• On MovieTome: See the TRAILER for TERMINATOR 4!

February 19, 2007 3:00 PM PST

A winning business plan for 'Second Life'

  • Print

(continued from previous page)

The second-place finisher, a team of three from the Seattle area called Metaverse Technology, has created a suite of communications and collaboration tools intended to give enterprise users a way to use Second Life for business meetings and other important gatherings.

Jacob Sullivan, a Metaverse co-founder and an electrical engineer, said that his team would provide clients with tools along the lines of PowerPoint, interactive whiteboards and other presentation tools that could be used in Second Life.

The team imagines that businesses as well as educators would find the most use from the tools, but individual users might also want to buy pieces of the suite.

The third-place finalist was a team of three from Turkey that created a system for distributing music throughout Second Life in something of an iTunes model.

The idea, said team member Ozgur Alaz, a trend scouter and ad planner from Istanbul, is to provide owners of Second Life venues--clubs, stores, theaters and the like--with jukeboxes through which visitors could play digital music that anyone listening could then buy.

The business model for the idea, said Alaz, is to share revenue with the venue hosts as an incentive to place the jukeboxes in their locations. The team said it would try to find partners among the major recording labels to gain access to their catalogs of music. Songs would cost roughly the same as a song from the iTunes Music Store.

The fourth-place finalist was the Italian team of architect Laura Cassara and journalist Mario Gerosa.

The two have created a concept for a search engine to allow the virtual world's users to more easily locate the kinds of places, stores, clubs and other things that interest them.

The idea is based on the reality that the built-in Second Life search functionality is fairly rudimentary and has little or no contextual utility. Instead, it searches purely on keywords.

But Gerosa and Cassara have come up with a system that would allow users to find things based on their preferences and on quality.

That means that as users discover new objects and places in Second Life, they would be able to rate them and in the process create a "quality atlas."

The result would be something akin to Amazon.com's recommendation engine: as users find things, the engine would suggest other places or objects in Second Life or even, potentially, outside the virtual world.

Wu said she thinks the system would make a potentially profitable business but is not as well-developed or unique as that of Market Truths.

"Unless you're Linden Lab or you have experience doing search," Wu said, "you probably don't have a very defensible strategy if others enter the market."

Wu added that significant competition will inevitably emerge in the Second Life search market in the near future.

For Goldstein, the four teams represented the idea that Second Life can and will be a useful medium for those looking for new ways to build businesses and make money. And as a result, he said, the future of Second Life as an entrepreneurial environment is rosy.

"I think the competition is a great idea," said Goldstein, "and I think it's further validation for what's going on in Second Life, which is a platform to enable creativity and entrepreneurship."

Previous page
Page 1 | 2

See more CNET content tagged:
Second Life, business plan, focus group, market research, virtual worlds

Add a Comment (Log in or register) 24 comments
Metaverse Technology placed second!
by gusanocomemuerto February 19, 2007 5:44 PM PST
This article is inaccurate. The winner of the contest was indeed Market Truth, followed by Metaverse Technology, creator of the business tool suite, which placed second. Metaverse Technology was followed by the media player team. The search engine team came in fourth, received an honorable mention, but did not win a prize.
Reply to this comment
Metaverse Technology placed second!
by gusanocomemuerto February 19, 2007 5:44 PM PST
This article is inaccurate. The winner of the contest was indeed Market Truth, followed by Metaverse Technology, creator of the business tool suite, which placed second. Metaverse Technology was followed by the media player team. The search engine team came in fourth, received an honorable mention, but did not win a prize.
Reply to this comment
Second life
by Lindy01 February 19, 2007 6:27 PM PST
= get a life.

I can kind of see wasting hours on games...as a way to get away from it all...especially when the weather is bad. But to come home from work...and work again but only with bad graphics....and to pay for it monthly....NO THANKS.
Reply to this comment
Second life
by Lindy01 February 19, 2007 6:27 PM PST
= get a life.

I can kind of see wasting hours on games...as a way to get away from it all...especially when the weather is bad. But to come home from work...and work again but only with bad graphics....and to pay for it monthly....NO THANKS.
Reply to this comment
Second Life = Second Scam
by avfolk--2008 February 19, 2007 7:10 PM PST
Guess 'second life' is a second chance for the scammers that
missed the first internet boom -- this time combining the worst
measures of globalism, marketing hype, and gaming in one nifty
package. I sat through a long ugly demo of this great new
marketing ploy by a serious faced gent from GSD&M in Austin
Texas recently. As his PC bogged to a craw, the 'server' crashed,
and he was reduced to alternately explaning and aopologizing
how Second Life would revolutionize people's lives.... I
remembered PT Barnum's sage observation...

