes intangible costs on the price of inworld goods. Given that nanosystems will also emerge within the economy, they too will be subject to various intangible costs. Frietas argued, ‘even if the cost of material and energy inputs fell to zero, say through the use of recyclable nanoblocks, there would still be an amortized capital cost plus a fixed intangible cost built into all products manufactured by the personal nanofactory… adding in the amortized initial capital outlay… plus intangible costs, manufacturing cost for consumer products should be $1/Kg’. That certainly is cheaper than today’s manufacturing costs, which currently fall between $10/kg and $10,000/kg.

Molecular manufacturing will not lower the price of everything. Any rare element, like gold or platinum, would retain its value because nanotechnology cannot make stuff like that. It requires nuclear physics, not chemistry. Also, given that the manufacturing cost for houses is already $1/kg, it seems doubtful that we will all be instructing our nanosystems to build full-scale replicas of our SL mansions and castles.


The main expectation of an economy based on nanosystems is for the cost of material goods to fall to a negligible level, and for information to become close to 100% the value of any product. In SL, particularly gifted designers charge thousands of Linden dollars for goods that cost next to nothing to produce. The raw materials may have no value, but their design expertise certainly does.  It could well be the case that, even if a product costs $1/kg to manufacture, designers could charge much more than that for the all-important blueprints driving the assembly process. During a discussion I held on the societal impact of nanotechnology, Leia Chase argued, ‘it will make the mass-produced nearly free, make services more expensive than goods, and make custom-designed items the commodity to those who think of themselves as wealthy’. All of which would sound entirely familiar to a resident of SL, because that is exactly how things work in this online world.

We saw earlier that the optimistic outlook for a society based on molecular nanotechnology stems from the massive drop in manufacturing costs it would enable. The dystopian scenarios are, in one way or another, attributable to the fact that nanosystems must be provided with a set of instructions to guide the assembly process.  In this part of the essay, I shall be using the points raised in an article called ‘Nanosocialism’, written by David M. Berube, who is a Professor of Communication at the University of South Carolina. The paper pretty much covers every negative possibility regarding the social impact of nanotechnology (those that fall within scope of this essay, to be precise).

Berube’s first agument is that nanotechnology is a threat to current corporate profitability. This is maximized by reducing production and supply substitution from competitors, which together keep supply down and demand high. At the same time, that demand is magnified by designing in obsolescence (which has the effect of sustaining levels of consumption) and by persuading customers that they need (rather than want) the product.

Berube argues that obsolescence, the aftermarket and substitution are critical to corporate profitability, and that molecular nanotechnology is a threat to the established order. How so? Because handling matter with digital control would make a product ‘the final purchase within a product line that the customer needs’. It is digital because atoms in strong material are either bonded or they are not bonded. In-between possibilities do not exist. Because assemblers work by making or breaking bonds, each step in the manufacturing process either succeeds perfectly or fails completely. Unlike current manufacturing, whose parts are always made and put together with small inaccuracies, each step in molecular manufacturing is perfectly precise, so little errors cannot add up. Admittedly, thermal vibrations are likely to cause parts to come together and form bonds in the wrong place, so it is more accurate to say macro scale products will be ‘almost’ perfect, not ‘absolutely’ perfect. But, a few misplaced atoms not withstanding, products manufactured in this way would go significantly beyond the durability of today’s offerings. Eric Drexler visualized a rocket engine, built the nanotechnology way: ‘Rather than being a massive piece of wielded and bolted metal, it is a seamless thing, gemlike… its empty internal cells, patterned in arrays about a wavelength apart… producing a varied iridescence like that of a fire opal… Because assemblers have let designers pattern its structure to yield before breaking (blunting cracks and halting their spread) the engine is not only strong but tough’.

In all practical definitions of the word, wear and breakdown would be nonexistent for products assembled with atomic precision. The result, according to Berube, is that ‘replacement and aftermarkets become irrelevant’. Now, as far as I can tell, wear and breakdown of SL ‘products’ is similarly nonexistent. Clothes never fray, buildings never crumble, boots never loose their shine, jewellery never looses its lustre. True, they can mysteriously vanish from your inventory, but that annoyance aside I think it is true to say everything residents have built shall remain just like new until the end of the world. A further challenge for SL’s content providers is that ‘needs’ are very much irrelevant. The whole world is a luxury item; nobody NEEDS to log into SL in the way we need to seek shelter and nourishment. The world of SL, then, is built around completely nonessential products that are utterly impervious to wear and tear. But despite all that, every day millions of items continue to be traded, driving an economy that can either be described in triumphant tones as ‘the fastest growing economy on the planet’ or ‘still a very tiny economy relative even to towns in RL’, depending on which statistics best serve your agenda. Either way, that economy persists, which suggests that a global market based on products invulnerable to wear and tear don’t come to a dead end, after all.

So what’s going on? I think we need to consider another kind of obsolescence: ‘Design’ obsolescence. Consider, for instance, how fashion designers in SL upped the ante. Clothes progressed from being mere 3D shapes, to shapes textured with images of ‘real’ cloth, to clothes sculpted with creases and folds, to dresses that swing naturally with their wearer’s movement. Similar progress was made in all aspects of ‘builds’ in SL, and it is clearly a sign of a community pushing a learning curve, discovering what can be done (while the  limits of possibility move further out as the tools are debugged, improved, and expanded). Anshe Chung highlighted innovation as the key skill required to run a successful SL venture: ‘The nature of the VR economy is that it’s hard to maintain margin when you do something everybody does… But when you are innovative you have even more opportunity than the real world’. So, in SL the bar keeps being raised and obsolescence is very much a part of this world, as items whose design does not incorporate the latest and best techniques look tawdry in comparison.

