The UK's Edinburgh Interactive Festival, set for August 12-14, 2007 at the Royal College of Physicians, is focused on "expanding the creative culture of games." To that end, they're planning keynotes, debates, panel sessions and cross media industry discussions to examine gaming's impact on consumers and entertainment companies as well as traditional media.

Recently, the Festival's lineup has been expanded to include virtual worlds, with EVE Online creator Hilmar Petersson and Linden Lab's Jim Purbick joining the discussions. Purbick will participate in a 'Developing for Second Life' strand of panels on the 14th, while Petersson will head up ‘Exploring EVE Online’ on the 13th, and will also contribute to the ‘Virtual Societies’ discussion on the 14th.

In his welcome statement on the Festival's homepage, Chairman Chris Deering said, "For our delegates, partners and speakers, Edinburgh offers one thing in particular above all other industry events - a unique networking opportunity for those who are truly passionate about games. It also offers a stimulating and challenging two days of conference, debate and discussion that brings together people from all tiers of the worldwide games and interactive industries."

[Via MCV]

It's easy to gripe about Second Life, what with its recent loss of luster and backlash in the media. A recent article in Inc. did a comprehensive interview with Linden Labs CEO Philip Rosedale, and a blogger at Found Read synthesized the interview into a clever top five that highlights what Rosedale did to get Second Life funded and off the ground (top five from Found Read, Rosedale quotes from Inc.)

1. Rosedale recognized his big idea for Second Life early, AND that it was too early for the market. So he waited, as Rosedale explains: "This is a nonstarter right now because for this to be interesting it has to be sexy, it has to be fun, it has to be fast, it has to be within human response times. It has to be like a video game. And in the mid-‘90s you couldn’t do 3-D on a PC."

2. Rosedale recognized that he needed more training if he was to be successful with his Big Idea later on. "I needed some experience working with other people and learning how you get people to work together and work on a really big system. I figured I would get to see all that at Real [Networks where he worked before founding Linden Labs]. And I did."

3. Even with big-name backers, Rosedale heard ‘No’ a lot because not everyone accepted his vision. But he understood that they accepted him. So he kept going. "Second Life was just unfundable. It was just the dumbest idea ever. Mitch Kapor [the founder of Lotus Development] was the only person who got it. Mitch invested in 2001 after I had invested about a million dollars of my own money. I think some of the early angel investors were largely investing in me."

4. When he saw that word-of-mouth marketing wasn’t working, Rosedale bit the bullet and made lay-offs. "When we couldn’t grow it as quickly as it needed to, we had one round of layoffs. There were 31 of us and 11 of us left. That was in late 2003, when we pretty well thought we were dead."

5. Finally, he recognized that getting customer buy-in meant “letting go” of the development, and placing it in the hands of his users. The rest is history. "We recognized that there was a core of people who were really starting to want to build the content and invest in it and really value it. And we said, What you have in Second Life is real and it is yours. It doesn’t belong to us. We have no claim to it. Whatever you do with Second Life is your own intellectual property."

The entire Inc. piece is worth a read, and credit to Found Read for so aptly summarizing the salient bits!

[Via Metaversed]

Technology-focused research organization Yankee Group has released a report titled "Wither Second Life?" Examining the impact of the slowing rate of growth for Linden Labs' virtual world, which has waned since its peak in October 2006. The report also found that user engagement with Second Life has "leveled off" at 12 minutes per month, contrasting those figures with the steady increases seen by sites like MySpace and Facebook. As to the latter, Yankee Group pegs the average time spent per user at 186 minutes per month, a 24 percent increase over the last six months.

"The hype surrounding Second Life doesn’t match its actual marketplace impact," says the report, attributing the stagnation to Second Life's "PC-centric approach in an increasingly mobile world."

“All is not lost with virtual worlds,” said Christopher Collins, senior analyst in Yankee Group’s Consumer Research group. “However, for virtual worlds and metaverses to achieve greater potential in the marketplace and grow beyond early adopters, the experience must be untethered to meet the needs of the 'Anywhere Consumer.' Companies that provide remote access—through mobile devices or other means—to their web experience will have a greater impact than PC-centric companies.”

According to Linden Lab's official blog, Second Life's physics engine is at last getting a tune-up, after a couple years' unfulfilled promises.

