There have been several forays by TV properties (gradually losing their audience and associated ad revenues) into social virtual worlds over the past two years. I don’t just mean branded one-off events but actually setting up shop, building a familiar and representive space for the ‘users’ to play in. These forays range from at one end, simple branded spaces pushing episodes on screens through to actually running variants of the TV format to be played out by participant avatars in a detailed build -with many points in-between. But before the meat of the post (a couple of new entrants) here is a quick list to give you an idea of some of the shows and channels that have tried, had some success or failed. As I have been involved in a few of them and visited all, I have listed ones I think have had most impact (engagement) through to those who didn’t quite get it (reversioning).

1. NBC’s Gossip Girl
2. MTV’s – Laguna Beach on There.com (also Hills, PimpMyRide etc)
3. Big Brother – PersonalizeMedia detailed report & at launch
4. Showtimes The L Word
5. CBS – CSI:New York and from TechCrunch
6. Weather Channel – Info, simulations and Extreme Sports area
7. Australia’s ABC TV Island – Channel & some programmes (eg: Librarians)
8. NBC Universal Media Island – Channel & concerts & events
9. London Live – the first music show to appear on the cyberchannel: Virtual Life.TV
10. SkyNews Island – News Set role play
11. The Money Programme BBC screening
12. Channel 4 – Radio Station
13. Sundance Channel – Virtual screening room
14. Inhabited TV 1997! – BBC, BT, Illuminations and others
15. many more…0ver to you and comments!

There is a rule of thumb regarding TV execs and virtual worlds or serious games initiatives – do not let the TV folk take control as they have too much ingrained baggage around non-participatory media and the resultant compromise is often of no use to anyone – get people who understand game play (and be aware that often excludes traditional game developers) and social media involved or face the consequences. The ones above that really worked allowed the participant audience to really ‘live’ in the shoes of the characters either by having activities similar to the protagonists, meeting the ‘fictional characters’, a social space that resonated with the shows aesthetic or a great set with game-like elements. I have talked a lot about Mixed Reality Entertainment in the past and how one of the most innovative uses of virtual space is to extend the TV or Film property into a 24/7, participatory environment. The main reason for doing this is to drive traffic to the TV but also to keep existing followers loyal to the branded property. As an example there is more detail about the reasoning on my post on Big Brother (good and bad) in Second Life (Witnessing the Birth of an Entertainment Form) as well as posts nearby on CSI in Second Life and many of MTVs properties in There.com (TV Property Branded Virtual Worlds – The Beginning). There are moves around the world including BBC and many European broadcasters who are creating worlds alongside and in some cases in front of the TV episodics and this is the important point. Promoting films with games or virtual world spaces has a very limited life span, forging a strong link between virtual world events and TV episodics is to me a virtuous circle – especially considering the 200 plus worlds populated by the youth audience who are typically turning off TV – teens and tweens. Earlier there were many experiments of TV/World hybrids and I was involved, as mentioned before, in the Mirror. Here is John Wyver (then Illuminations) talking about that (remember this is circa 1997!).

The other key element that contributed to the success of The Mirror, much as in real life, was the provision of regular “hosts” for the space. These needed to be frequent visitors who spent a significant amount of their time in the world, and whom users could have some reasonable expectation of encountering when they logged on. These hosts would greet new entrants, introduce people to each other, point out activities and generally help people around. More than this, however, over time they became the core of the community of the world, encouraging people to return and beginning to develop the particular language and culture of The Mirror. Needless to say, they were the saddest to see it turned off after seven weeks – although a number of relationships begun virtually have continued in the real world – including at least one marriage and one recently born child.

Recent company start-ups or collaborations also suggest that there are moves afoot. Icarus studios are squarely aiming at the TV/VirtualWorld hybrid and about 18 months ago Endemol & EA teamed up to create Virtual World TV formats (VirtualMe) based on Deal or No Deal and Big Brother. Also there have been a plethora of immersive film launches (play-in-the-set-type builds) across the metaverse and I Legend, Digital Hollywood, Iron Man, Quantum of Solace and Transformers spring to mind as I write – but as I said this post is more to do with a continuous, what happens on TV resonantes into the virtual world and what happens there is reflected into the TV episodics. (I regularly consult on this specific area so won’t go into any more detail!)…

So, it is interesting to see this trend continuing as new world Twinity starts to do more experiential ‘film’ property marketing and even more ‘demographically focussed’ the current series of Heroes being extended into Habbo

The agreement was brokered by the William Morris Agency and marks the first time ‘Heroes’ has partnered with a virtual world.

..but not in the usual way. As reported by LA Times “‘Heroes’ hops on to Habbo’s virtual world” they will be introducing a virtual-only character Syn Anders who will act as a bridge or guide to the TV series. NBC themselves give more detail here.