That earlier reference to the ultra-durable rocket engine did not do justice to the full potential of molecular manufacturing, for it goes way beyond merely improving current materials. Whereas today a single function is incorporated within a volume of the product, molecular manufacturing could see items with trillions of sensors, computers, motors and electronics. This is partly due to the incredible levels of miniaturization it would open up, but also because a nanofactory imposes negligible cost for each additional feature. This is in marked contrast to conventional manufacturing, in which product complexity is limited because the number of operations are minimized in order to reduce manufacturing costs.

Nanotechnology would do much to advance us beyond the expense, bulkiness, clumsiness and unreliability of today’s motors, sensors, computers, electronics and moving parts, and the limited flexibility that stems from all that. Drexler observed that fireflies and some deep sea fish use molecular devices capable of converting stored chemical energy into light. ‘With molecular manufacturing, this conversion can be done in thin films, with control over the brightness and color of each microscopic spot’. Various other methods of fine control would give materials the ability to change shape, color, texture and so on, and this would give real world artefacts almost as much flexibility as virtual ones. As a consequence, the SL designer’s augmented ability to experiment fast and strange, get feedback, and experiment again would leak out into real world manufacturing and aftermarkets, resulting in the kind of rapid innovation required to cut it in the SL marketplace.
You can see why information and service jobs will assume a dominant role in the nanosociety. With goods able to pass from final design to mass production with ease, and with products potentially enabling degrees of customization unseen outside of virtual reality, molecular manufacturing would open up a competitive advantage in knowing customer preferences. We should expect a further move away from the traditional make-and-sell, command-and-control organization and toward the sense-and-respond, adaptive organizations that emerged as IT was integrated into businesses and real-time customer feedback became easier to gather and analyze.

The competitive edge in a society with widespread molecular manufacturing will come mostly from being able to focus on and respond to the changing moods of the customer. It’s interesting, then, that we are seeing a move away from a centralized delivery of services in SL (in the shape of welcome areas, orientation islands etc. run by the Lindens) toward a more decentralized scheme in which 3rd parties develop customized login processes, welcome areas and other such services. The reason for this move is clearly because the sheer number of people joining SL make a one-type-fits-all introduction to SL largely unfeasible. One company cannot be expected to deliver myriad help islands and other services tailor made to suit every group and subgroup that have now formed. As Gwyneth Llewelyn observed, ‘the whole login process has to clearly focus on bringing someone directly into a community that’s likely to attract the new user and make them stay’.

If anything is required to encourage a person to stay in SL, it is access to services and communities that will nuture their particular talents. Unfortunately, by handing over nearly all of the content-creation duties to residents while at the same time taking it upon themselves to provide help and support, the Lindens created a situation where diversity exploded, communities became lost in the crowd and new arrivals set foot in a world where finding your way around is a baffling task. Lem Skall commented on how it is so very different with most other community websites: ‘There’s usually some overlap, but they are either a game, or a social network, or maybe a place to do business. When joining these communities, we know what to expect and what to look for’. Now, on one hand the good thing about SL is that it’s flexible enough to be all those things at once. But, on the other hand, such flexibility must face the bottleneck of individual strength and weakness. Even if all technical constraints were removed, SL would still not really be the place where you can do ‘anything’; only a place where your limited skills are less constrained by external factors than in RL.  This brings into focus the problem of discovering the right path through a world with near infinite possibilities, most of which are ill-suited to the individual’s preferences and skills. Lem Skall again: ‘Things might have been very different if SL had started as a pure software platform that separate providers could use for separate worlds with clear purposes, and if all the worlds had been unified later… so much has been said about the strategies of corporations into SL. Maybe one of the best strategies is to act as portals. No building but an orientation island and Web interface to creating new accounts. Businesses and educational institutions are already creating their own sims… What I’m thinking is… a unification of such separate worlds into sub-worlds’.

Notice the parallels that exist between building a useful metaverse, and the anticipated skills required to run a successful business in a society based on productive nanosystems. In both cases, the ability to provide highly tailored services is paramount. It seems to me, then, that as the Lindens pass over more and more of the running of SL to the open source community — depending on 3rd party viewers, welcome areas, themed islands and so on — there will be much opportunity to perfect the kinds of personal services and product advice that would have value in a world where the consumer/producer relationship blurs in the continual choice of the individual to ‘make’ or ‘buy’.


Specialization has long been understood to be a defining feature of market economics. Individuals are producers of one thing and consumers of everything else. Some commentators expect consumers to be sole producers of finished products of all kinds once productive nanosystems go mainstream, leading to a more equal society. Others (Berube among them) see things entirely differently, believing molecular manufacturing will only lead to the caste-ing of society into those with power and those without.

How inclusive will the development of the technology itself and the manufacturing capabilities it enables be? Another way to phrase this question would be ‘will we see open source designs, or will some centralized group seek to monopolize the technology, perhaps through patents and other legal restrictions?’. Berube sees the latter as most likely, arguing that totally free access to productive nanosystems would jeapordise contemporary hierarchial structures in capitalist corporatism. “A technology paradox ocurrs when R+D by a corporation actually reduces corporate power. For example, in the present system, as products increase in supply or as the means of production devolve into the hands of consumers, prices fall”. Traditionally, the paradox is avoided by expanding the market so that it exceeds the declining prices. But, once the means of production becomes completely decentralized and placed in every home, “most avenues of market growth lead nowhere”.

As SL spread its message beyond early adopters and began to attract the attention of commercial giants, there was some uneasiness among the residents. How would those who catered for the fashions in this online world fare against high-street brands? Would these masters of marketing take control of the VR landscape, manipulating desires by spinning a web of concepts, brands, advertising and persuasion, shaping not only the surroundings but the thoughts of the populace to suit themselves? Nowadays, though, one tends not to read about the intense viral growth of corporations in SL. Quite the opposite. What you tend to read about is how familiar brand names came to SL and failed to have any impact at all, beyond a few curious visitors during the first hours of opening.