Tony Walsh's Clickable Culture blog has plenty of excellent detail on the change - Second Life has been running on the Havok 1 physics engine since 2003, and it will now be updated to run on the more recent Havok 4 engine, improving the performance and capabilities of the virtual world.

The Havok 4-powered Second Life is currently in public beta. From Linden Lab's blog:

"This project is all about improving sim stability and reliability, reducing lag in the physics engine, and fixing some bugs that could not be fixed under Havok1. In other words, there are no new features in the Havok4 project, despite the fact that there has been significant work done 'under the hood'".

Among some of the improvements Linden hopes to see from the engine upgrade are reduced simulator crashes, less lag, stacked objects that behave dynamically (reacting when supporting objects are removed) and improved management of how in-world people and objects react when they collide.

There are still some bugs, according to the blog, but once the physics engine completes beta testing and rolls out across the grid, Linden will presumably begin actual work on Havok 4 features. the heels of frequent snarking about Second Life being "over the hill," it's expected that this facelift will help it stay current.

Once in a while, business smash successes come out of Second Life that reinvigorate the arguments those who support the Linden world levy against the critics. Metaversed has the interesting story of RDZ Animations, who's sold 2000 units of their product at $3000 Linden dollars* apiece.

What's interesting is what their product is -- when you realize it's a "couples animator" called Rendezvous. Since we are talking Second Life here, it should be clarified that Rendezvous is not a sexual animation tool -- it's simply an animation tool that allows couples spending time together to actually hold hands, stroll together, perform cuddly resting animations and things like that.

Companionship in virtual worlds is a thought-provoking idea. There's quite a great deal of talk lately about personalizing one's virtual life, and how online worlds enable people to project their interests and self-expression into an avatar. It only makes sense, then, that that would extend to the way avatars relate with one another. There are already some strides being made in this area -- what comes to mind is our experiences in VSide and Entropia Universe, both of which let you choose the way your character stands, thereby controlling the attitude you project. And while most online worlds and MMOs provide means to initiate physical gestures of various types back and forth, what Rendezvous focuses on is the behavior of spending time together.

Ever tried to follow or walk with another character in a virtual world? Just as Metaversed says, this can be a stilted, awkward experience, rife with stiff collisions, meandering paths and companions getting stuck behind. The fact that RDZ Animations is so successful with a product that attempts to make even mundane companionship in virtual worlds so lifelike shows how important that is to some people -- after all, aren't virtual worlds social experiences? And it's also a good story of how Second Life businesses can be successful by knowing their market.

[Via Metaversed]

[*CORRECTION: The original article stated the price of the technology at $3000 USD -- it's $3000 LINDEN dollars, or as one reader said, "about $10"! Which makes quite a bit of difference, but the interesting developments for social interactions in virtual worlds still stand!]

IBM and Linden Lab have announced that they will collaborate jointly on new technologies and methods based on open standards for virtual worlds. Together, the companies say they'll be exploring the the interoperability of virtual world platforms and technologies in a series of industry-wide efforts aimed at expanding the possibilities in online worlds and the 3D Web.

IBM and Linden Lab plan to work together on a series of issues relating to integrating virtual worlds with the current Web, driving security-rich transactions of virtual goods and services, working on interoperability among worlds, and building stability and service into virtual world platforms. All of these initiatives, the companies say, will help make virtual worlds more accessible for enterprise.

The companies released a list of specific projects, outlining the initiatives on which they'll collaborate: "Universal" Avatars, which aims to allow users to transport the same avatar and all its attributes among multiple worlds; creating requirements for standards-based software to facilitate secure asset transactions in online worlds, and improving platform stability and ease of use to accelerate user adoption and enable high-volume business use.

Other initiatives include the formation of open standards for interoperability with the current Web, including open source development of interoperable formats and protocols. In other words, IBM and Linden aim to develop standards to allow users to travel persistently among virtual worlds, the way we navigate from one web page to another on the Internet today.

Colin Parris, vice president of Digital Convergence at IBM said, "As the 3D Internet becomes more integrated with the current Web, we see users demanding more from these environments and desiring virtual worlds that are fit for business. IBM and Linden Lab's working together can help accelerate the use and further development of common standards and tools that will contribute to this new environment."

Added Linden Lab's vice president of Business Affairs Ginsu Yoon, "We have built the Second Life Grid as part of the evolution of the Internet. Linden and IBM shares a vision that interoperability is key to the continued expansion of the 3D Internet, and that this tighter integration will benefit the entire industry. Our open source development of interoperable formats and protocols will accelerate the growth and adoption of all virtual worlds."