While following directions from a mysterious virtual messenger, the new character will take the audience on an adventure as she discovers the history of ‘Heroes’ through a journey that travels back and forth between Habbo.com and the ‘Heroes’ Evolutions site. “We’re excited to work with Habbo to introduce a new character that will extend the enormously popular and Emmy® Award winning ‘Heroes’ interactive story beyond the official Web site on NBC.com,” said Stephen Andrade, senior vice president, Digital Development and General Manager, NBC.com. On Habbo.com, fans of the show will be able to interact with the new virtual hero through a variety of in-game activities. Habbos participating in a weeklong quest will discover their own special powers and will be recruited as new heroes. Those who successfully complete the mission will be awarded various virtual prizes. On the ‘Heroes’ Evolutions site, the new virtual hero will be woven into several of the in-universe, interactive extensions of the on-air show, including a character profile, the Primatech Paper Assignment Tracker and new chapters of the ‘Heroes’ graphic novels.

This is a great use of virtual worlds and it also shows that you don’t need richly rendered environments to be able to engage with participants in these spaces. Also in terms of the ‘linking’ paradigm, it is close to ‘my’ level 3 wikipedia cross-media definition

Excerpt “Cross-media 3.0 – Bridges. – The truest form of cross-media where the story or service structure is specifically authored to drive the audience using strong Call-To-Actions, across media devices to continue the journey. The content placed on the other platform is critical to staying in touch with the experience and the narrative bridges tease you towards investigating or moving to another media form/platform. Obvious examples include a TV show that ends suddenly and gives you a URL to explore more. It may be an SMS that teases and points you towards a live concert in a city square which then leads you to a TV show, then to a podcast then to subscription emails. The trigger, or bridge, is the critical component of this in motivating the cross-media action.”

Onto Twinity and the images here and above are me playing around in the pre-build set of the recently released and not universally praised film The Spirit. Although it grossed $10 million in the first 4 days it was pulled up for being unemotional and 2D. Well part of the problem generally with many big features now is that audiences have changed and want something more experiential – especially with ‘comic-noir’ films – why not let them ‘live’ in the story environment (my wikipedia item)? Twinity though have teamed up with Will Eisner studios to do this event (not in any way my ideal episodic but potentially a way for the Twinity user base to ‘create episodic, comic-noir’ machinima on-going?

CineStar Spirits you Away to Another World – CineStar’s CUBIX cinema in virtual Berlin is the premiere address for all movie-related events in Twinity. The cinema is currently showing the trailer and other exciting movie material from the upcoming premiere of The Spirit, a movie based on Will Eisner’s cult 1940s comic book series, which will be coming to a cinema screen near you from 5 February. Fans of the movie can get their hands on exclusive Spirit merchandising: including posters, standees, and an incredible Spirit mask that lets you see special visual effects inworld. Find more information here. Save the date and come to the opening party!
Date: Monday, 2 February
Time: 17:00 Berlin, 11am NYC, 00:00 Singapore
Where: CineStar CUBIX

Twinity (by Metaversum, the German created virtual world) are a long ways from a mature stable platform, hence being in beta for the past 12 months or so, but are already exhibiting the best ‘world-led’ event-based, user activation. This in my mind is high on the list of reasons for likely success over many of the areas that over-hyped Second Life suffered from in the early days. OK the world is quite big and empty and many ‘social’ tools are not yet available inworld but the kind of activity quoted below (calling for videos, images, stories etc: attached to some well know brands) is great first step community building and more importantly getting a growing community to market for you. Even I had a go at one a few months ago – video embedded below BTW Metaversum you really need to improve the video tools (detached camera please!).

Submit Your Artwork and Win! – Take part in The Spirit Screenshot and Machinima Contest and win an exclusive film poster signed by cult film director Frank Miller or The Spirit action figures.
Things Are Looking A Little Different Around Here…
Wear the mask and see Twinity through the eyes of the Spirit! – Use Twinity’s screenshot and recording tools to create incredible Spirit- inspired images! To be eligible to win the contest, screenshots must be created while wearing the Spirit Mask and its ‘visual effects’ must be demonstrated in your machinima. Screenshots may be submitted in jpg, png or gif formats.
Sensational Prizes - You have the chance to win sensational The Spirit prizes! Three prizes will be given out to the lucky winners of the Screenshot and Machinima Contest:
* 1st prize: The Spirit action figure and film poster signed by Frank Miller
* 2nd prize: The Spirit film poster signed by Frank Miller
* 3rd prize: The Spirit action figure
To take part in the contest, all you have to do is:

• Submit your screenshots together with your Twinity name to quest@twinity.com or
• Upload your movie to a video sharing website, for example “YouTube”, then submit the link to your uploaded video together with your Twinity name to quest@twinity.com
• Competition deadline: 28 February 2009

We’ll celebrate the winning entries with a Winner’s Gallery party in the CineStar Event Hall! Artwork will be displayed in the CUBIX cinema during The Spirit promotion. Keep an eye on Twinity’s Event Calendar for further details!