Is this failure connected with the fact that SL features a massively decentralized means of production, delivered into the hands of each and every user? It must surely be the case that the competitive advantage that corporations have over the little guy is very much reduced in SL because, relative to the real world, everything is so easily accomplished. But, I doubt that this is the only reason. What also needs to be considered is the fact that most RL brand names achieved widespread penetration through traditional media channels, and perhaps what works well there works less well in SL? The main difference between online worlds and traditional media was explained by Rosedale: “We all got TV, and it enabled us to see and learn many things, but unfortunately those things had to be centrally authored, without our participation, by a very small number of people. SL, built and managed by the residents, is a natural correction to our early, disempowering media — a better world, owned by us all”.

Perhaps because the populace has such powerful control over  the landscape, and are very much an active contributer using the same tools as any corporation hoping to spread their message in SL, it becomes significantly harder to spread brand awareness using the means of advertising familiar to the high street. As Justin Bovington (who co-founded the branding agency Rivers Run Red with his wife Louise) reasoned, ‘you can’t just dump stuff in here and expect people to take an interest… People think young consumers are apathetic. They’re not apathetic. They’re just very well defended against advertising”. In RL, billboard posters are a part of our landscape whether we wish they were or not. But, in SL, a company’s billboard campaign must contend with the fact that, on Resident-owned land, unwelcome content is deleted with a simple mouse-click.

Really, though, the main reason why high-street names tended to fail in SL can be attributed to the fact that they were remarkably unimaginative when it came to extending their brands in VR worlds.  Simply setting up a store and expecting to attract a large and persistent customer base just because its ‘popular brand name X’ is not good enough. Perhaps it is true that, in a VR world, ‘most avenues for market growth lead nowhere’, but it must also be the case that new opportunities for raising brand awareness become available. Given that active, realtime collaboration is a major part of SL’s appeal, perhaps involving the customer in the design process would be one such opportunity. Reebok went down this route. They opened up a store in SL that allowed residents to customize virtual sneakers like the ones found at Vessi Footwear according to taste, and the company planned to take the most popular design and market it in RL

Open source tends not to put a final polish on its products. Because of this, commercial interests could still make a profit if the means of manufacturing went down the open source route by repackaging and adding that final polish to products. Along with focusing on personal services, goods in a shop could be priced according to prestige of certain designers. Berube believes that the price of goods and services cannot be expected to decrease with the realization of molecular manufacturing, since the cost of R+D must be recouped. But, once nanosystems are as fully integrated as Pcs now are, nearly all capital would be dramatically reduced in value. Capital, by the way, is not ‘money’, which in and of itself has no value. What capital REALLY is, what REALLY has value, are services and the means of production. Labour, raw material, machinery and knowhow are the true lifeblood of industry. “In a world of nearly infinite resources, the value of toil and labour will disappear”, wrote Berube. “The nanotech elite will be the technocrat and the tech-intelligentsia- a small group”. As for the rest of us, Berube argued, “whatever time they have at their disposal will be spent acquiring worth of any and all sorts merely to keep step in the nanoeconomy…economically defranchised and socially declassed people could contribute to the genesis of Third World countries in the centre of our cities”. These fears were echoed by Susan (baroness) Greenfield in her book ‘Tomorrow’s People”: “In times to come…there might be the… invidious distinction of the technological master class versus the — in employment terms — truly useless”.

Remember that quote from Sl’s founder, ‘a better place, owned by us all’? Lovely sentiment and all that, but it really isn’t true. Gwyn explained why. “You can see a huge gap between the resident’s classes… while perhaps 5% of all residents are active participants in the economy (who) contribute to the overall content, the remaining 95% are completely out of the loop”. In fact, so imbalanced is the flow of currency in SL that it has been compared by some to a traditional pyramid scheme in which only a few harvest money from a large mass of players. It would be wrong to suggest that SL was deliberately conceived as a pyramid scheme. But, by granting everybody the right to buy and sell services and virtual goods to one another in a free market, it was perhaps inevitable that wealth would accumulate around the gifted few who can produce masterpieces of whatever they make.

This does sound uncannily like Berube’s dystopian vision of a technological master class reaping all the rewards of molecular nanotechnology. What’s more, other observers have seen a parallel between the activities of SL’s residents and Berube’s expectation that the masses will be frantically acquiring worth of any and all sorts. In answering that evergreen question, ‘what are you meant to do in SL’, ‘Play Money’ authour Julian Dibell answered, ‘SL is about getting the better clothes etc. The basic activity is still the keeping up with the Jones’s, the rat race game’.

If ‘what am I meant to do?’ is the first question a SL resident asks, the next is likely to be ‘how do I do it?’. If a fundamental aspect of SL is the buying and selling of goods, then the second question is more precisely defined as ‘how do I get a foothold on the economic ladder?’. In other words, how do you start acquiring the finances required to earn the capital needed to be a player in your chosen business? There is a quick and easy way to get reasonably large amounts of SL currency, which is to purchase them directly. As with all currency, the value of the Linden dollar against the US dollar continually changes, but on average you can expect to get between L$260 and L$320 for every US dollar spent.

However, a New York Times’ article noted that ‘although L$ can be bought with a credit card, there’s evidence that the in-world economy is self-sustaining, with many players compelled to earn a living in-world and live on a budget’. You might think everybody would settle for nothing less than the kind of career seen as aspirational in RL — property tycoon, pop star, architect — that sort of thing. But, actually, SL residents are willing to take on jobs as sales clerks, nightclub bouncers,  hostesses, for wages ranging from L$50 to L$150 per hour. In a world where owning that ultimate symbol of material wealth, your own private island, is within the budget of most people who can afford a high-end laptop, people sidestep the easy way to big Linden bucks and instead work for them, in jobs that pay a pittence in real money.