At New World Notes, Wagner James Au reports that a new Facebook application, Second Life Link, connects Facebook profiles to the user's Second Life avatar by mapping it using the avatar key, and allows the avatar to be displayed in the Facebook profile. It also lets people see whether their Facebook friends are in Second Life at any given time, and to teleport to favorite locations directly.

It's unsurprising that a popular social networking tool would finally get its own means to connect to Second Life. The app, called Second Life Link and created by Fire Preibisch and Jared Mitchell, is still in beta.

[Via New World Notes]

At the 2007 Virtual Worlds Forum Europe, Vodafone's David Erixon unveiled the company's new "Inside Out" technology, a utility that lets users call or text their Second Life friends' real-world mobile phones. Tech Digest says Ericsson's claiming 10,000 have signed on to the tech so far.

But Tech Digest raises another good point -- why would users use Second Life to make phone calls or send text messages when it would be simpler to do that from one's own phone? A commenter points out that the service will let users text Second Life friends without knowing their phone numbers, a way for Second Life friends to keep access to one another on the go while keeping actual phone numbers private -- a sort of "virtual phone number?"

Raph Koster recently asked whether virtual worlds are mainstreaming. There's an article about online worlds in the New York Post (with the tacky headline "Unreality Bytes") -- does that answer the question?

According to the article, some entrepreneurs are suing a Queens man with IP counterfeiting in Second Life. Manifold have been the discussions about how much of an issue intellectual property rights will become in virtual worlds, and this is doubtless the first of many small fires that will have to be doused with increasing frequency.

The defendant in the suit, Thomas "Rase Kenzo" Simon, allegedly stole various designs from the online stores of the six plaintiffs -- furniture and sex plugins, mostly -- and sold them in Second Life. One has to wonder how the court judge will react when he's hearing a case brought by "Munchflower Zaius" and "Stroker Serpentine."

Silly names or not, it's Simon's reported reaction to the suit that raises eyebrows. "They can say whatever they want; it's only a video game," quotes the Post. "I didn't know you could sue anyone over it."

[Via New York Post]

Crime in virtual worlds is ever an emerging topic, and an interesting article in the UK List talked to some key players in persistent worlds, including EVE Online's Hilmar Pétursson and Linden Lab's Marcel Kay about the fine line they're now having to tread between policing user behavior and protecting its virtual society and economy. When a user breaks the rules -- counterfeiting items, buying black-market goods or gold -- it's a clear-cut case, but what if user crime is committed within the concept of the world's rules?

In the article, Pétursson told the List about how EVE handled that gray area:

Space piracy is an intrinsic part of Eve Online. But a recent coup and a series of high level assassinations by the Guiding Hand Social Club rocked the world of Eve, with literally billions of in game credits changing hands or being destroyed. Several users petitioned for CCP to effectively hit ‘reset’, but they stuck by their guns. "It was a simple decision but not necessarily an easy one as there were hundreds of people hurt by this action," says Pétursson. "By not doing anything, in this case, it opened people’s eyes to the fact they were really living in a virtual world where anything could happen and it’s left up to the citizens of that world to deal with the negatives and positives."

Interesting story -- crime and economic disruptions, along with the idea of financial power in the hands of a few, are concepts that are part of the real world, so it follows that they will happen in virtual spaces too, as they evolve. It begs the question -- are virtual worlds a game, where companies should preserve their userbase's fun factor at the expense of realism? Or do people want them to behave like a lifelike society?

[Via The List]

Recently, IBM and Linden Lab announced a joint effort to develop new technologies and methods aimed at developing open standards for virtual worlds. The end goal? Interoperability and expanded possibilities for the web and online worlds, via a set of standards that would enable, among other things, universal avatars, objects that are portable from one world to the next, and universal protocols for transactions.

Amid a hail of marijuana leaves, boxes and a falling house thanks to griefers, Zero Linden held a conference in Second Life, covered extensively by the Second Life News Network, to discuss the collaboration and to clarify standards, announcing the formation of the new Architecture Working Group, or AWG, which invites residents to collaborate on the work at the group's wiki, which the group plans to update continually.

Explained Zero, “Interoperability means making a Second Life that can have regions run outside of Linden Lab with separate implementations and it means having agent domains that are run outside of Linden Lab with separate implementations. As far as scalability, the grid itself must scale to the number of agents, regions and online that I’ve outlined," he said.