Of course I would encourage all TV producers to think about their current audience and whether they want to reach them this way. More importantly you need to think of the appropriateness of creating inworld characters or environments for them to exist in – serious games (from documentaries) and childrens episodics are hot ones at the moment . The real effort is more about having great characters that are persistant in the space but beware of bots or NPC’s (non player characters) pretending to be real, this can have a strong counter productive effect. More later.

But back to social virtual worlds and I have quickly mapped some dates and SVW events (most are recent) onto a slightly modified Gartner ‘hype cycle’ curve. For the uninitiated here is a brief wikipedia definition.

Since 1995, Gartner has used hype cycles to characterize the over-enthusiasm or “hype” and subsequent disappointment that typically happens with the introduction of new technologies. Hype cycles also show how and when technologies move beyond the hype, offer practical benefits and become widely accepted.

Of course in reality we have really been through a sine wave quite a few times since 1987 through 2005 but since the relative maturity of services like Second Life, There and others true and robust applications are emerging, beyond the traditional ‘gamer/entertainment’ use. MUVED created a post a few weeks ago showing widespread investment in a range of niche virtual worlds and this trend is seemingly continuuing apace. Raymond de Villiers, CEO of Wisdom Games is very bullish about the use of these worlds for business communication in a post entitled Growth of Virtual Environment Expected in 2009…

Throughout 2008 the corporate world was exposed to the reality of virtual worlds, which has seen a growing influence on how companies train, market, advertise and communicate. This is a trend that is expected to continue into 2009 as organisations begin to recognise the merits of incorporating gaming into their basket of communication tools.

Raymond makes some mature philosophical points about how the corporate world is now host to a new generation of employee who don’t see these spaces as for geeks and timewasters

For those who have never played a computer game in their lives, virtual worlds look foreign, sinister, scary, and like a waste of valuable corporate resources. However, for those who grew up in a world where they played virtually, their expectation of being able to apply the consequent life lessons will be expressed in their expectations of the work environment. Computer gaming, and the associated virtual worlds, will, as a result, be seen as an increasingly important infrastructural consideration.

Virtual Worlds News puts more of a realistic spin as regards raw investment (tracked over at VirtualWorldsManagement also) into new ventures with a decline (albeit way ahead of the global recession) of venture capital put into worlds – around $101m in q4 2008. In its item $101M Invested in 13 Virtual Worlds-Related Companies in Q4 2008 VWNews believes that there is a move into older generation worlds and those with much more of a niche focus.

With the harsh economy looming larger than ever, it seems like more and more focus is being put on unique niches and markets, established business opportunities, and quick-to-market strategies.

Around the world there are major government and state agency investments looking at the efficiencies and cost savings of using Virtual Worlds. Close to home (Australia) we have the MDA in Singapore committing overall around $70 million to project and services in the virtual world education space, creating around 300 jobs in the process too. I could go on with many examples of global investment in the public sector but we are also seeing expansion of existing services in the private sector a good example being Linden Lab buying two Virtual Goods companies XStreet SL and OnRez. As reported by Venture Beat the micro economy around Second Life is still in growth and Linden Lab will need a slice of that pie (in small rev share of the user to user transaction) to continue its own growth. This is long overdue by the Second Life creators and Venture Beat were keen to state the obvious also

Virtual goods have expanded to become a $1.5 billion market, but Second Life was engineered in the days before the business model was fully proven. Linden Lab residents exchanged more than $360 million worth of virtual goods and services in 2008, making the virtual economy and the ability to make a living one of the big draws of the virtual world. Top merchants in Second Life have made more than $500,000 in real money in 2008.

So there is definitely something afoot at the moment even in serious global recession there is a kind of exodus into virtual alternatives happening. The most important message is that developing on a reasonably stable and mature platform is not a big investment and companies, education departments and entertainment property owners should still see this investment as two key returns in the ‘real time, immersive arena’  – how to create experiential services and how to engage with a community. I leave you with a diagram I created nearly 3 years ago that shows a transition from web 1.0 to web 3.0 and let you decide if and how it maps onto my mapped Gartner hype curve above.

IS THERE REAL INVESTMENT?

