L$ as a currency in the real world – a step closer?

Linden Lab has just revealed a nifty feature implemented on XStreetSL, the web-based shopping site for Second Life that they acquired a year ago. Following the downtime on March 3, two things were immediately apparent: firstly, a slight tweak on the design elements allows now XStreetSL to have a “fluid” layout, getting rid of the ugly, nasty horizontal scroll bars that were a hallmark of XStreetSL from the very beginning.

The much more interesting announcement, of course, was the ability to directly use your L$ stored in your avatar’s account on XStreetSL, and vice-versa, immediately transferring L$ from XStreetSL to your avatar. It might not seem much (it had been promised since last year), but there is some dramatic magic going on beneath this apparenly simple, yet useful, feature.

Most services that have L$ transactions associated with it — and this is not just XStreetSL; think about web-based rental systems or the many audio/video streaming providers that accept payments in L$, or, of course, the alternate currency exchanges (which offer a far wider range of payment systems beyond LL’s offer of PayPal and credit cards) — have a rather difficult time in swiftly moving L$ between avatars. The main issue is that, although Second Life is by far and large the vastest digital marketplace for virtual goods in the world (yes, it beats Apple’s App Store!), it has a very primitive programming interface to deal with money transactions.

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Not There Any More

Launched at about the same time as Second Life, There.com used to be seen as “SL’s little brother”. For a long time it used to be compared with Second Life as one of the few serious competitors out there, in the sense that it was a long runner, that outlasted the period of venture capital funding. While the avatars and overall scenario was of inferior quality compared to SL — even in 2004-6 — it had at least three major advantages over SL: vehicles worked quite well; you could have a tighter control over your environment and friends (e.g. “the grieferless utopia”) which made MTV select it over SL for its Virtual Laguna Beach project, alleging that Linden Lab didn’t give MTV the kind of tools to enforce a rigid control over users and content; and it was stupidly simple to use. It also had a way for users to engage with the community and get “ratings” and “goals” to follow doing social activity (something which recently was brought up for SL as well).

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Second Life 2.0: The Revolution

Here it is: the much-awaited Second Life 2.0 Beta viewer!

Click here to view the embedded video.

To the best of my knowledge, this viewer was the result of over a year and a half of coding and testing. The overall layout was designed by Big Spaceship, the company that Linden Lab has outsourced their Web redesign — and the in-world viewer too. It’s not surprising, therefore, that the new viewer looks slightly like a web browser :)

As with all changes released by Linden Lab, this will split users in the usual two groups: the ones that are immediately fascinated by the new look, and the ones that will hate it with bitterness to the point of despair. There is no accounting for taste; expect many old-timers to write long posts about all the things they hate about SL 2.0. And, of course, for many, the hype and expectation was so great that they will feel disappointed. They might expect much more and blame LL for falling short on expectations. Again, this kind of reaction is unavoidable.

There will be hordes loving the new viewer, and furiously attacking the nay-sayers and the old-timers publicly on forums, blogs, and in-world events. There will be Emerald die-hard fanatics that will simply refuse to even consider downloading the new viewer. Even though the 1.X generation of viewers will be discontinued when 2.1 comes out (due in the summer), a large proportion of residents will simply refuse to learn how to use the new viewer and continue to use the old ones. I’m quite sure that the next few months will introduce heavy flame wars all over the SLogosphere, and we ought to be ready for it.

Why? Just because the new SL 2.0 viewer is so different. All the features of 1.X are there, and a lot of new ones have been scattered around the new user interface, but it requires relearning. It’s like someone finally switching from Windows to Mac OS X: it works pretty much in the same way, and you can do everything on a Mac that you can do on Windows, but the interface is utterly different. Even the argument that “it is much more logical, rational, and user-friendly” has failed to move more people to Mac OS X, so it’s naive to think that these very same arguments will convince every die-hard SL 1.X lover to switch to 2.0.