It’s probably not the case that anybody comes to SL in order to fullfill a lifelong ambition to work as a shop assistant. Rather, they accept that engaging in the lowest level of work in SL is often the necessary first step an entrepreneur must take. But the fact that such roles are performed at all in what is a fantasy world brings into question the assumption, often expressed, that nobody will be willing to do work of this kind once molecular manufacturing enters the market.  But while they may be willing to do such work, the opportunity to do so will only occurr if such work is available. There are two great promises and perils commonly associated with molecular manufacturing. The first is the promise that exponential assembly will compile an abundance of goods (with the peril of runaway assembly leading to gray goo), and the second is the promise that nanosystems will dramatically lower the cost of capital (with the peril that labour will be totally devalued).

Is the latter peril really a bad thing? Such a declaration would appear to stand in contrast to the dream of a life free from toil. This vision can be traced back at least 23 centuries, to a time when Aristotle wrote, in ‘The Politics’, ‘we can imagine managers not needing subordinates and masters not needing slaves… if every machine could work by itself… by intelligent anticipation’. And here it is again, this time from a quote in ‘Time’ magazine, 1966: ‘By 2000, the machines will be producing so much that everyone in the US will, in effect, be independently wealthy. How to use leisure meaningfully will be a major problem’.

Ah, there’s the rub. It is generally taken as axiomatic that loosing jobs must mean the loss of meaningful activity. And if you examine that Aristotle quote closely you will notice an imbalanced benefit. It is the MANAGERS who no longer need (human) subordinates, the MASTERS who no longer need (human) slaves. It’s an imagined world in which the elite exchange human labour for machines, flexible enough in limb and just flexible enough in mind to be trusted to perform its role in the workforce (but, presumably, not to question its lot in life). But Aristotle makes no suggestion that the displaced subordinate class has been lifted to the status of ‘master’ (in fact, the passage is actually his pragmatic defense of slavery in his own time). We like to think slavery has been abolished now, but the other assumed axiom is that the loss of your job must mean the loss of your income. How would the labouring classes raise the funds needed to become a factory-owning capitalist, if his or her skills have lost all monetary value?

Then again, isn’t the promise of molecular manufacturing that nobody NEEDS to work? If it lowers the cost of capital and profoundly raises the abundance of goods and puts the means of production in everyone’s home, then (as SL resident Ralph Radius asked) ‘why wouldn’t a world of nano be divided into purposeful people and those who hang out? Living will be virtually free’. What might be wrong with this picture is that it assumes a lowering of the COST of manufacturing means a reduction in the PRICE of goods and services. As we have seen, Berube anticipates that this will not be the case (at least initially) because nanoproduced goods and related services will carry the R+D surtax of molecular nanotechnology. As for the hypothetical ability to bring forth an abundance of products (and the implication that they will be given away to anyone who asks for it), perhaps artificial constraints like IP rights will limit this scenario, as is the case with hypothetically copyable product in SL. Some of the products made possible by molecular manufacturing could create huge incentives for profit taking. Nano-manufactured computer components, by today’s standards, would be worth billions of dollars per gram. And something like food has large and intricate molecules providing its taste and smell, minerals for nourishment that would require much research in order to handle them in a nanofactory setting, and it contains a lot of water, which is a molecule that tends to gum up the components of the nanosystem. I’m not saying that compiling food is impossible, only that compiling food from chemical feedstock would be a very stiff challenge. Will this basic requirement of life be distributed for free, or will there be a heavy R+D price imposed on it, as is the case with lifesaving medicine?


Having decided everything will not be ‘free’ once nanosystems become widely available, we seem to have leapped to the opposite extreme, that their products and services need to be very expensive. We also seem to be assuming that molecular manufacturing must exclude the majority of the populace from gainful productivity. What underlies such assumptions? Most likely, it is ‘complexity’. Productive nanosystems would be the most sophisticated products ever built. There is no precedent for a process that combines 10^25 parts to form a single object in manufacturing today. Some assume that using such immensely complicated machines must require a great deal of skill. ‘Yeah, all those unemployed steelworkers can be retrained as molecular biologists’ was one sarcastic reply to the suggestion that the age of molecular nanotechnology need not mean the end of gainful employment. But is this a safe assumption to make? Possibly not. After all, do you need to be a mechanic in order to use a car? There was a time when this was indeed necessary. Lifting up the hood, tweaking and fiddling around with the engine was not an indulgance for the hobbyist or an occasional annoyance for the stranded motorist, it was a regular part of car ownership. One can well imagine early car drivers fearing that if automobiles became more complex all but the very best mechanics would be excluded from motoring. Cars did indeed increase their complexity, but they also became more reliable; easier to operate.

Another, perhaps better, example is computers. The first operational computers were built by a ten-thousand strong team of elite thinkers, lead by Alan Turing. They were a top-secret military tool; 2,400 valves all put to the  chief purpose of decoding Nazi transmissions that had been scrambled using a cipher machine known as ‘Enigma’. It not only required rare skills to construct these mechanized wonders, but also to operate them.  A later computer (ENIAC) typically required eight hours of repair for every eight hours of use. Who would have believed that, one day, computers with hundreds of millions of parts, able to outperform those early examples by eight orders of magnitude, would be a standard feature in people’s homes?

The fear that technology will become too complex for all but those highly skilled in some niche discipline is a recurring theme. Another fear is that skills will be lost because of technology. Such concerns did not begin in the 90s with the arrival of competent spell-checking software and the worry that a strong knowledge of grammar would be lost. Nor did they arise in the 70s, with affordable pocket calculators and the fear that fundamental skills in maths would be eroded. They didn’t begin in the 20th century at all, or even the millennium. As far back as 470 BC, Socrates feared that the development of the alphabet (which had been in use for over 100 years) would ‘create forgetfulness in learner’s souls… they will trust to external written characters and not remember of themselves’.