First lets look at investor confidence in them. From Virtual Worlds Management Reports there was $1 billion US invested in 35 virtual world companies between Oct 06-07 – and since Oct 07 to the present day there has already been $918 million trusted to the success of this particular industry. This breaks down roughly as:

• Q3 08 – $148.5 million invested in 12 VW companies
• Q2 08 – $161 million in 16 VW companies
• Q1 08 – $184 million in 23 VW companies
• Q4 07 – $425 million in 15 VW companies

As a topical reference, and to put things into heritage media perspective the total spend on all film and tv drama in Australia in 07-08 was $420 million US (at current exchanges). Now the majority of these worlds invested in are youth based but many specialised ones aimed at the Gen Y hole (see kzero.co.uk charts for more info) that are focusing on key niches. These start to fill in the gaps that ‘generic’, jack-of-all-trades, social virtual worlds such as Second Life cannot truly cut the mustard as sub-builds inside the service. So we have recently had in the last week the to user launches of a dedicated real life buy with real cash Virtual eShopping just in time for XMas and what will be a real winner in my view (having just tried it finally) the social sports virtual world, Football Superstars which combines EA-like footy with there.com-like social activity and even has a bit of WoW-like quest giving challenges.

The social aspect of virtual worlds are not lost on the big consoles either with the Launch of XBox and PS3 virtual worlds that I covered in a recent post and also the Inquirer’s article Sony, Microsoft begin battle of Virtual Worlds. I was going to talk a lot about how during hard economic times people turn to escapist activities. In the past it used to be film or TV, but now there are many more choices and as we haven’t seen a global economic downturn of this scale since the 2nd world war – the escapism of choice is now immersive interactive media. This will not be lost on advertisers who also need to optimise their spend across the many variants of shared social worlds.

BUSINESS WAKES UP

Savvy businesses have now moved beyond the hype bubble of Second Life’s superficiality and realise the power of social collective collaboration. As well as education and science virtual worlds as ‘tools’ are developing into major economic government initiatives. The Athena Alliance have released a report called “Virtual Worlds and the Transformation of Business” with some optimistic summary lines.

“The rise of the collaborative enterprise that is likely to result from the successful deployment of Virtual World technologies will usher in a new era of business. It will change the way firms compete with one another for customers in both goods and services industries. It is our firm belief that if our nation accelerates the development and maturation of Virtual Worlds, it will encourage a more collaborative and enterprising form of business. This will lead to greater innovation, sustained productivity, and competitive growth in the world economy.. the companies and workers can use the tools of Virtual Worlds to transform the United States into a collaborative enterprise-driven economy.”

The use of virtual worlds for simulation is not lost on the military either. This goes way beyond using first person shooter games to train late teens for an army life using well, first person shooter game technology in war zones. Last week the largest global simulation conference ever was held “The Interservice/Industry Training, Simulation and Education Conference (I/ITSEC)” focused on the use of more social virtual worlds for training and education for military and scientific use. It was keynoted by General Wallace, the Commander, United States Army Training and Doctrine Command who talked with other big government players about the likely hundreds of billions of dollars that will be invested in virtual simulation technology. As we know most media developments have come about from love and death, porn and war. So this growth as always will resonate in the commercial entertainment industry. An example of how military and education are mixing here is The University of Florida recently announced too that it will be spending $1.25 million on building a Second China for the US Foreign Service and Military to understand the culture without the need to go there and fail-forward.

“The goal of the federally funded research project: To educate and prepare foreign service or other government professionals to arrive in the country prepared and ready to work.”

SHOW ME THE VIRTUAL MONEY

On the money side there is a great deal of research now going into how virtual world economic models and currencies will evolve from a range of closed systems to a state that may become viable alternatives to ‘real world’ currencies. The Virtual Economy Research Network just had an interesting article on the VW freemium model – free-to-play but encourages the adoption of the inworld currency rapidly, for example.

A brief look forward and in terms of users of these worlds there is going to be a big acceleration over the next 3 years with a recent Instat report suggesting that “registered users of virtual worlds are expected to exceed 1 billion” by 2012 and total revenue is expected to exceed US $3 billion. The majority of this revenue is not from an expected subscription or advertising but “90% of their revenue from the sale of virtual items, currency, land, and fees associated with these items”. Finally a reason why there is even more investment in youth worlds “70% of the more than 300 million registered users of virtual worlds are younger than 18.”