He also clarified that IBM would not be providing any tech support or restructuring to Second Life's code, assuring residents that there would be no "swooping in of IBM engineers at the Linden Lab HQs."

"The AWG is on the one hand a much less ambitious effort, and on the other, the biggest thing that could happen in SL. It is less ambitious in that it is tackling only one view of what will be an Internet-wide Metaverse: take SL and make it work with 60 million regions, most run by non-LL entities. On the other hand, it is a much more concrete objective than other groups may be contemplating at this time,” Zero stated.

[Via Second Life News Network]

An extensive writeup in MIT Technology review takes a look at the upgraded search function in Second Life. As it points out, the importance of virtual goods in particular is what makes the ability to narrow results by relevance and in finer detail so essential -- with Second Life's much-touted IP marketplace, where anyone can craft and sell goods, it's a boon to both consumers and sellers that it's apparently now easier to find things.

It's also a sign, perhaps, that the online goods market is expanding in Second Life. Look at it this way -- there are now so many shops, locations, items and events that the search tool needed refinement to aid users in zeroing in on what they want, Google-style. Jeska Dwizalski told the Review that she hopes the specificity in search will also support socialization in Second Life, by helping users to find other people with more specific traits in common, like hobbies or other info.

With some controversy lately about the relatively uncontrolled "wild West" of Second Life, the ability to filter searches to avoid mature content might also be valuable to users and therefore to the platform, which as it expands may suffer a bit of identity crisis as it aims to be many things to many people. From the article:

The algorithm behind the new Second Life search tool will resemble Google's: found objects will be ranked according to how well the data used to describe them match the search terms entered, how close multiple words are to each other, and how popular the objects seem to be, based on the frequency of references to their locations. Like the existing search tool, the new one will allow people to select whether or not they want to include mature content in their searches. The current release, Dzwigalski says, lets Second Life subscribers decide which of their elements they want the search engine to index, so that they will have a chance to determine their desired level of privacy. "The new search tool allows people to search more things and better describe them," she says.

Still, as the article explains, this is not a cure-all for the virtual worlds search idea, which is still far from a perfect science. Michael Rowe, manager of 3-D internet and intraverse research at IBM comments in the article, "Search is important, but I personally don't know of any answer in that space yet. I would say search [in virtual worlds] is going to be pretty exciting as it matures, since you're not only looking for a link: you're looking for a thing within a context of space and time."

[Via MIT Technology Review]

The O'Reilly Radar got hold of some presentation slides from NASA's Daniel Laughlin, intended to have been part of the Digital Library Federation's Fall Forum (Laughlin didn't make it to the event). But some interesting ideas are revealed on NASA's vision for virtual worlds -- and their existing use of them for education, outreach and immersive experiences.

NASA, which started two Second Life islands earlier this year, uses it regularly for its online collaboration internally -- it refers to it, and other 3D online spaces as "immersive synthetic environments," or ISEs. A video entitled "NASA's CoLab Second Life Mission" shows an intriguing use of online worlds, a vision that imagines those on Earth able to converse and share perspectives with astronauts while they are on their space mission:

Laughlin tells the Radar's Peter Brantley:

When NASA returns to the moon in 2020, the people of Earth will be able to share that experience. Not just through the passive medium of television like the last time we went to the moon, but through the virtual experience of a persistent immersive synthetic environment. Kids are starting to use PISE at a very early age already. Nickelodeon and Disney each run their own online worlds. The children who play in those worlds are going to expect more from both their work and play as adult than 2D interactivity. They will expect 3D the same way people today expect cable television and those in the 1970s expected color television.

Virtual worlds and space travel? Futuristic visions collide!
[Via O'Reilly Radar]

A number of news sites and presences have popped up around virtual worlds -- not virtual versions of real-world news bureaus, but news bureaus established to report on happenings within the online world itself. Now news giant CNN has launched a Second Life hub, as it explains:

There, CNN will look to those most familiar with the virtual world -- the Second Life residents themselves -- to determine what constitutes news "in-world."