Ultimately, however, they won’t have a choice (at least until the released open source code gets incorporated on the third-party viewers, something that will take some time). And here’s why.
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Skin magic

Warning: eventually very shocking images below!

The year was mid-2004. For anyone who had just registered and joined, it looked like a wonderful, pretty world. Avatars were less cartoonish than, say, on There.com, and with some tweaking they would even look minimally decent.

Well… honestly, that’s how I looked like back then:

All right, I know — you’re not impressed! But this picture shows my own shape, created on my very first day, and the standard, ugly, Linden-created rubber skin. We all were ugly back then, so although this picture gives me the creeps these days, we thought it was actually pretty good, compared to other virtual worlds!

Then in early 2004, people like Namssor Daguerre thought about this very seriously and wondered if there was no way to change the default skin. At that time, remember, all they had to work with was a 2D “clothes template”. If you have seen the ones that Linden Lab publishes, you will quickly see that it’s not obvious where exactly each pixel will ultimately appear. And even if you figure it out, it’s not easy to do a whole skin. Back in 2004, we all thought that it would be “easy” to get some RL pictures of someone and just “distort” them properly so tha they “fit” on the 2D template somehow. Believe me, I’ve tried that; it simply is impossible to do it correctly. In real life, 3D artists would probably project a 2D picture on top of a 3D mesh, and then extract the appropriate 2D map (also called an “UV map”). But, alas, in 2004, Linden Lab did not release the 3D avatar mesh, so this approach was out.

Instead, 3D skin designers would have to do all the work manually. Yes, that’s right: the whole skin had to be carefully painted, pixel by pixel, on top of the template, taking into account that the avatar mesh has a lot more polygons on the face than, say, on hands and feet — which would have “stretched” bits if this wasn’t correctly done. Hand-painting a realistic texture was not for the faint of heart!

This is the result, one month after that other picture, when I bought Namssor Daguerre’s first-generation skin:

Wow, what an improvement! Well, I know this is not an image good enough for 2010 (you can just look at the low quality of the top I’m wearing!) But you can see how the shape did not change. SL didn’t change either, it wasn’t some sudden feature improvement overnight (you can see that on the background). Notice, however, how the face doesn’t look like “rubber” any more. It looks like skin, as it should! There is some detail lacking (specially on the arms) but far, far better than the Linden skin… even for 2005!

Of course we all know that Second Life has improved fantastically (yes, really!) over the years. So the last picture, which is quite recent (from today!), shows Namssor Daguerre’s third and latest generation skin.

Well, of course this is five years later… so no wonder it looks much better :) It is, after all, a new renderer; a new lighting system; and, of course — far better accessories (like prim hair!!) which have been designed for realism…

Now the surprising revelation: I’m wearing the exact shape I had in early August 2004 on all these pictures! Oh yes! Well, there have been two tweaks — a very minor one on my nose, and, after tons of complains, I reduced my, mmh, bra size… lol. But the rest is pretty much the same! Specially when you compare with the first picture, you’ll see the amazing difference, which is almost unbelievable…

That’s the kind of magic that a skin makes in Second Life. And you’re welcome to look at Namssor Daguerre’s current offerings at his shop on the Beta Business Park, which launches today with a Grand Opening which will last several hours, with models showing off the many choices on the catwalk, nice music, and a friendly environment :)

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“How do I make money?”

Gwyneth Llewelyn in Colonia NovaLet’s face it: we all were newbies once. While some of us might have immediately plunged into a creative spree like never before, and just remembered after two months that our avatar was in its newbie clothes that they started with, this is hardly the case of the majority of new users…

Sooner or later — often sooner! — a new user will know that they need money. They might have read magazine ads telling them how successful business in Second Life® is. They might have browsed through blogs and forums, catching numbers here and there, on how much money is being transacted in SL, and how some content creators and live music performers make a living here. They might even have come to a conference or two at the Beta Business Park and listened to people talking about their business experience in SL. Or they just looked up on the top of the screen where it says “L$0″ and wondered how to get more.