Forester and MillionsOfUs have just published a report looking at how traditional corporate business will begin to flourish in these spaces and to quote their executive four point summary:

1. It grants unprecedented depth of engagement with consumers. Second only to inperson
   consumer meetings, virtual worlds allow marketers to get up close and personal
   with individual consumers. Using these interactions to allow for feedback, creative tasks,
   and just plain fun creates brand and product advocates in the user base who go far beyond
   in-world influence.
2. It taps into an audience that is difficult to reach via other channels. Today’s virtual
   world users are seen as a minority vanguard for future usage, but they are also difficult to
   reach via other channels. This is especially true of youth groups and deeply creative
   communities supported by various virtual worlds.
3. Newer worlds offer better opportunities for cross-channel tracking and more
   targeted audiences. Early virtual worlds, while technically groundbreaking and providing
   the necessary foundation for future worlds, often lacked audience-tracking tools and were
   open playgrounds without a specific purpose. New, recently launched worlds or those just
   around the corner will offer better tools for customer tracking and tend to target gamers,
   youth, conversation, or other specific tasks, rather than just being open. This allows better
   brand alignment and campaign integration.
4. Virtual merchandizing resonates with youth — and can be very cost-effective. Virtual
   items and other digital assets resonate with Gen Y consumers far more than with older
   (physical-media-loving) consumers. They appreciate novel, unique items and accept brand
   involvement in these items and their distribution — provided it has been thought through.
   Needless to say, the creation, storage, and distribution of virtual items can be very costeffective
   compared with traditional merchandise like t-shirts and caps.

There is no decline happening. So journos, nay sayers, please look at your own industries please. To reiterate the above examples are social or simulation virtual worlds and there are around 78 currently being used by 360 million people. I haven’t touched on online game worlds or offline games which starts to turn the whole affair into a $40-50 billion industry overtaking movies (including home entertainment elements too). All suggestions are that VWs and Games will be the dominant entertainment form and a widely used tool for business and education and revenues will start to match that of the $300 billion TV industry within five years time. A big issue for me is the lack or real courses in higher education in this space too. Most training is on how to use software to make fps console-type games, there needs to be a paradigm shift otherwise media education will be irrelevant as the heritage media linear form falls into the background.

Now tell me again that these wacky 3D worlds are about to disappear?

To finish I will be adding a presentation I gave at the Online Distribution and Business Collaboration Conference two weeks ago as it contains many references to the above post…hold your breath…

75MB MP4 Download available at http://www.justvirtual.com/SVWS_2008.mp4

A few immediate things that struck me on my travels:

• That there are quite a few worlds now getting their balance on the shoulders of Second Life and really getting to grips with the social networking aspects vs the 3D’ness
• There IS a balance between a social space and an ‘agreed’ advertorial world – “you give me valid experience, I accept a level of advertising”
• A few new entrants realise that using a fully fledged, 3D game engine as the client for what is in the end a glamorous 3D facebook and requiring a high spec’d PC is not the best way. Second generation services like vSide have followed a good middle ground
• As I reported a few days ago the ‘layered-over-the-2d-web’ version of these worlds such as RocketOn Exit Reality and Weblin show great usability and promise
• Some worlds are demonstrating the precursor to photo realism and smooth motion while others have as much ‘immersion’ by providing intimacy with your friends in more cutesy environments
• Many of these worlds operate without the hype we have seen with Second Life and have slowly been building up large communities. Beware any world that tries to launch on hype, as most of these worlds are still in adolescence and not ready for mainstream
• The Metaverse is a world of connected worlds, how/when/if they are connected will be a real challenge from a technical and standardisation perspective. Especially as a few are starting to concentrate on themes, music, sport and probably in the end very defined niches – fly fishing social world anyone?
• It is important for those who are supposedly representing or blogging about ‘the metaverse’ to get in there and try these services – beyond registering and wandering around for only 10 minutes (I could name several who haven’t a clue!) but…
• There are not enough hours in the day to attempt to truly engage with each world but it is amazing how adept you become at spotting flaws and innovation when you put the effort in
• lots more to follow from the official report in a future post…

KZero are turning out to be the best resource on the planet, tracking Social Virtual Worlds and their latent potential. They gave me permission to publish/post this great chart with a great stab at putting many of the worlds in the video across content sectors.

Here is a list of the worlds featured in my video in order of appearance:

• Kaneva
• YoVille (in Facebook)
• RocketOn
• Prototerra
• Gaia Online
• HiPiHi
• Google Lively
• Habbo Hotel
• Laguna Beach (vMTV)
• Whyville
• Twinity
• Cyworld
• Football Superstars
• Weblin
• IMVU
• Second Life
• Club Penguin
• Active Worlds
• vSide
• A Tale in the Desert
• Barbie Online
• Amazing Worlds
• Webkinz
• Worlds.com
• Spore
• Exit Reality
• and 15 others including SpineWorld, Stardoll, The Manor, There.com, Vastpark, Qwaq, PS3Home, GoSupermodel, Grockit, Croquet, Metaplace, Coke Studios, Dreamville, Dubit, Mokitown, Moove, Muse, The Palace, Playdo, Sora City, Voodoo Chat, TowerChat, Traveler, Virtual Ibiza

Social Virtual Worlds Logos

Video details:

The ‘Social Virtual’ World’s A Stage
A Film by Gary Hayes © MUVEDesign/Personalizemedia 2008

“This is not a Game” – Music composed and performed by
Gary Hayes http://www.korkyt.net

As promised a rough transcript of my keynote talk to CeBit last week based on my experience of actually building some Second Life sims, talking to those who use them and creating branded environments that have more usage than any others inworld, so far. There will be a video and/or podcast at some point from CeBit TV but for now lots of ‘nice’ words and this YouTube video I uploaded…

Click here to view the embedded video.