Developer Linden Labs opened Second Life to the public in 2003. According to its Web site, Second Life is inhabited by millions of "residents" from around the globe. However, traffic at any given time hovers around the 40,000 users. Photo See the many views of Second Life. »

Just as CNN asks its real-life audience to submit I-Reports -- user-generated content submitted from cell phones, computers, cameras and other equipment for broadcast and online reports -- the network is encouraging residents of Second Life to share their own "SL I-Reports" about events occurring within the virtual world.

"The thing we most hope to gain by having a CNN presence in Second Life is to learn about virtual worlds and understand what news is most interesting and valuable to their residents," said Susan Grant, executive vice president of CNN News Services.

The Second Life hub will apparently work just like its real-world one, where SL users can submit video and tips on what they find newsworthy in-world.

[Via CNN.com]

A thorough new piece over at ZDNet Australia is examining some myths and facts about business in Second Life, which it calls "poster child and whipping boy for the virtual world movement." Among the points raised -- business use of Second Life primarily focuses education and simulation, not for virtual brand outposts and stores, and privacy is a possibility:

What you can do with that is use a series of estate tools to give you full control over that island and who can access it. You can deny specific people or groups, or just make it completely private. Sun and IBM both have public and private presences. There's quite a number of companies that do have a private presence and don't have a public presence at all.

"The other thing they can do as well in controlling who registers in their private area. The registration API allows you to be able to register people for Second Life yourself, and you can send them to their starting location so when they first log in they go to the right place."

Other, trickier topics includes accessibility -- what's being done to improve broadband accesssibility, and do Second Life avatars have a bigger carbon footprint than real people?

"We conduct a lot of company meetings in Second Life. With us being able to hold virtual meetings, our carbon footprint is a lot lower. Every Friday, we have an internal staff meeting and about 60 to 80 people show up -- people from all over the globe."

OK, it's time to ask about virtual terrorism and, more specifically, how to defend your business against flying penises thrown by virtual vandalas. (An interview held in the Second Life presence of ZDNet Australia sister site CNET News.com earlier this year was disrupted by just such an outbreak of airborne genitalia.)

As you can imagine, there's a brief moment of uncomfortable silence when I raise this issue, but Collins eventually takes the bait. "I think again it comes down to the first point we discussed. With your estate tools you have the ability to say who can create things at your location, so you need to turn that off. It's an educational process."

[Examining Second Life Myths For Business - ZDNet]

Cory Ondrejka, who led development for Linden Lab, the home of the Second Life virtual world, left Tuesday, according to a statement from the company.

"As it grows, the needs of our company are changing, and the role of CTO, or technical lead, has also evolved," said Linden Lab founder and CEO Philip Rosedale, in a statement. "Therefore, Cory and I are in agreement that our paths, at this point in time at least, lie in different directions." Rosedale said Ondrejka left "to pursue new professional challenges outside the company."

The Linden Lab statement doesn't say whether Ondrejka quit or was fired. Rosedale added that he wanted to "publicly thank Cory for his tremendous contribution to the company and to Second Life."

Massively, a virtual worlds and multiplayer gaming blog, reported that it had obtained copies of internal e-mails from Ondrejka and Rosedale announcing Ondrejka's departure.. According to the e-mail attributed to Rosedale, "Cory and I have differences in how we think Linden should be run, differences that in the past few months have become irreconcilable. These are tensions that were more manageable when we were smaller, and there have been times that they have helped us do great work together. But now, as we change and grow as a company, I feel that we need a different set of strengths in engineering leadership. I strongly believe that this is the right decision, although not without pain, for both LL and Cory."

Ondrejka was the fourth person to join Linden Lab, according to the Massively comments attributed to Rosedale.

"It has been an absolute thrill working with all of you on Second Life," according to the e-mail attributed to Ondrejka. "When Philip looked across a rickety card table in November of 2000 and told me that we would do more than build a great product, we needed to build a great company, too, I knew it would be a wild ride."

He added, "I continue to believe in both Second Life and Linden Lab, but Philip and my visions for the future of Linden Lab are divergent enough that he decided to lead in his own way."

One of Ondrejka's accomplishments was creating the Linden Scripting Language, the programming language used by Second Life content creators to control the behavior of objects in Second Life. Ondrejka liked to tell stories about how he created the language in a rush. "[N]ote to self, next time spend more than one night designing language," Ondrejka quips in the e-mail attributed to him on Massively.

Around 11.3 million Second Life accounts have been created since the virtual world went online four years ago, with 474,000 logins in the past seven days.

