Who Has Time To Live A “Second Life” When the First One is a Handful? 1.8 Million People & Counting

December 7, 2006 by Lisa Oshima | Review, Social Media



  • Are you looking for a thrill and hoping to strike it filthy stinking rich?
  • Are you a risk taker with disposable income and time on your hands?
  • Want to own a huge house in a great location?
  • Want to make friends on-line?

If you’ve answered “YES” to all of these questions, forget about buying lottery tickets or founding a start-up, why not invest in real estate…VIRTUAL REAL ESTATE?*.  Never before has property in California and New York been so affordable.  Since launching on September 26, Weblo.com has managed to flog the entire (virtual) state of California on its site for $53,000 USD.  New York State sold for $18,433 and the Canadian province of Ontario sold for $16,900. Weblo is a virtual world – the first one to virtually duplicate the real world of properties, cities, states, and Internet domains – on-line.  According to Weblo:

The virtual mayor of Washington D.C. sold his city for a 300 percent profit. The virtual Empire State Building, originally purchased for one dollar, recently sold for $250. Members flip virtual properties for profit just like in the real world.

Weblo is a one of several emerging web-based social networking sites that revolves around a “Metaverse”.  In his 1992 sci-fi novel Snow Crash, Neal Stephenson coined the term “Metaverse” to refer to the virtual reality-based Internet world, which might evolve in the future.

Snow Crash.

Weblo is unique because it is the first on-line virtual world/ “metaverse” that virtualizes “real cities in the real world.”  However, Weblo is by no means the first or biggest “virtual world” out there.  From what I can tell, that accolade goes to Second Life from Linden Lab of San Francisco.

Second Life launched three years ago and has quickly become one of the most interesting social experiments on-line. The virtual “World” of Second Life is currently “inhabited” by 1,855,135 members – Avatars, who are imagined and controlled by real people from all over the world.  Unlike Weblo, the “World” (metaverse) of Second Life does not mimic property and countries in the real world – the topography is wholly imagined and developed by its inhabitants.

There is a “Marketplace,” which uses its own currency (Linden Dollars) to buy and sell virtual products and real estate inside the Second Life metaverse.  Second Life’s “inhabitants” interact with each other within this metaverse – just as real people interact in the real world.  Members create “virtual” products (3-D digital representations of real-life products or imaginary inventions), which they buy and sell inside the metaverse.  Linden Lab sells (and rents) virtual real estate to its inhabitants, which those inhabitants can then buy and sell themselves.  Second Life is free to join, but members pay $9.95 US a month to own land, and they pay a Land Use Fee proportional to the amount of land they own.

The Second Life Marketplace is thriving, and Linden Lab and the avatars aren’t the only ones benefiting financially… The real people controlling the avatars are trading in Linden Dollars for real ones – lots of them. According to Linden Labs, the Second Life “Marketplace” generates “millions of US dollars in monthly transactions.” Linden Dollars are being exchanged for US Dollars on several on-line currency exchanges (including LindenX) in record numbers.  In the last 24 hours alone, the equivalent of over $655,000 US Dollars has been spent inside the metaverse of Second Life, and the LindenX traded nearly $107,000 US Dollars.

Last week, Ailin Graef, the real-life person behind Second Life Avatar, Anshe Chung, announced that over the last two years, she has amassed the equivalent of $1 million US dollars of assets within Second Life’s metaverse, largely by buying and selling real estate.  Graef and her husband, Guni Graef, live between China and Germany and own their own real-life business focused on the “metaverse” (on-line virtual worlds), which includes perpetuating Anshe Chung’s real estate assets within Second Life.

Graef isn’t the only one making substantial money through Second Life.  The Times Online reports that real-life software developer, Gareth Lancaster, 33, from Derbyshire, England, makes a second income of between $20,000 and $30,000 US Dollars a year by selling virtual roller skates and vending machines in Second Life.  Over the last two years, Lancaster, operating as his Second Life avatar, “Moopf Murray,” has sold 60,000 pairs of virtual skates (for $60 each) to other avatars in Second Life.