There's a sucker born every minute.

For Second Life's business plan, they're counting on it.
Reply to this comment
Second Life = Second Scam
by avfolk--2008 February 19, 2007 7:10 PM PST
Guess 'second life' is a second chance for the scammers that
missed the first internet boom -- this time combining the worst
measures of globalism, marketing hype, and gaming in one nifty
package. I sat through a long ugly demo of this great new
marketing ploy by a serious faced gent from GSD&M in Austin
Texas recently. As his PC bogged to a craw, the 'server' crashed,
and he was reduced to alternately explaning and aopologizing
how Second Life would revolutionize people's lives.... I
remembered PT Barnum's sage observation...

There's a sucker born every minute.

For Second Life's business plan, they're counting on it.
Reply to this comment
Disappointed
by Prokofy Neva February 19, 2007 8:23 PM PST
I'm disappointed in the outcome of this contest. Frankly, the others who came in second or third sound so much more interesting and sound like they'd do a lot more to develop the world of SL itself. I'd love to have a jukebox on my land venues that people could buy songs and play them. I hope this business will still try to get off the ground in SL.

I find this statement vapid:

"a contest judge and partner at Catamount Ventures, an early investor in Second Life publisher Linden Lab. "Another thing we considered in this contest is the effect on Second Life and its community...What (Market Truths is) going to be doing is working with big companies and helping immerse them in Second Life, and that's a great for getting more people involved and educated about Second Life.""

I don't see how "the community" is helped, i.e. the bulk of those actually using, living, working in SL. It sounds merely like a glorified focus group method, taken right out of first life.

It works from the outside in, i.e. "helping Big Companies immerse themselves" and not from the inside out, developing the world and making it more navigable, coherent, understandable, and useable.

I can't help wondering if a sort of cohort of focus group goers and survey filler-outers will develop who will be like camp chair sitters.

Once they have all these market surveys based on 36 part-time Wal-Mart clerks who happen to be able to sit on SL all day before the second shift, what will they have? 36 Wal-Mart clerks who like to turn tricks and shop in SL. Then what? Those same RL companies who wish to sell to them can do so in RL without all the bother.

The company that had the idea for improving the search sounds more useful if they get people figuring out how to shop and rate better, it could be a kind of consumer index. I'm not sure it would work at first given the gamed, vindictive climate of SL, but in time with enough participants, it could.
Reply to this comment
good business vs interesting products
by gusanocomemuerto February 19, 2007 9:21 PM PST
Well, if I might disagree a bit; the premise of Second Life is that the community as it exists now is just the first adopter tip of the general user iceberg. If the current Second Life population is all there is going to be, there isn't going to be much profit in it for businesses. The bulk of those actually using, living, and working in SL are not anyone's ultimate target market. So trying to perfect the platform for the first adopters at the expense of serving the more conservative and cautious is a huge mistake. This may sound like a betrayal, but it's a fact; none of the companies in this competition will be profitable if Second Life does not expand massively, which will drive demand for all sorts of products, interesting and otherwise.

I'd also note that this was a business plan competition, not an interesting product competition. There are lots of interesting products that will never make anyone any money. If you put a jukebox on your land, and tried to sell songs . . . how many people would buy them? Where is your content coming from, and how much are you paying to play it? Solving the content ownership problem- and I have no idea whether the jokebox team solved it or not- isn't "interesting," but it's the difference between whether the plan works or not. That doesn't get exposed in articles like this, because it's boring. But it's crucial. It's impossible to judge whether the judging was good or not based on product descriptions in a news article.

For example, while a marketing focus group might not sound as interesting as other products, the fact is that marketing is the first wave of business operating in SL, and it makes business sense to attack the part of the market that has money and is spending it, now. What's wrong with a glorified focus group method, from a business perspective? They build a slightly better mouse trap. They don't have to rent out space in a mall and pester people with clipboards. They've got paying customers and a more affordable solution. Sounds pretty damn viable to me.