As one of the technology heads of Linden Lab, Ondrejka was in the focus of controversy about Second Life. The service is notoriously buggy and unstable, prone to frequent crashes, slowdowns, and outages. Although the service has been growing more stable recently, it still has problems. Linden Lab took Second Life down Tuesday morning to add data center capacity; that outage, scheduled to run from 7 a.m. to 11 a.m. Pacific time, instead extended past 2 p.m.

Linden Lab is working to improve Second Life stability and performance, upgrading the physics engine to Havok 4 and changing scripting to the Microsoft (NSDQ: MSFT) Mono platform.

Ondrejka could not be reached for comment Tuesday.

[This article was originally posted by Worlds in Motion sister site Information Week.]

Linden Lab is apparently now offering Second Life users account statements of their monthly finances in-world. Second Lifers can now view details from all of their transactions -- from dollars in to dollars out -- as far back as possible. The statements are in U.S. dollars and let you view transactions one month at a time via PDF. This is probably of particular use to Second Life business owners who need the info for taxes.

Official demographics for Second Life have just come out on the Second Life blog, showing an active user base of 538,400. The average in-world time for these users is 45 hours a month, which is pretty formidable.

However, over at New World Notes, Wagner James Au reminds us that that active users number, while less than that in August, was slightly more than that 538,400 number in July. He points to recent trends of stagnation even in spite of increased Second Life promotion, like the two TV shows (CSI: NY and The Office) that featured Second Life in the month of October, and states that Second Life has reached a plateau phase.

Au continues:

"The main reasons for this stagnation, of course, are obvious: constant system failures, a confusing user interface, and disorienting first-time visitor experience. Improvements to the first hurdle will surely grow the populace, though I'm beginning to wonder how much the latter two can really be addressed: OnRez, despite its many strengths, coupled to a highly polished introductory experience, did little to improve overall retention rates. It may be that the conceptual barrier will always remain constant at 10%, and the remaining 9 and 10 who try a user-created 3D world without imposed guidelines and goals are fundamentally, intransigently incapable of embracing it. That may be."

[Via New World Notes]

U.S. employment attorney and HR consultant Dave Elchoness has launched a "virtual reality workplace" company called VRWorkplace. The company has a Boulder, CO facility, but operates out of Second Life, leasing, designing and constructing spaces for business use on the Second Life grid. VRWorkplace is also offering consulting services for businesses on virtual worlds strategies.

The company's Second Life facility currently includes office and meeting space, an amphitheater, coffee house, and, of all things, an amusement park -- everyone needs break time, one supposes.

Elchoness says he founded the company after running global IT outsourcing and noticing the challenges. He commented, "Geographically separated teams and client bases are increasingly the norm. Until now, we've used air travel, telephone, and other technologies to help us with distance. But there's nothing like virtual worlds technology to bring people together. Having a virtual workplace reduces air travel and improves workplace collaboration because virtual worlds offer one-of-a-kind shared experiences. With VRWorkplace, coworkers 10,000 physical miles apart can meet in a virtual 'hallway,' conference room or coffee shop, any time they like. It's what we call 'remote togetherness.'"

Spiegel Online recently talked to Philip Rosedale, and asked him a few tougher questions than the Linden Lab founder seems usually to field from the media. Rosedale was asked, essentially, if the "party is over," following what can be perceived as a bit of a bubble popping for Second Life in the media. He says that's the natural cycle of new media, but admits it's a "rollercoaster."

Rosedale highlights Second Life's uses for business and academic collaboration, but stops short of admitting, when prompted, that marketing in second life is "a flop."

One highlight, pertaining to business models:

SPIEGEL ONLINE: One thing you haven't managed yet is to make people pay to use Second Life on a large scale. Online games like "World of Warcraft" that offer mission and reward schemes make huge amounts of money through subscription fees. Do you need to reconsider your model?

Rosedale: Our strategy is that other people need to build that on top of us, and they are doing that. We have to make sure the platform offers the right kind of features to make that stuff easy -- and that is a challenge for us. It is similar to Facebook, where they've created an API to allow people to build little social applications. But we are not going to make Second Life into a game to improve its retention.

Finally, Rosedale says that issues of performance and accessibility are currently the main focus: "Making it crash less on everybody's computers is our number one mission right now."

[Spiegel Online | Interview With Rosedale]

When Linden Lab announced that Philip Rosedale would be stepping down as CEO, they painted an optimistic parting -- the founding visionary now stepping aside to make room for someone with more business experience. Rumors have abounded that Linden may even be set for an IPO.