Second Life has managed to grow virally very quickly– initially by appealing to highly technical users and expanding its user base to non-technical people from there.  Users don’t need to be technical to participate in Second Life. Linden Labs offers users tools that make building an avatar and participating in Second Life possible for anyone who knows how to use a computer.  Second Life gives its users an opportunity to be creative/build things, work with technology, play a game (of sorts), make money, and more – all from their computer.

Second Life is one of the greatest success stories in social media to date. With a growing subscription base of over 1.5 million users (nearly 700,000 of which have logged in within the last 60 days) and a thriving economy that is worth real world money, Second Life is attracting lots of attention – from marketers, press, and prospective users.  It is a virtuous circle that looks set to continue.  Second Life is much like a more elaborate version of top selling video game Sim City (which has sold millions of copies over the years), except that it is much more interactive and entirely built by its inhabitants and evolves in relevancy to the real world over time.

Marketers are seeing this potential.  This phenomenon is well documented.  Earlier this year, in the Harvard Business Review, Senior Editor, Paul Hemp wrote about the benefit of marketing real products to Avatars.  Hemp believes that metaverses like Second Life are fertile marketing ground because, “marketers [in Second Life] have the opportunity to interact with engaged minds.”  Plenty of real life companies agree.  In June 206, American Apparel was the first store to open up a store inside Second Life.  In September 2006, Starwood Hotels opened up a preview version of their forthcoming real-life hotels in Second Life. was the first real life company to open a hotel in Second Life.  Reuters has assigned a reporter to Second Life whose avatar reports on the goings on inside the metaverse of Second Life.  The list of companies that are involved in Second Life is impressive and growing.

Despite all of the press, plenty of members of the public haven’t heard of Second Life.  Of those people who have heard of Second Life, plenty of them don’t “get it” or understand why it is a compelling marketing tool.  Case in point, when I told some of my friends, family, and former colleagues who read this blog that I’d be writing about the successes and future potential of Second Life, I was met with blank stares and looks of confusion.  For those who don’t understand it, Second Life can seem more than a little bit bizarre, and it’s easy to see why.  As 35-year-old Second Life member, Mitch Joel writes in his blog:

As I get more involved in Second Life, I am starting to realize how psychotic I must sound when I talk about it in real life (or First Life).

Trying to explain the benefits getting a “Second Life” to people who already have a full “First Life”, will be one of Linden Lab’s greatest challenges.  In an interview published yesterday,  journalist Stephen Hutcheon asked Ailin Graef something a lot of people are wondering:

Why [do] otherwise intelligent people would spend real money on virtual assets, none of which could ever be seen as necessities and all of which can only ever be used inside the Second Life community?”

Graef’s response was priceless:

This question is closely related to another question: Why do otherwise intelligent people spend real money on so many things in the real world that are not necessities? I mean, what do we really need to survive and to stay healthy? How much of our spending, even in real life, is driven by the desire for individualisation, self-expression, entertainment or communication?

I’ll be the first to admit that I haven’t spent time Second Life or purchased virtual real estate (there or anywhere else). It’s not that I’m opposed to trying it.  At the risk of sounding geeky, I find the possibilities of Second Life fascinating.  The trouble is that I have my hands full with a very busy “First Life” of my own – a large percentage of which is already spent on-line emailing, blogging, researching, and social networking.  At this point in my life, it’s tough enough to make time for a First Life being myself – never mind paying for a “second life” acting as a fictitional avatar.

*Note on the first paragraph– I’m not being serious.  If you’re looking for an investment strategy, talk to a licensed investment advisor (I’m not one).

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  • I've just joined SL couple of days ago after all these time. Well, I couldn't before until I got my new computer this weekend but that's another story. I think it is very interesting concept, much like IRC in the early 90's and IM in the late 90's, when the general public do not 'get' it. But guess what? Now most people know what an IM is, and I'm sure in another year or so they will also know what SL is and probably have an avatar there just so they can get in touch with friends & family.



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