You would be hard-pressed to find anyone who regarded literacy as a skill that enfeebled the mind today, although you may well hear such voices of concern regarding the tools built into word-processing software or learning aids freely available on the Web. And yet, in both cases there is a common theme. Technology does not just cause the loss of skills, it ENABLES the loss of skills. That last point is expressed by the term ‘encapsulation’, which refers to technology that has become hidden in everyday society, despite being in widespread use. It can be hidden in a literal sense. Personal computers began as home-built construction kits, assembled by keen enthusiasts who obviously became familiar with its innards. These days we buy laptops and risk loosing our warranty if we open them up. But mostly the technology becomes hidden because it does its job with minimal fuss.  The TV simply starts transmitting sound and visuals. We no longer need to fiddle with manual controls for horizontal and vertical synch, because you get a stable image at the press of the power button.  The telephone simply connects your call. Remember how there was a drive to teach everybody binary, in anticipation of the ‘computer age’ when we would all need to know how to write assembly language, but now packaged software enables anybody to get PCs to perform useful tasks, not just programmers? Well, in 1910 the rate of growth in the telephone industry prompted a Bell Telephone statistician to project that every working-age American woman would be needed as a switchboard operator. In his book ‘Future Hype, Bob Seidensticker reasoned that, according to the definitions of 1910, every single person who uses communication technology to make a call or surf  the Web is (thanks to automatic switching technology) connecting calls and doing the job of the switchboard operator. In 1911, the philosopher Alfred North made the following observation: “Civilization advances by extending the number of important operations which we can perform without thinking about them”.

Let’s stick with computers a while longer. Earlier, I asked, ‘how do your write… a million billion lines of code when such an endeavour is out of the question?’ but left this unanswered. A similar dilemma was encountered in computer chip design. At first, draughtsmen designed computer circuitry by hand, but as the parts counts soared into the tens of thousands and beyond it became impossible to design and layout such chips by hand. Fortunately, ready-made computers were there to open up the bottleneck, and today engineers have access to many powerful CAD tools. Some just enable the computer screen to serve as a traditional drawing board, but at the other end of the scale there are so-called ‘silicon-compilers’. These software systems can produce a detailed design of a chip — ready to manufacture — with very little human help beyond specifying the chip’s function.

It becomes advantageous to develop compilers only when resources are cheap and abundant. If they are costly and scarce, this puts an economic pressure on developing systems that are small and simple, which requires step-by-step human planning. Before the 1960s, processors were orders of magnitude slower and memory was orders of magnitude more expensive than today. This economic environment favoured assembly language and its ability to provide instruction-by-instruction control. But after the 1960s, the number of components rose by a factor of a million, while the manufacturing cost per transister had fallen to mere pennies. Drexler explained, ‘if a 10^6 transistor design has an expected market of 10^5 units, then every dollar of design cost per transistor adds tens of dollars to the price of each chip, yet a dollar can’t buy much time from a human design team… silicon compilers emerged… gained a foothold, then steadily improved, becoming an integral part of the design process’.

Current macroscopic hardware designs are comprised of relatively few parts and production costs can be expensive. So, naturally, there has been no incentive to develop compilers to help us plan the design of macrostructures. They would not compete with the quality and cost-effectiveness of detailed human design. But, as we have seen, the parts-count of products manufactured via nanosystems (including nanosystem parts) will grow into the trillions and beyond, and production costs will dramatically fall. This would make compilers attractive, even if  each compiler-specified system were to waste twice as much space, mass and energy as would a system designed by detailed human knowledge. Therefore, even inefficient compilers would be attractive, and once they gained a foothold in macroscopic design space, we should expect compiler tech to improve, just as it did in computer chip design.

It’s worth emphasising that compilers do not completely remove humans from the design process. Drexler: ‘Human design will remain dominant at the level of parts and subsystems (in the form of knowledge built into the compiler) and at the level of overall system organization and purpose (in the form of specifications given to the compiler when it is used). The intermediate levels will be designed, with considerable inefficiency, using algorithms and heuristics that represent a workable subset of human knowledge of design principles’.

So, computers both encouraged and aided the development of design tools that can assist people in planning the manufacture of systems too complex for humans. They also enabled a radical shift in employment patterns, and really molecular manufacturing should be seen as an evolution of the working practices enabled by IT technologies, rather than a revolutionary dislocation from current jobs. This becomes even more apparent when you consider that a far greater revolution in working practices occurred in our past. When Berube talks about the cost of labour devaluing in the face of molecular manufacturing, it’s hard to shake the conviction that he equates ‘labour’ with physical effort, wages earned by the sweat of the brow and all that. 150 years ago, 69% of Americans were engaged in just that sort of work, because they worked in agriculture. Today, the number of Americans working in agriculture is just 3%.  As for the rest, 28% work in industrial production and 69% work in the service or information industries. “Increasingly”, an article in ‘Forbes’ magazine noted, “People are no longer labourers; they’re educated professionals who carry their most important work tools in their heads…modern occupations  generally give their practitioners more independence — and greater mobility — than did those of yesteryear’.

It is expected that, as productive nanosystems become integrated into society, work will shift towards 100% service and information. This is obviously the state of employment in SL today. Whatever work you are involved in, you can guarantee it either involves finding, evaluating, analysing and creating information (in which case you work in ‘information’) or it involves ways of helping other people (in which case you work in ‘service’). It is obvious that programmers work in ‘information’, but so do lawyers and engineers and librarians and teachers and magazine columnists.  One thing that SL has shown is that, at some point, people do not crave standard goods at ever-decreasing prices, but customized goods tailored to meet individual tastes or needs.  The opportunities that exist for gainful employment in SL centre almost entirely on ‘providing creativity and originality, customizing things for other people, managing complexity, helping people with problems, providing old services in new contexts, teaching, entertaining, and making decisions‘.  I was not quoting a SL analyst, by the way. That list came from a passage written by Eric Drexler, regarding the kind of work that will be valuable in the nanosociety. That SL should favour the sort of work that will retain its value once productive nanosystems become widely available is not all that surprising, since it realises most of the perceived advantages of molecular manufacturing over top-down subtractive manufacturing.