Worlds in Motion spoke to Multiverse founder Corey Bridges on the heels of the announcement, and though he notes he has no inside information, Bridges sees the Rosedale departure somewhat differently. "Certainly Second Life has, in many ways, plateaued in some of their more important metrics and they're still not revealing a lot of the really key data on user behavior," he told us.

Added Bridges, "I think the fact that they had to push Cory out and then Philip is being excused from the CEO spot... I think that's because the investors have got their eye on their investment and are making hard choices that investors generally do. It's a very common thing for founding staff to be pushed out of the way when things get rocky."

Moreover, Bridges feels the idea of a Linden Lab IPO might be a paper tiger: "They can't go public," he states. "I think they would have difficulty if they tried to go public, because they would have to disclose a lot of the real numbers. They have a huge abandonment rate."

In other words, in Bridges' opinion, Rosedale's resignation is "an acknowledgment that [Second Life] is not suitable for mainstream users and corporate customers -- neither the culture within Second Life, nor the tech underpinning it, is suitable for either."

Bridges also reflected with us on the progression of the Second Life juggernaut. "On the subject of Philip himself, he's a creative, charismatic guy who has done a lot of good for the virtual worlds industry -- as sort of nascent as the virtual worlds industry is," he said.

Continues Bridges, "I think with Second Life, he and Cory Ondrejka built something that got a lot of attention. It didn't ever quite go mainstream, but certainly it got a lot of companies -- big consumer brands, enterprise companies, to sort of examine this new phenomenon of virtual worlds, and got them to dip their toe in the water, which has been great. To some degree, I guess -- to mix water metaphors -- 'the rising tide lifts all boats,' and that's been true for the past couple years."

"That turned a corner last year, however, as the sort of completely wild, inappropriate expectations got way too far past what that particular world could actually deliver," notes Bridges. "What a lot of these big companies have found is that yeah, this is a useful new medium, or at least a method to engage with folks. But then, after they got that experience, they said, 'OK, what we really need is to build a virtual space where we have more control, where there are no flying penises, where our brand is not underneath somebody else's brand.'"

Bridges says Second Life was never built to be a virtual worlds platform -- notably, Multiverse provides one such platform in The Multiverse Network for online worlds. He says that what he sees as a new understanding on the part of companies working in virtual spaces benefits companies like his who now realize that "the industry is bigger than a single destination."

"I do honestly sincerely think we all owe Philip a thank you for bringing attention to the industry. Now it's just time for the real technology to step in," Bridges says.

Linden Lab and IBM have announced that they're teaming up to run Second Life on servers inside IBM's firewall, for IBM internal projects. The two companies plan to pilot the service to allow other companies to run Second Life inside their firewalls by year's end, and make the service generally available later on.

Using the service being tested by IBM, its users will be able to log in to the private server behind IBM's firewall, and move back and forth between that and the public Second Life grid, taking their avatars and possessions with them.

IBM will use the service for conferences, special events, and meetings.

"This is really about satisfying a market demand," said Ginsu Yoon, Linden Lab VP for business affairs. "There are enterprises that can be very comfortable with a hosted service, and there are customers who really want to have things inside their infrastructure." Linden Lab wants to be able to serve both groups.

The IBM announcement comes at a tough time for Second Life. The service saw explosive signup and growth rates in late 2006 and early 2007, but growth stalled later in the year. The number of dedicated users -- people who spend significant amounts of time in-world -- has been flat since late last year, at about a half-million users. Overall, users have created 13.1 million Second Life accounts since the service launched four years ago.

Big companies flocked to Second Life for marketing last year, but since then many companies, including American Apparel, Starwood Hotels, and Pontiac, have left the service (although some, like Starwood, said they always planned only a limited-time engagement). Other companies, like IBM, Cisco Systems, and Playboy, continue to operate in Second Life. And the service has a thriving culture of small businesses that operate only in Second Life.

Among the problems driving users away: Second Life is unstable, difficult to use, and users need to be running relatively powerful desktop computers. Philip Rosedale, co-founder of the company, said last month he's stepping aside as CEO, and the company is searching for a new CEO who can bring veteran management skills.

IBM is using virtual worlds technologies from Linden Lab and Activeworlds to offer "rehearsals," or training exercises, to its services team, said Jim Spohrer, director of service research for IBM Almaden Research Center.