‘
Hello I’m Gary Hayes and thank you for inviting me here to speak at CeBit this afternoon. I hope that by the end of this very brief introduction to virtual worlds, and particularly Second Life, you will be more aware of the major changes that are happening to what we used to call ‘the web’. Virtual worlds are a new disruptive and transformative medium and one that is becoming a significant force alongside our traditional media experiences. But it is still early days. It is the silent movie era, a bit like TV in the late 40s or the web itself in the early 90s – but already virtual worlds are a place where the audience stops being the audience, who become and create their own stories. For those without any exposure to virtual worlds this talk will be a beginners guide and for those who already know something or a good deal about these 3D shared spaces there will perhaps be one or two surprises, Hopefully we will go inworld too if the connectivity gods are with us.

So what do we mean by virtual worlds. In very simple terms they are a bit like MySpace meets the Local Pub meets YouTube meets The Shopping Mall meets Flickr meets World of Warcraft – ok not that simple. We are really talking about non-game based, online spaces where people create new identities and become a part of a larger resident community. There are often no rules, only those set by the inhabitants themselves, this makes it a particular challenge for brands as we will see later (they don’t like to be told how to live!). Many of you would have heard of Second Life, with nearly 6 million registrations at the moment, but there are many others. Habbo is interesting as a simple isometric service for teens now with 76 million registrations and nearly 8 million regular users. Playstation 3 is about to launch ‘home’, a sort of virtual apartment suburbia connected to other PS3 players and EA games has just teamed up with Endemol to deliver what we sometimes call Mixed Reality (cross-over programmes between TV and virtual worlds). There are quite a few others such as there.com, Kaneva and many new kids growing up on the block such as multiverse, croquet or outback online. MTV Networks used the there.com engine to do some extremely interesting TV/Virtual World cross-over services like Laguna Beach, which I sadly won’t have time to talk about. Common to all of them are people using these shared worlds to interact with others around the globe, for hours at a time.

So what are the forces at work here, what is driving this change? Well I suppose there are two key ones. The first is the shift from humans wanting the internet to be more than the rather lonely and non-real time experience to one where as a ‘participant’ they can have real time, collaborative and far richer immersive social interactions. Note I am careful to not call them, the audience – be aware that any media that still thinks of the residents of virtual worlds as audiences are doomed to failure. The second force at work here is to do with residents in worlds wanting to be far more active, creationist and imaginative. They are creating their own experiences versus passively consuming media, such as on TV or via YouTube for example. You have all heard of web 2.0 (blogs, wikis, flickr – the sharing web) well I like to think of virtual worlds as ‘part’ of web 3.0, the real time, co-creative web. It is still about sharing but in a far more natural setting – this is a space where you can walk up to someone and ask “Where can I buy some shoes and will you come shopping with me” versus typing the word shoes into some abstract search engine on the web and spending hours looking at flat pictures. A question I often get asked is, “Is this hype and something that will go away?” Absolutely not. I am old enough to have lived through the dawning of the web and early failed 3D world services, this is totally a part of that on-going evolution and this will now be here for good. The real question that should be asked, and perhaps the focus of my talk, is how are brands and professionals attempting to integrate into these spaces, will they create a virtual paradise or another dotcom burst?

The thing that’s common with all virtual worlds is the real time shared experience, and that should be the key to anyone thinking of setting up a branded space inside these worlds. Participants want to be just that, participants and co-creators. In a world like Second Life (now four times the size of San Francisco around 210 square miles) and where 99% of the content is made by the inhabitants, for a brand to simply plonk some souless buildings, or theme park, or even well displayed real world product falls way short of what the residents actually want. The message that we are getting from the inhabitants is for businesses to “play with me, don’t sell at me.” This is very important. These worlds are extremely ‘sticky’ and inhabitants invest a great deal of themselves in co-creating the environment and the numbers speak for themselves. In second life at the moment there are over 200,000 unique entrants per day spending an average of 4 hours in world – that’s nearly 1 million user hours, and with a population growing at around 30% per month you can see why many other virtual worlds will be popping up in the next few months and years to meet this demand.