People have occasionally wondered what kind of economic system is at work in SL. Rest assured that this is much more than idle ivory tower speculation, because defining SL’s economy would enable us to anticipate what economic model would develop under the widespread adoption of productive nanosystems.

One possibility is that SL’s economy is the same as the one we have in RL. This is the viewpoint that the ‘NY Times’ article I mentioned earlier subscribed to. According to the article, SL is a world of ‘mortgage payments, risky investments, land barons, evictions, designer rip-offs, scams and squatters’. Where there are shops everywhere ‘so it’s easy to say “oh, OK I guess I’ll have a better pair of jeans” ’. Lured in by tales of ‘residents (who) lived the American dream in SL and built up L$ fortunes through entrepreneurship’, newbies enter a world ‘where we trade our consumerist-orientated culture for one that’s even worse’.

Others, though, have questioned this assumption that the SL economy is simply the same as the one we find in the consumer-orientated parts of RL. One critic argued, ‘what Linden Labs has tried to do is replicate the atom-world scarcity rules in a bit-world environment’. In other words, SL really was intended to be the sort of scarcity-based economy we find in RL, but its fundamental reality is binary digits and ‘it is the nature of bits to be easily copied’. Thus, Linden Lab’s attempt to impose artificial scarcity in an online world was bound to fail sooner or later (as if you didn’t guess, this argument was a response to the CopyBot incident).

However, Wagner James (Hamlet) Au identified a flaw in this argument. ‘I think it’s highly debatable whether SL is a scarcity-based economy. I think it makes more sense to think of SL as a brand or even a personality economy in which there’s a high premium in owning content from the most admired creators’.

There was a time when any press release would feature an interview with at least one of those ‘admired creators’ Au referred to. There were two good reasons for this. First, the quality of their work rightfully brought them recognition. But, secondly, it was the simplest way to highlight the fundamental difference between SL and the MMORPGs with which it shares a nominal similarity. A typical MMORPG comes with draconian licensing agreements that explicitly forbid the end user from claiming ownership over the money and objects they quest for. Attempts to sell your wares over eBay and other such sites meets with instantaneous deletion of accounts and removal from the game (not that such measures have prevented the emergence and growth of a market in VR goods. In fact, it is rumoured to value $20 million in the US alone and an order of magnitude higher in Asia).

Of course, SL has quite the opposite attitude, in that the objects you create inworld ARE your intellectual property; you DO own the rights. As Cory Ondrejka explained, ‘historically, what you need to drive innovation is markets, and markets derive from ownership’. So, an interview with one of the revered builders of SL was the most efficient way to get across the message ‘no, this is not an MMORPG’, and if you wanted your reader to understand that SL was serious business, what better way to do that than to refer to the serious money some residents were making for themselves?

But, while it’s undeniable that you can, in principle, earn a good living entirely on in-world entrepreneurship, perhaps those articles were misleading. This was especially true if the implication was that you WOULD make a good living (or any profit at all). Just as Dick Whittington found that the streets of London were not paved with gold after all, newcomers to SL discover this is no quick and easy passage to fame and fortune.

The economics page on SL’s official website provides statistics such as ‘monthly spending by amount’ and ‘unique users with positive monthly $L flow’ (PMLF). Looking at the latter and assuming a PMLF of between $10-$500 makes you ‘poor’ while $500-$5,000+ makes you ‘rich’, one can see that, in December 2007, a whopping 48,904 out of 50,678 users with PMLF were ‘poor’. Much the same conclusion arises if we look at the statistics for ‘monthly spending by amount’. According to this chart, out of a total of 341,791 customers spending money inworld (again, during December 07), 269, 926 spent between $L 1 and $L 10,000, and 71, 865 spent between $L 10,000 and $L 1 million. If we assume the strength of the L$ against the US$ was at its highest, that translates to 269,000 spending between a fraction of a dollar and $30, while 71,865 spent between $156 and $3125+.

What does this tell us? These days, Googling ‘SL economics’ reveals that the most popular interpretation is that, since the vast majority of residents are not making fortunes (or anything like a profit at all), those old stories of SL as a land of opportunity were overblown hype. Gwyneth Llewelyn recently wrote that a favourite theme amongst journalists is ‘to report how SL’s buzz and hype is dying’ leading inevitably to ‘the downfall of SL’. Google corroborates her opinion, because the most popular ‘hits’ are all articles explaining ‘the phoney economics of SL’, ‘VR world’s supposed economy is a pyramid scheme’ and other such analyses that can hardly be described as flattering.

That ‘NY Times’ article I referred to was therefore one of a great many articles that paint a negative picture of this online world. “What does SL say about us, that we trade a consumerist-orientated culture for one that’s even worse?”. What if this question truly reflects the nature of SL? Does that imply that our future nanotech societies will be dystopian nightmares of rampant consumerism favouring a tiny elite?

Not according to Au, who countered Nick Yee’s question quoted above by pointing out that ‘the latest economic figures simply don’t back up the premise of Yee’s question. In August… 91% were spending less than L$ 10,000 (USD 18.50). Only when you get to that remaining 9% do you see any significant spending in terms of real dollars… There’s surely a lot of inworld goods and services that exist inworld, and much of it is trading hands. But what seems more plausible is that the bulk of those transactions are conducted in a barter or gift economy between friends and communities and, just as often, total strangers, sharing and trading what they own. This almost strikes me as a reversal of consumerism as it is commonly understood, for it undermines the economic motives for doing so’.

