Virtual Worlds: 2009 Snapshot

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After an intense blaze of publicity and fascination for both consumers and businesses in Second Life (and other persistent virtual spaces) the gloss really came of virtual worlds in 2007/08. Subsequently in the past eighteen months, as the popular imagination has swung to new social phenomena such as Twitter and Facebook there has been very little commentary from either the consumer or business perspectives on virtual worlds.

However, whilst the public and media love affair with Second Life and its ilk apparently cooled as quickly as it flared, virtual worlds have continued to maintain and grow populations of users albeit without the hyperbole or acceleration of the 2007 halcyon days.

Interestingly, whilst brands have stopped investing in 3-D “storefronts” and high profile players such as Google have withdrawn from the space others such as Sony Computer Entertainment and IBM have continued to invest. Sony Computer Entertainment launched Home as its Second Life equivalent available on the global Playstation Network claims to have attracted 7m registered users. In the enterprise space IBM continues to invest millions of dollars annually in innovation for 3-D environments and workflow / collaboration tools such as avatar driven virtual meeting spaces and customer service.

At the same time, despite the downturn in publicity, “traditional” virtual worlds such as Second Life still exist and are growing. At present Second Life, with 20m users and IMVU with 40m users – which is more of a virtual 3D IM client than “world” – are the two biggest players with the next five biggest as follows;

PS3 Home 7 million
Free Realms 5 million
Red Light Center 3 million
There 2.5 million
Kaneva 2 million

(source: www.kzero.co.uk)

So whilst we don’t expect to see a renewed rush from marketers to build branded Second Life presences in the short term its worth keeping  a close watching brief on the development of 3D spaces and tools as part of a broader social media mix.

The key thing for brands with regard to their ROI on developing 3D presences was the realization that relatively to the internet (or even mobile phones) there just weren’t that many people in virtual worlds to justify the investment.

A key reason for this is simply the “barrier to entry” for the average person to enter and then thrive in a “complex” world like Second Life. The level of skills required to even play at a basic level were simply too high and required too much time to learn for these worlds to really crossover into mass market adoption at the scale of the open web. We think this is a central driver for success and that there is quickly approaching a point at which these environments will become easy enough for the casual user to join and prosper as to make them very interesting once again for marketers ie virtual worlds will become much easier to use – similar to the point at which operating systems like Windows came into existence and meant that “average people” not programmers could use a personal computer.

Examples of this can be seen in the ongoing development of social / casual games such as Habbo Hotel and more recently Zynga’s portfolio of Facebook games such as Mafia Wars and Farmville which straddle the “traditional” divide between 2D casual games such as Suduku and complex virtual worlds like Second Life but are much easier to play.

As a final point to keep in mind, its worth remembering that ITunes emerged from the Ashes of Napster’s downfall shortly after the first wave of online music it that it led changed the game for Music downloads by bring it to the masses.

Tagged as: 3d, Virtual Worlds