Lets have a look at a very short video (which can also be seen on the Project Factory stand throughout the day) showing some of the social activities, the thing that is really driving demand in these environments.

SELF CUT VIDEO “a montage of a variety of experiences” (in background starting up SL if connectivity for demo)

So a brief taste of what goes on inworld, very experiential activities such as dancing, sport, ‘inworld tourism’, education, collaborative building and so on. These are often missed or ignored by the mainstream press. With my other hat on as Director of the Laboratory for Advanced Media Production at AFTRS I am also active in the educational areas in Second Life where collaborative, experiential teaching is growing into a powerful tool – a very vibrant and active community. But who are the real inhabitants? In Second Life it is far from being just young males. The average age is 33 and women constitute around 43% of the total. Interestingly the time spent gender wise is reversed. Of the total time spent by all participants, females account for 60%. Looking at the international split around 31% are from the USA, 48% Europe and 21% rest of the world. Europe is by far the fastest growing area now with growing numbers of English, French, Dutch and Germans so the servers (currently in San Fran and Texas are in the wrong place!). Back to the age question, one fascinating statistic I gleaned last week from Phil Rosedale, the CEO of the makers of Second Life, was that those over 60 years old spend 30% more time in Second Life than those aged 30. Lets try to pop into world now, hopefully, and have a quick two minute wander.

DEMO INWORLD. This space is called the Pond. The one that the Project Factory produced and built for Telstra BigPond. I am not sure who is around but regardless lets have a look at how Second Life works. That is me, the one with the wings and here I am at the main welcome area. Lets go for a short walk, if we meet anyone we may have a chat. It is important to have a welcoming or totally unique environment, look the ripples on the lake, palms, things to do, boating, dancing and of course a popular pastime, flying – (impro a bit here depending on audience reactions). I would like you to notice too how the advertising and brand presence is not ‘in your face’, more about that later. CLOSE DEMO.

Second life is not just about sex, money and griefing. Griefing, by the way, is a term used to describe irritating behaviour, which actually is extremely easy to control. Most of the stories you hear about ‘virtual terrorism’ is really a toxic combination of unprepared companies inworld and the media that likes to find ‘an angle’, just like the real world then. The Project Factory and other Second Life developers have many easy to implement strategies to reduce this to a minimum.

Onto money and opportunities for brands. For the moment it is about getting in there early (first mover advantage), learning about what works and collaborating with the existing resident communities. This both shows that you are ahead of the curve but also open to really having a direct relationship with your customers and most importantly learning from them. It is a way to reach and understand your existing clients and prepare for what will be a mass audience in a very short time. A recent inworld survey by CB News in partnership with Rep̬res asked over 1000 Second Life residents their opinion of real world brands and there were some surprisingly results. 66% believe that the presence of RL brands has a positive impact on SL and 45% of respondents even want more brands because they enhance and give more credibility to Second Life, a realism and make SL more interesting, by increasing the number of residents. But at the moment we are not talking about mass audiences. Successful brand presences, and two of the recent Project Factory builds in Second Life are in the top five, may have anywhere between 30-60 thousand unique visitors per quarter. These will seem like small numbers to some brand owners and advertisers, but, and here is where it gets very exciting, the inhabitants are spending anything between 15 minutes and 6 hours per visit to your brand! That figure is unheard of in almost any other media even more significant and important for those concerned with reach is that those residents are the most active in the blogosphere, and millions of impressions are generated outside these worlds Рthey tell of their lengthy experiences in the other social networks.

Shopping in virtual worlds is actually fun for the inhabitants and comes up as one of the most popular pastimes. The ability to browse products alongside your trusted friends is more akin to the mall than eBay of course so this is a real opportunity for those who want to attempt to make in or out of world sales. The more progressive companies are allowing consumers to co-design product and even order real world product from within the environment. A simple example. Very similar experiences to real life are being created in these worlds such the shared ‘media’ experience – listening to music, watching movies with others is pretty cool, you can chat and play-around with your fiends alongside the latest film. Dominos pizza realised this early and now allow you to order your ‘real’ pizza while you virtually watch movies with your ‘distributed friends’. Domino’s IT director Jane Kimberlin said “Second Life is where Domino’s customers are and therefore that’s where the pizza company needs to be too.”