IBM simulates project management and customer interaction in virtual worlds, he said.

Rehearsal services in virtual worlds provide the benefits of of face-to-face rehearsals and role-playing, while saving time and travel costs, Spohrer said. Also, virtual worlds are flexible in ways that reality isn't. "You can experiment with a lot of alternatives and designs," Spohrer said. "Also, as you start developing these rehearsal services, you can start reusing the components from one service to another."

[The preceding article by Mitch Wagner first appeared in Worlds in Motion's fellow United Business Media publication, Information Week.]

Research at Stanford University's Virtual Human Interaction Lab (VHIL) has found that even 90 seconds spent chatting and interactive with avatars is enough to elicit behavioral changes offline, according to an article from newsmagazine Time. Said lab head and assistant professor of communication Jeremy Bailenson: "When we cloak ourselves in avatars, it subtly alters the manner in which we behave. It's about self-perception and self-confidence."

With the aid of VHIL's $24,000 helmet which allows users to immerse themselves in virtual worlds, Bailenson and his Ph.D. students have been studying how how virtual experiences bleed into reality. In one experiment, volunteers were randomly assigned to look at attractive and unattractive avatars -- attractiveness being rated in a separate survey conducted beforehand -- for 90 seconds before they were asked to interact with other avatars. Subjects who were assigned "good-looking" avatars tended to display more confidence and extrovert traits, whereas the opposite was true for subjects with unattractive avatars.

In another experiment studying avatar interactions effects on real-world health, volunteers were randomly split into groups which watched avatars that looked like them running on treadmills, avatar counterparts just "lounging around," and avatars who did not look like the volunteers but were running on treadmills. The next day, participants who watched similar-looking avatars running on treadmills had themselves exercised an hour more in the intervening 24-hour period than volunteers in the other two groups.

Stanford is currently conducting a study on using older avatars to encourage users to start saving money for the future. Said Bailenson, "The most stunning part is how subtle the manipulations are and how difficult they are to detect, but how much it affects real life later on."

Second Life developer Linden Lab intends to launch a beta for Second Life instant messaging (SLim) client through its First Look viewer, according to a report from Second Life news site SLNN.

Speaking at a recent presentation, Linden Lab's vice president of Platform and Technology Development Joe Miller explained SLim: "[It's] a very thin client that is designed for you to stay in both voice and text contact with your friends list. If you want to participate in a meeting but can’t actually run the SL app to do it, you’ll be able to do that with our thin voice communication client. It will be in First Look in a couple of weeks."

Users will be able to install the instant messaging client on even older machines that cannot run Second Life or on computers that cannot prohibited from accessing the virtual world due to firewalls.

Miller also revealed other upcoming features currently under development, such as the ability for avatars to receive and answer outside phone calls within Second Life: “This will work two ways: you’ll be able to sign up for an access number that will give people who are outside of SL (perhaps on a cell phone) the ability to reach you in-world."

He continued: "The other capability is the ability to associate a standard telephone number – PSTN number – with a group, and that number can be used by a number of folks to join a group conversation for the purpose of meeting from outside of SL as well.”

In addition, he added that an opt-in voice mail feature is in the works, which enables people to leave voice mail messages for users if they are not in-world. Users will be able to set it so that they can receive the voice message via e-mail, as well.

Second Life developer Linden Lab has announced that Tom Hale is the company's new Chief Product Officer.

Hale most recently served as Senior Vice President and General Manager of the Knowledge Worker Business Unit at Adobe Systems, and is to report directly to Linden Lab's CEO Mark Kingdon in his position responsible for "driving the product strategy and business for Second Life."

Prior to Adobe, Hale was an Entrepreneur-In-Residence at Redpoint Ventures, and at Adobe, Hale drove the strategy for businesses including Adobe Acrobat, Adobe Connect and the Flash Media Server after the acquisition of Macromedia. Hale also holds a bachelors degree from Harvard University.

“Tom brings deep experience at every stage of the product lifecycle – from creating, launching and marketing great products to building large businesses around them,” said Mark Kingdon, CEO, Linden Lab. “Second Life is made up of an unusually complex array of products, and few executives have the range required to craft and execute a product strategy for such a rich, vibrant and diverse experience. Tom does. He will play a pivotal role in taking Second Life to the next level and will be a great partner for me.”