Immersion or Isolation?

Adieu!Not even three months have passed since Virtual Worlds 2008 presented some 150 or so companies, eager to join the virtual world bandwagon, and showed off what these companies think the future will be: roughly speaking, web-embedded, isolated virtual worlds, almost all targeted for kids and teenagers.

And a few have indeed been popping up lately. It’s not only Lively, which grows by about 2-5,000 new rooms per day (the second most active room seems to be a Brazilian one). Apparently, this was just the tip of the iceberg, as a lot of “hidden” projects were suddenly revealed.

We will need a new name to describe “social 3D web-embedded virtual worlds” (S3WEVW simply doesn’t work as an acronym), and they’re not exactly new. The market is mostly dominated by Habbo Hotel, and Disney’s Club Penguin, for kids and teenagers. Some analysts believe that their users might “upgrade” to either IMVU (more content, runs from a browser too — Internet Explorer only — but it cannot be “embedded” in a web page) or Google’s Lively. The idea is that kids all have their own blogs and pages on MySpace, and will soon start to place links to those virtual worlds (or embed whole “rooms”) on these pages as well.

Now let’s forget for a moment “how will these new companies make money” and look at the established models. For instance, Habbo Hotel makes money from selling Habbo Coins, advertising, and licensing their platform to be used on big web portals; IMVU sells currency and digital content, directly and through partners and developers. Club Penguin focuses a lot on giving parents a lot of control, and their income source seems to be mostly from merchandising (notice that Disney’s Virtual Kingdom, another take at building a 2D virtual world, “officially” closed doors for lack of interest). However, Meez is my favourite example, since it picked up where Yahoo Avatars left: allowing content for the avatars to be bought as well. And obviously they sell virtual currency as well. But they have gone a bit further. Not only are you able to use your cute avatar inside your own room (which Yahoo Avatars never managed to implement) and join Meez’s “hangouts” on MeezNation, but I’m pretty sure that Meez’s major source of income is (was?) from agreements to allow users of other social websites (like PhotoBucket) to use a Meez avatar inside their sites. In a sense, this is an understandable business model: it doesn’t rely on the success of the platform in selling virtual currency, but on the agreements they forge with partners. WhyVille, a 2D virtual world for children, uses this model exclusively — partners design content and pay for that privilege — with the interesting aspect that they tend to favour educational and non-profit organisations as partners.

Raph Koster’s Metaplace also goes a similar route: Raph claims that everything in Metaplace will be free, except for virtual currency, which will be his company’s only source of income. Metaplace is also a web-embedded 2.5D virtual world (a 3D version is supposed to be going to be launched “soon”) and targets a slightly elder audience. But the format is similar (i.e., also a web-embedded virtual world), with the difference that it’s quite more open than others: anyone can become a Metaplace developer (contrast that to Google Lively’s “totally closed content” environment; or IMVU and’s “controlled content”).

After Lively, we also got announcements from Vivaty (also a web-embebbed 3D social virtual world, with far better avatars), and Just Leap In. Both are totally competing with Google on the same audience — but with far better graphics, performance, and ease-of-use (the latter is even just Flash, so it works on any platform that supports Firefox). Either is an example of something well done. Alas, none have the Google brand behind them; and none give clues on what their business model is. For me, of course, that’s the crucial point.

Print Friendly, PDF & Email

About Gwyneth Llewelyn

I’m just a virtual girl in a virtual world…

  • Well-written post, Gwyn! I have no interest in joining Lively or any other…ahem…”S3WEVW” worlds (you’re right, someone should coin a term) unless the avatars are better than SL’s. Therefore, I recommend this realXtend video, which showcases FaceGen technology. Could this realistic facemapping be done as easily and well in SL, I wonder? I’ve heard of something similar being offered to SL users by a company whose name escapes me at the moment, but it cost $300 U.S., and the results were….ugh, frightening!

  • Goodness – you elevated one of our lovely chats about virtual world economies into one of your epic ‘blog posts: I’m honoured!

  • Ah, thanks for the YouTube link, 1angelcares… in fact, on page 3 (yes, the posts now have pages!!), I did place a link to YouTube for realXtend, but it’s not the same as yours. Indeed, I do agree: avatars are important, and not all of us like cartoons/anime characters…

    And yes, Ashcroft, it was our chat that definitely inspired me!… as well as one with Tara5 Oh from Ugotrade. We were both cursing and lamenting how the industry is basically moving away from immersive, contiguous virtual worlds to go to closed-room envirnoments..

  • I love the word InterGrid. It is very descriptive of a future VR interconnection. I plan on adopting it myself and using it regularly.

    Your analysis is very sound. It is openness and inclusion that will survive and closed rooms that will fail. And for the reasons you suggested.

    I also appreciate your focus on the business model as the predictor of future success or failure.

    Too many these days have the “If we build it, they will come” mentality, not understanding that it is marketing and a sound income model that determine success regardless of how awesome your art and tech are.

    Great work and analysis. Keep it up, we rely on you for finding out the latest in the 3D world. Thanks!

  • andar909

    hi, andar here, i just read your post. i like very much. agree to you, sir.

  • Gwyn, first I want to acknowledge you for a very obvious and well researched post. (this was probably the longest post I’ve hung in and read completely.)

    Secondly, and this ties into the first, is your wisdom speaks from not just learning from YOUR mistakes, but from the mistakes of others. This is true wisdom, and you so eloquently spoke from it.

    If those that would want to be successful in business would only understand that a community is built by its members, not THE company. And it is those members who will form there economies, the reason to come here (again and again) aka…the Long Tail “Destination Stickiness”. If they don’t it will become a ghost town, as the FREEWAY will bypass them.

    From a historical perspective:

    I lived through some really great and engaging Chat rooms, and IM, starting with ICQ, as an early adopter, (ICQ # 123563). Anyway, my point is, when a company completely controls your existence, as the old MSN chat rooms did, your communities were at the whims of MS, on whether or not your Chat Room stuck around. What typically would happen is the community broke down, most went separate ways. Hence, you now have the FREEWAY, interconnecting these communities (as you pointed out) because they know what works.

    Then you have Second Life. A community always has a dark side, a person always has a dark side. This doesn’t make them bad, per se. What makes them bad BAD is if abuse is allowed or continues. Moralizing, because the FCC has been hammered by some puritans who live in isolated communities already, and the freeway passed them long ago, is an adoption of the minority and is always short lived.

    The dilemma I see with 3D spaces, i.e.; places to go, etc…is that there needs to be a way to sustain the community based upon the members, not some web page geek, not ONE blogger, and not one SIM owner. This massive vision of the Internet also has a microcosm and those that would like to control you as a member are doomed, and its a cause to a breakdown in that community. So, we have to remain mindful not to allow anyone to control us as WE are the FREEWAY.

    Again Gwyn, beyond excellant post, and you just gained a highly respecting you regular reader. 🙂