How to make money? As is well publicised (in fact I can’t believe I am still talking about this) Linden dollars is the Second Life currency which can be converted into real world dollars. There are some businesses operating in Second Life that are earning real money selling virtual products. These include clothing, dance animations, selling or leasing property, buying even selling shares and the number of Second Life residents generating more than US$5,000 in monthly income has more than quadrupled to 116 in the past year, according to Linden Lab. Also brands who create product inside Second Life own the IP inworld and more importantly they retain it if they move it outside and create out of world, real product, so great news for inworld R&D. But selling things shouldn’t be your focus. It should be about integrating your brand and becoming a trusted addition inside this unique and vibrant social network. You must add value and not just build and run or build and not be around to welcome your visitors. There are way too many empty branded spaces in some virtual worlds. Lets see some of the brands that have already taken the plunge, this is a short edit of a longer video I compiled on the stand and it looks at a few recognisable names.

SELF CUT VIDEO: Motion grabs of branded spaces in world. 3 minute edit of the longer 30 minute stand one.

Quite a few recognisable brands there, so how are they doing?. Well on Thursday last week I went inworld and using the built in Search/Places facility which brings up the standardised traffic figures I looked at the ‘dwell’ traffic for each of them. Dwell is not just how many visits but how much of their inworld time they spent with each of the major brands. Also the inworld traffic measurement is the only real way to compare like with like which is why I am showing it to you. So here are the results.

1. BigPond – 18139
2. Pontiac – 13832
3. IBM – 12850
4. Showtime (L Word) – 7233
5. ABC TV Australia – 6898
6. NetG Training – 6536
7. Mercedes-Benz – 5656
8. Nissan – 4269
9. Mazda – 2827
10. Dell – 2759
11. MTVN – 2317
12. Toyota – 2119
13. Sun Microsystems – 1728
14. Sears – 1596
15. Sony BMG – 1560
16. Cisco – 1521
17. Adidas Reebok – 1351
18. Sony Ericsson – 1242
19. PA Consulting Group – 1138
20. Circuit City -1089
21. Reuters – 1019
22. BMW 842
23. Intel – 829
24. AOL – 797
25. NBC Universal 745
26. American Apparel – 596
27. Starwood Hotels – 35

Great news for Australia with BigPond and ABC (built by the Project Factory) in the top five and this is months after launch, so outside the hype curve. But why are some of the others so low? All those wonderfully designed, branded buildings with lots of things to do? Well to me a couple of the critical elements that many brands have missed are -
Firstly– Creating spaces that are just really nice to spend a long time in. Sounds simple but many corporate builds are just cold and too representational. They should be organic, of value and welcoming and where inhabitants can create their identities inside their own stories. Of particular note is the outback bar area of the Pond which is currently in the top ten of all second life brands itself on a ‘dwell’ basis, but more importantly it is part of a mix of features and functions that you need to create.
Secondly – A space where the inhabitants can create or contribute to the environment. So both The Pond and ABC have sandbox areas where residents (particularly new ones) learn to build and add things to the branded space. Also requests for changes from the visitors to the existing build should be taken seriously and acted on. Give them a sense of ownership of the space and they will thank you which will build trust.
Thirdly – Be authentic and talk to them at an equal level. Too many companies still talk down to their customers as their avatars do the ‘hard sales pitch’ thing. This is a real opportunity to show the human side to the brand, give it personality and again that insight will be endearing to the residents. A major consideration for many brands is to actually commit ‘real life’ people to be in the environment with the visitors 24/7. If you think you wont be able to collaboratively manage the community by factoring in the human resource follow-up, it might make sense not to start at all.

Advertising in these worlds are often seen as a big no, no from those inworld. Especially the old in your face, irrelevant, broadcast ad model. One thing we are experimenting with at the Project Factory is personalized and targetd advertising. This is not some Orwellian (or Minority Report) nightmare, more a way that the environment (at its crudest level ad hoardings) will change dependent on who is around them but there are many more subtle ad R&D experiments we are trailing. We, like many other developers, are learning as we go along and will never assume that this sort of functionality will prevail. An area that we definitely believe is here to stay is allowing residents to creatively interact with your brand or product. So let them co-design new product with you and listen to what they say about your existing products or services. Never before have brands had this opportunity to be so close to the consumer, you are in there with them, in real time, collaboratively.

Companies succeed in virtual worlds when they take much more of a lifestyle approach to their marketing. Whether you choose to go down this road and participate or not, Virtual Worlds will remain to be one of the most compelling ways we will interact socially and commercially in the future. The Project Factory’s virtual world services are also about merging the real with the virtual and creating experiences that are interactive, social and immersive. It is a very exciting time to be involved now at the dawning of this very real, virtual revolution. I hope that this brief talk wheted your appetite. If you want more come talk to us on our stand and check out the website listed here.

Thank you and time for a few questions?

and not mine but a great video about potential for brands (albeit slightly smoke and mirrors re: the interactions in this video) from Text100 and thousands of views on YouTube.

Click here to view the embedded video.

Posted by Gary Hayes ©2007