Perhaps describing this exchanging of gifts etc as being engaged in ‘economic‘ activity is just wrong. This naturally raises the question, ‘OK, but if SL is not an ‘economy’ what is it?’. I think Au has partly arrived at the answer by acknowledging that ’the bulk of those transactions’ are friends and communities and strangers ’sharing and trading what they own’. Now, Robert Levin introduced a new phrase — ‘Agalmics’ (he derived the word from the Greek ‘Agalma’ meaning ‘a pleasing gift’), by which he meant ‘the study and practice of the production and allocation of non-scarce goods’.

Levin’s concept of ‘agalmics’ is therefore the opposite of ‘economics’ (which, remember, is ‘the study of the allocation of SCARCE goods’). Levin argued, ‘we can be certain that, over time, more and more basic goods will become less and less scarce… we need a new paradigm and a new field of study. What we need is ‘agalmics’. When it comes to the gift ‘economy’ of SL, should we adopt the catchphrase, ‘it’s an agalmia, stupid’, in reference to what Levin called ‘the sum of the agalmic activity in a region or sphere. Analogous to an “economy” in economic theory’?

Well, this assumption depends heavily on the extent to which SL agrees with Levin’s notion of what agalmic activity is. Earlier, we saw how physical constraints like server capacity imposes limits on our freedom to create in SL. This might imply that SL cannot be an ‘agalmia’. However, it’s Levin’s opinion that ‘economics’ gives way to ‘agalmics’ as a result of the MARGINALIZATION of scarcity, not necessarily its ERADICATION. ‘Agalmics goods… are often produced using scarce goods as raw material. An important example is the initial programming work that goes into a free software application. At the current state of the human lifespan, programmer time must be regarded as a scarce good’.

In fact, Levin cites the open source software community as a contemporary example of agalmic activity. This obviously marks SL out as a definite candidate for an agalmia, because it is very much part of the OS model. Levin identifies several key characteristics of agalmic activity. Let’s look at each one and see how well SL conforms to each.

1: ‘Economic trade is finite; when I give you a dollar I have one less than I did. Agalmic activity involves goods which are not scarce, so I can give you one without appreciably diminishing my supply’.

In SL, anything can be transferable and copyable, or non-transferable/ non-copyable. Objects that are tagged as non-copyable/ non-transferable are traded according to ‘economic’ activity, because choosing to pass such items on results in you no longer possessing it. On the other hand, any item that is tagged as copyable can indeed be given away without diminishing one’s supply. In SL’s stores, items for purchase are often (but not always) marked ‘noncopyable’. But what about all those ‘transactions (that) are conducted in a barter or gift economy’ which, according to Au, makes up the bulk of ‘economic’ activity in SL? I think it’s highly likely that these transactions involve items that are copyable, allowing individuals to trade what they own without diminishing their supply. If my assumption is correct, this is ‘agalmic’ (not ‘economic’) activity.

2: ‘It is co-operative. Economic activity often involves competition. Buyers must allocate their limited funds to the supplier who best meets their needs. Since it doesn’t involve scarce resources, agalmic activity rarely involves competition. Efficient agalmic actors know how to encourage cooperation and benefit from the result’.

No doubt, whenever an inworld architect like Scope Cleaver negotiates for the contract to build something like the Estonian Embassy, his prospective client has a limited amount of land (and funds), so only requires a small team of ace designers to construct the virtual property. When it comes to negotiating for such contracts, I think it’s fair to say that this is economic activity.

However, I wonder if, overall, Cleaver feels he co-operates with the architectural community in SL? Does this community freely swap building tips and are customized tools  exchanged between fellow architects in accordance with agalmic activity as defined earlier?  And not only architects but all creative communities in SL. Does the machinima community, the photographers, the scripters, the fashion designers, ‘encourage co-operation and benefit from the result’. My gut feeling is that they do, but further investigation is required before a more definitive answer can be formulated.

3: ‘It is self-interested. Agalmic activity advances personal goals, which may be charitable or profit-orientated, individual or organizational. An agalmia typically contains both individuals and organizations, with a broad mix of charitable and profit-orientated goals. Agalmic profit is measured in such things as knowledge, satisfaction, recognition and often in indirect economic benefit.’

Obviously SL contains both individuals and organizations who pursue both profit-driven and charitable goals. But the real question is what motivates residents to fill SL with content. Of course, we all know that Anshe Chung and Aimee Weber now have joint ownership of all the gold in the Federal Reserve, since that’s the only way to pay what they are now worth. Ok, I exaggerate but (beyond the necessity of earning money to live) one has to wonder if the financial rewards the elites of SL earn really counts as any motivation at all. Cleaver once admitted to me that he would happily work for free, were it not for the fact that we all need money for daily necessities. Moreover, many of SL’s designers have told me that whenever somebody buys one of their products, what is satisfying is the recognition that what they do is appreciated and valued… and I don’t mean in a monetary sense. And then, of course, there are the masses who stock land with builds, galleries with portraits and sculptures, cinemas with machinima and generally fill SL with content but earn no economic profit for their efforts. I don’t think these people are chasing dreams of financial wealth, I think it is agalmic profit that motivates them.

4: ‘It is self-stimulating. Examples can be seen in free software communities, in which new programmers, documenters and debuggers come from the ranks of free software users’.

Here, I am reminded of an old essay by Gwyn (‘Crowdsourcing in Second Life’) in which she wrote, ‘there wouldn’t be any point of having 3300 sims available on a grid, if they didn’t have any content at all… Instead, Linden Lab learned how to employ the users — very successfully — to develop the content for themselves, without paying a cent’. I could also quote who said, ‘near-term, users will create code to address bugs and other problems, as well as do things like enable SL to run on cell-phones, or add support for different kinds of multimedia content inside the world’.