No matter what the reason was, usually rather early in the process of getting acquainted with Second Life, one of the very, very first questions asked is how to make money in SL (often seconded by “will you give me some L$?”). Unless, of course, you just came in for the dating :)

Traditionally, the usual answer you give to an intelligent new user is that it’s “as hard as to make money in the real world”, and follow that up with a comparison with making money from Web design. Some helpers just take the trouble to describe what you can create, from buildings to clothes, from scripting to animations, and patiently explain how you develop a brand in SL, make it a successful, and retire on a Caribbean island (even a virtual one!).

The casual user, however, is not interested in how to make money that way. They want to make money fast. They know they’re unskilled, so they hardly expect to become the next super-architect or boots designer in SL, but they still want money. Quickly. Painlessly. Without an effort.

At this point, most helpers just shake their heads and sigh.

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The First-Hour Experience

The 2004 Orientation Area, rendered with 2009 graphicsThe Christmas season is over and Second Life®’s shops were teeming with happy new clients and making the Second Life economy rock’n'roll! Or… were they?

I guess that we will only have a definitive answer to that when Linden Lab reveals the transaction data for December 2009, and compares it to last year. My guess is that the difference will be small — enough for Linden Lab to tell everybody that the economy is growing as usual (or as predicted), but it won’t be growing 900% a year, like it did from 2006 to 2007. If it grew 9% this year, it would already be quite nice.

There is, however, something that seems not to be growing at all: the number of residents that remain in Second Life. We are still getting the usual number of signups, close to 10.000 per day. It’s not exactly zero growth! But… none of them stay long enough to make a difference in the number of active users. Linden Lab, for the past few months, have dropped the number of registered users from the statistics and just announce the number of active ones: around a million these days, although I have seen lower figures quoted. The number of users on the login database, however, probably reach 17 million or so, but that’s just my guesstimate.

Where do all those 10.000 users-per-day go? Why don’t we see them around? Why do they leave, often merely minutes after they’ve registered? What’s so fundamentally wrong with Second Life that scares so many users away?
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The End of Freebies?

L$0 is forbidden!What is the value of content in Second Life®? This might be the most stupid question to ask, but… did you ever ask yourself why things cost what they do?

We have to turn back the clock a few years, to the time Linden Lab introduced the stipends. Every Basic Account used to get L$50 every week they’ve logged in; Premium Accounts got L$500 every week, no matter if they logged in or not.

This set the reference for the price of things in Second Life: content creators targeting newbies (who would start as Basic Accounts) would know that if they priced it from L$0-50, they would get newbies to buy their content. If they wished to go upscale and sell to Premium Accounts, up to L$500 would mean that they’d get a sale per week. That’s why the first generation of outfits (usually just two pieces!) would cost up to L$500, since you expected residents to buy one per week (hopefully!). Skins, or other items that wouldn’t be bought every other week, like vehicles or animation overriders, would cost around L$2000, since you wouldn’t expect them to buy a new one very often. So that’s why things cost what they do :)

When GOM first introduced their currency exchange for Second Life, a similar question was asked: what would be the “fair” price to charge, in US$, for a handful of L$? Again, we needed a reference. Since the easiest way to get L$ in-world was by being a Premium Account, and that costed US$9.99/month (less if you paid annually!), and this got you L$2000/month, it meant that LL “valued” (indirectly) L$200 to be worth 1 US dollar. Well, almost: since the cheapest way to get L$ was to pay an annual fee — for US$72 — this meant that you could get L$333 for 1 US$. There’s your range — from L$200 to 333. Average it, and you get L$266/US$. Now you know why the L$/US$ ratio has been floating around that “magic” value for so long :)

Finally, land is also valued used similar baselines, although here the concepts of “speculation” and “location” play a huger role! Still, like in real life, you can see that the cost of land can be compared to the “base welfare stipend” (the original L$2000/month) which included 512 m2 of tier on the mainland. The value of land overall is tied to this and is not totally arbitrary.

