CXO

Cheat Sheet: Second Life

Got a life? Why not get another...

Second Life? Love it! Cool weapons, blowing away bad guys...
Guess again. You're thinking of Half Life. Second Life is a very different kettle of virtual fish.

But I get to run around blowing away monsters, right?
Whoa there. Second Life doesn't really work like that. Think of it as a world where you can interact with other people, set up businesses. Except that you can fly, teleport around and look pretty much like anything you can think of.

It's probably the best known of the virtual worlds that are becoming popular but are distinct from classic gaming worlds. And its becoming very interesting to big business.

Second Life and big business

Click on the links below to see pictures of some of the real-world businesses that have set up in Second Life.

Adidas
Nissan
Sun Microsystems
Reebok
Penguin
American Apparel
Reuters
CNET Networks
PA Consulting
Yankee Stadium
Bartle Bogle Hegarty

Okay, so what do you do?
Users describe themselves as 'residents' rather than 'players'. Some just like to use Second Life as a place to hang out with friends, but others are using it as a new land where they can set up business. The idea is that Linden Lab (the developers of Second Life) provide the environment - the land - and make money from subscriptions and land sales. Residents can build what they want.

Very web 2.0.

Exactly - a big emphasis on user-generated content. According to Linden, businesses set up by residents include party and wedding planning, fashion design, architecture, XML coding and theme park development. And it says thousands of residents are making part or all of their real-life income from their Second Life businesses.

Residents retain intellectual property rights over everything they create in-world. If you create it, you own it.

So how do you buy things?

Second Life has its own virtual currency - Linden Dollars - which can be converted into US dollars and vice-versa. The exchange rate for this virtual currency tends to stay around 250 Linden Dollars to the US dollar.

The growth of these virtual currencies in various virtual worlds is of great interest to banks. As one industry watcher pointed out, there is more trade in some virtual currencies than in some real-world currencies.

So why all the interest now?

Big businesses are getting interested in virtual worlds like Second Life for a few reasons. (Click here to see how some of their corporate buildings look.)

Firstly it's building up a big population - around 1.3 million at the last count, with about half of those logging in in the previous two months. That's a pretty savvy consumer base to tuck into. Unsurprisingly this means that big brands are getting involved. Reuters, SonyBMG, Adidas and Reebok to name a few. And many of them are buying their own islands.

Islands?
Sure - if you want to build you really need to buy some land. So why not go the whole hog and buy and island? Small islands are priced at $1,250 for about 16 acres, with monthly land fees of $195 for maintenance. A large island will set you back $5,000.

What do they do with them?
It varies - some set up virtual shops to show off their real-world wares - others are using their virtual presence as a meeting place for staff and customers. Nissan has set up a giant vending machine where you can pick up a virtual car. Other islands have hotels and entertainment complexes on them. Reuters has built an Atrium where Second Lifers can catch up on real-world news.

So we're all going to live in a virtual world.
It's still early days for these virtual worlds, although there are some interesting experiments going on.

And the user base is still pretty low, especially when compared to some of the traditional gaming environments - World of Warcraft, by contrast, has seven million subscribers. Which means it can sometimes feel a little bit empty, although that should change.

A lot will depend on how the community develops - as with many user-generated models, much will depend on how creative the contributors are. Of course, there is the risk that the influence of big business could become too great, turning a land of opportunity into just another marketing tool.

After all, these web 2.0 crowds are nothing if not fickle and willing to move onto the next big thing.

About Steve Ranger

Steve Ranger is the UK editor of TechRepublic, and has been writing about the impact of technology on people, business and culture for more than a decade. Before joining TechRepublic he was the editor of silicon.com.

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