However, I agree that certainly the world needs to be developed, be improved, become more coherent, understandeable, and usable. But that's a job for Linden Lab, not the competitors in this plan, who must assume the world is going to get fixed up if anything is ever going to be profitable there. If the world remains as Prokofy Neva describes it, SL will not survive, nor will any of these companies, and the existing community will have to take their quirky avatars somewhere else. If, on the other hand, it gets out of its adolescent phase into adulthood, it is going to run like the internet boom did. The interesting products with the weak business models may get VC money that is looking for some angle on SL, but they won't make profits. The ones who survive will be the ones with the solid business models. It is doing a service to everyone, including anyone considering investing their own money in this technology, to promote profitability. I think this competition did that.
View reply
Disappointed
by Prokofy Neva February 19, 2007 8:23 PM PST
I'm disappointed in the outcome of this contest. Frankly, the others who came in second or third sound so much more interesting and sound like they'd do a lot more to develop the world of SL itself. I'd love to have a jukebox on my land venues that people could buy songs and play them. I hope this business will still try to get off the ground in SL.

I find this statement vapid:

"a contest judge and partner at Catamount Ventures, an early investor in Second Life publisher Linden Lab. "Another thing we considered in this contest is the effect on Second Life and its community...What (Market Truths is) going to be doing is working with big companies and helping immerse them in Second Life, and that's a great for getting more people involved and educated about Second Life.""

I don't see how "the community" is helped, i.e. the bulk of those actually using, living, working in SL. It sounds merely like a glorified focus group method, taken right out of first life.

It works from the outside in, i.e. "helping Big Companies immerse themselves" and not from the inside out, developing the world and making it more navigable, coherent, understandable, and useable.

I can't help wondering if a sort of cohort of focus group goers and survey filler-outers will develop who will be like camp chair sitters.

Once they have all these market surveys based on 36 part-time Wal-Mart clerks who happen to be able to sit on SL all day before the second shift, what will they have? 36 Wal-Mart clerks who like to turn tricks and shop in SL. Then what? Those same RL companies who wish to sell to them can do so in RL without all the bother.

The company that had the idea for improving the search sounds more useful if they get people figuring out how to shop and rate better, it could be a kind of consumer index. I'm not sure it would work at first given the gamed, vindictive climate of SL, but in time with enough participants, it could.
Reply to this comment
good business vs interesting products
by gusanocomemuerto February 19, 2007 9:21 PM PST
Well, if I might disagree a bit; the premise of Second Life is that the community as it exists now is just the first adopter tip of the general user iceberg. If the current Second Life population is all there is going to be, there isn't going to be much profit in it for businesses. The bulk of those actually using, living, and working in SL are not anyone's ultimate target market. So trying to perfect the platform for the first adopters at the expense of serving the more conservative and cautious is a huge mistake. This may sound like a betrayal, but it's a fact; none of the companies in this competition will be profitable if Second Life does not expand massively, which will drive demand for all sorts of products, interesting and otherwise.

I'd also note that this was a business plan competition, not an interesting product competition. There are lots of interesting products that will never make anyone any money. If you put a jukebox on your land, and tried to sell songs . . . how many people would buy them? Where is your content coming from, and how much are you paying to play it? Solving the content ownership problem- and I have no idea whether the jokebox team solved it or not- isn't "interesting," but it's the difference between whether the plan works or not. That doesn't get exposed in articles like this, because it's boring. But it's crucial. It's impossible to judge whether the judging was good or not based on product descriptions in a news article.

For example, while a marketing focus group might not sound as interesting as other products, the fact is that marketing is the first wave of business operating in SL, and it makes business sense to attack the part of the market that has money and is spending it, now. What's wrong with a glorified focus group method, from a business perspective? They build a slightly better mouse trap. They don't have to rent out space in a mall and pester people with clipboards. They've got paying customers and a more affordable solution. Sounds pretty damn viable to me.

However, I agree that certainly the world needs to be developed, be improved, become more coherent, understandeable, and usable. But that's a job for Linden Lab, not the competitors in this plan, who must assume the world is going to get fixed up if anything is ever going to be profitable there. If the world remains as Prokofy Neva describes it, SL will not survive, nor will any of these companies, and the existing community will have to take their quirky avatars somewhere else. If, on the other hand, it gets out of its adolescent phase into adulthood, it is going to run like the internet boom did. The interesting products with the weak business models may get VC money that is looking for some angle on SL, but they won't make profits. The ones who survive will be the ones with the solid business models. It is doing a service to everyone, including anyone considering investing their own money in this technology, to promote profitability. I think this competition did that.
View reply
Secound life to escape REAL life
by bradyme February 20, 2007 6:30 AM PST
AKKK sick to my stomach. Marketing! GO AWAY!!!! SPOILERS!
Reply to this comment
Secound life to escape REAL life
by bradyme February 20, 2007 6:30 AM PST
AKKK sick to my stomach. Marketing! GO AWAY!!!! SPOILERS!
Reply to this comment
Yet another SL article
by goalcam February 20, 2007 9:25 AM PST
I don't know why CNET seems so obsessed with Second Life and Anshe Chung. We're constantly seeing articles about one or the other up on the top of the front, and I really have a hard time believing that the majority of CNET News readers give a damn about the latest happenings in SL.
Reply to this comment
Seriously, why the constant Second Life hype?
by Mark Greene February 20, 2007 10:35 AM PST
I hear about it ONLY on cnet.