So knowing the base metrics that define why things cost what they do in Second Life, we can ask ourselves next: what will be considered a good, successful SL-based business? And what will distort the market? And this will finally let us ask us the last question: should Linden lab attempt to “regulate” the market (in the good, European sense of the word) or just let it do whatever it pleases and whatever the results are (in the American sense of the word)?
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Second Life Enterprise and the Business-Oriented Virtual World

B2P-Fall-Conference_Gwyneth-Llewelyn_01.jpgOn the day that Linden Lab launched their major business-oriented product, Second Life Enterprise® (formerly known as “Nebraska”) and its companion site, Second Life Work Marketplace®, Google links to it went up from zero to 14,000 in a few hours (there are now almost half a million as I write this!). Not only the SLogosphere reported on this very thoroughly, but the major news media didn’t miss the opportunity to talk about it either, from the Financial Times to Information Week. According to Amanda Linden, who lead the incredible effort of promoting this new product with her team, during the official launch, done as a mixed-media event in San Francisco and Second Life, the physical location was so crowded that they had to project the session to the exteriors, where many more people were eagerly awaiting the news but unable to enter the room. Inside Second Life®, partnering with Metanomics, the session was viewed live by over 300 residents spread among many locations (I found it very amusing that Metanomics’ Dusan Writer was picked to talk “in the flesh” in San Francisco as the host of this event; then again, who better than Dusan to explain what business in Second Life means?). The video stream apparently peaked at 2,500 viewers or so at the same time (but will probably have many more downloads in the next few days). So, overall, the product launch might have been followed live by some 3,000 people.

This is no mean feat. Obviously there is still some way to go to beat Steve Jobs’ keynote speeches once or twice a year. But nevertheless I believe it was a huge success (Amanda Linden calls it the largest promotional event ever run by Linden Lab in their decade of existence) — it’s no mean feat to have a product launch with 3,000 users. In real life, on a “traditional” product presentation with a press conference, getting 3,000 people to attend is quite rare! It’s also true that huge countries like the US will attract more people — I’m sure that any product launch by, say, Microsoft, will probably feature a similar amount of viewers — but I’m more used to audiences of 30-300 (and the latter number for Fortune 500 product launches!) for a new product. Your experience might be different, but in any case, we’re contrasting the launch from a relatively small company to a big, huge launch by a Fortune 500 company, which is a bit unfair to Linden Lab :)

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Quo Vadis, Secunda Vita?

Arrr, whar is our captain gone?In the same day, two bits news were widespread across the SLogosphere: Philip “Linden” Rosedale is going to start another company and Eshi Otawara, a long-time resident and superb content creator, decided to leave Second Life® forever. All this just before the Burning Life festival started.

We usually expect the captain to be the last one to jump ship when things are not going well. But in this case, is Philip really leaving? Are things really that bad?

How can we then explain the latest press release from Linden Lab (from late September), where it shows a lot of statistics demonstrating how big Second Life actually has become?

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My new corporate blog

astral-flowerAfter some thinking about this, from now on, I have split my usual posting between my other blog (Gwyn’s Home) and the corporate blogs here at Beta Technologies.

When I started blogging about Second Life®, my original purpose was quite naive: create a place where starting residents (newbies!) could find some information about Second Life. It was supposed to be a sort of “guide” — but a guide written by someone who was actually also starting her first steps in Second Life! Each time I figured something out, I would immediately blog about it (well, I had far more free time for blogging, that’s the simple truth!).

Soon, however, I found out that there were far too many “beginners’ guides” out there (my personal blog still gets lots of queries for “tutorials” or “free scripts” or “clothing templates!”), and I should just turn to something else: discussing the implications of living and working in a virtual environment.

That did, indeed, capture my attention for the past five years.

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