All of which sounds very much like Levin’s example of self-stimulating agalmic activity. (Why is it self-stimulating? Because ‘everybody is inspired to keep topping each other with ever cooler things’ — Philip Linden).

5: ‘It is self-directing. Free software users provide feedback to developers in the form of bug reports, patches and requests for new features. Software projects can be forked by users when an existing developer group is no longer responsive to their needs. Maintainers are then free to adopt the new work or go their own way’.

This very much applies to SL, and can only become more relevant in the future. Just ask Gwyn, who wrote, ‘things like SL Brazil show what will happen in the near future: Companies creating high quality content and providing the whole range of services that LL refuses to do: a special client, a logging-in system, a welcome area… inworld patrolling, technical support…’

6: ‘It is decentralized and non-authoritarian. In a free software community, developer groups maintain their position only as long as they are responsive to their user bases. No one is forced to participate in a project, and the projects people participate in are the ones in which they are interested. Involuntary activity places limits on exchange and creates scarcity. As such, it is non-agalmic. A particular agalmic group may be organised in a top-down fashion, and non-agalmic groups may act agalmicly. But alternatives are available and participation is voluntary. Authoritarian systems remove personal incentives for agalmic behaviour’.

Nobody is forced to participate in SL, and it’s fairly safe to assume that the inworld projects residents undertake are things that interest them. I do wonder, however, if Linden Labs conforms to the agalmic ideal of a developer group capable of maintaining its position only as long as responsive to the needs of its users. LL is the true owner of SL and, within the TOS, they are the ultimate authority. Of course, users can raise concerns, hold protests and even opt out of using SL altogether. If we all stopped using SL, LL would have no reason to exist. But, I don’t think Levin is talking about software projects simply ending due to its participants becoming too pissed-off to work on it. Rather, he is talking about developer groups being replaced if they don’t run things the way the community likes. It seems to me that LL will maintain their position as the ultimate authority in SL whether the users like it or not.

But, then again, that may change in the future, what with Linden Lab’s plans to make the whole code open source. As Gwyn commented, ‘an open source grid is naturally the dream of everybody who’s tired with LL’s recent strong measures in limiting personal freedoms. By distributing grids all over the world, and interconnecting them together… if your country is restricting personal freedom too much you can jump over to the sims hosted in another country’.

7: ‘It is positive-sum. In games theory, a ‘zero-sum game’ is one in which one player’s gain is another player’s loss. Conventional economies often describes zero-sum games. When two suppliers compete for the dollars of a single customer, or when two government agencies compete with each other for fixed budget dollars, a zero-sum game is being played. A ‘positive-sum game’ is one in which players gain by behaviour which enhances the gains of others. Efficient agalmics is a positive-sum game’.

No one could deny that there are zero-sum games being played in SL. Whenever a client awards a building contract to one group rather than any other; whenever you spend your Linden dollars in this store rather than that one, a non-zero game is being played. And let’s not forget the griefers. But, while zero-sum games definitely happen in SL, so do positive-sum games. Examples would be the people willing to spend time teaching newcomers the basics of using SL, or more advanced courses on scripting, prim-building and such. It would include the bloggers, prepared to spend a great deal of time hunting down the best SL has to offer (or highlighting its deficiencies) and bringing them to our attention. And, of course, it would include the exhange of items in a gift ‘economy’ and the move to open-source Second Life.  Teaching people to use SL efficiently and build competently increases the number of residents who can partcipate usefully in SL, bloggers with a good reputation attract a readership that keep them informed about goings-on, giving items away in a gift economy enhances the chances of your generosity being reciprocated and open sourcing SL massively increases the number of people debugging, tweaking, and ehancing it. In such ways, users gain by enhancing the gains of others.


All in all, I think it’s unarguable that Second Life is a textbook example of an agalmia. And yet, very little study of the agalmic activity in SL seems to have been undertaken. It’s now almost eight years since a little-known professor at the University of Rochester, New York, decided to treat Everquest like a real country and collect macroeconomic statistics like GDP, inflation, productivity and wages. The resulting paper (‘Virtual Worlds: A First Hand Account of Market and Society on the Cyberian Frontier’) lifted its author — Edward Castronova — out of obscurity to become a leading authority on the implications of MMOGs.

These days, one is spoilt for choice where looking for information on economic activity in SL is concerned. Putting the keywords ‘Second Life economics’ into Google returns 5, 140,000 hits. By comparison, research into agalmic activity in SL is negligible. The keywords ‘Second Life agalmics’ returns a paltry 292 hits (and none that I looked at were particularly relevant). And yet, there is every reason to suppose that agalmic activity makes up the bulk of interactions in SL, and that it can only increase as LL hands over more and more of its baby to the open source community. A thorough investigation of the agalmic activity in SL by anthropologists, sociologists and economists could not be more timely. ‘As time goes on’, wrote Levin, ‘the technology of agriculture and manufacture teaches us how to produce goods with more efficiency, at less cost. The trend in technology is an exponential improvement of knowledge and capabilities’.

Thus, the driving forces pushing us towards agalmics are inextricably linked with those pushing towards molecular nanotechnology. Our best hope for ensuring an inclusive nanotech civilization (rather than one that disfavours the majority of citizens), lies in studying the underlying mechanisms of agalmic activity in SL and guiding the evolution of the metaverse so that it may act as a bridge, enabling us to make the transition to the Diamond Age as smoothly as possible.

This essay (minus spelling mistakes shakes fist at Extropia) was also published at

Thanks to Shoshana Epsilon for the amazing picture of Extropia DaSilva, one that I always loved!

And no, I’m not Extie’s alt 😉 — Gwyn (again)

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