Is it REALLY that popular?

Or, is there some financial transaction involved here?
Yet another SL article
by goalcam February 20, 2007 9:25 AM PST
I don't know why CNET seems so obsessed with Second Life and Anshe Chung. We're constantly seeing articles about one or the other up on the top of the front, and I really have a hard time believing that the majority of CNET News readers give a damn about the latest happenings in SL.
Reply to this comment
Seriously, why the constant Second Life hype?
by Mark Greene February 20, 2007 10:35 AM PST
I hear about it ONLY on cnet.

Is it REALLY that popular?

Or, is there some financial transaction involved here?
Second Life Sells out its Customer Database
by Vegaman_Dan February 20, 2007 9:45 AM PST
I read this article and they are saying they will be working with focus groups to target their marketing / advertising to Second Life customers based upon their Real Life player information. Can spam be that far behind? Will we start seeing in game advertisements more than user created content? How long before we have popup ads in the browser itself?

I call this just another commercial nail in SL's coffin. It was a good realm to mess around in until they started courting corporate customers and ignoring the end user.

And yes, I'm still out $130,000 Lindens due to a system error. Since it's virtual, they say they aren't liable for any of it so all my money I had in the game is gone. Poof. Sorry. Now if I was a corporate customer and that had happened, I don't think they would use the same argument. Imagine Linden Labs telling Sony that- sorry, a game glitch lost all your inventory and online funds. Please start over from scratch- no backups or help from Linden Labs will be made available.

Somehow I don't think that would happen. To end users? Sure, we don't count for anything. Corporate customers? Those are the ones LL wants, not you.
Reply to this comment
Second Life Sells out its Customer Database
by Vegaman_Dan February 20, 2007 9:45 AM PST
I read this article and they are saying they will be working with focus groups to target their marketing / advertising to Second Life customers based upon their Real Life player information. Can spam be that far behind? Will we start seeing in game advertisements more than user created content? How long before we have popup ads in the browser itself?

I call this just another commercial nail in SL's coffin. It was a good realm to mess around in until they started courting corporate customers and ignoring the end user.

And yes, I'm still out $130,000 Lindens due to a system error. Since it's virtual, they say they aren't liable for any of it so all my money I had in the game is gone. Poof. Sorry. Now if I was a corporate customer and that had happened, I don't think they would use the same argument. Imagine Linden Labs telling Sony that- sorry, a game glitch lost all your inventory and online funds. Please start over from scratch- no backups or help from Linden Labs will be made available.

Somehow I don't think that would happen. To end users? Sure, we don't count for anything. Corporate customers? Those are the ones LL wants, not you.
Reply to this comment
PLEASE!!! Enough SL articles already. Nobody cares.
by fcekuahd February 20, 2007 11:57 AM PST
eom
Reply to this comment
PLEASE!!! Enough SL articles already. Nobody cares.
by fcekuahd February 20, 2007 11:57 AM PST
eom
Reply to this comment
Running out of news cnet?
by kieranmullen February 20, 2007 11:23 PM PST
Second life is in the news every other week, however they have yet to make real money or prove online vendors can really make money setting up virtual shops.

KieranMullen
Reply to this comment
Running out of news cnet?
by kieranmullen February 20, 2007 11:23 PM PST
Second life is in the news every other week, however they have yet to make real money or prove online vendors can really make money setting up virtual shops.

KieranMullen
Reply to this comment
 See all 24 Comments >>
advertisement
Click Here

Latest tech news headlines

RSS Feeds

Add headlines from CNET News to your homepage or feedreader.

More feeds available in our RSS feed index.

Markets

Market news, charts, SEC filings, and more

Related quotes

Dow Jones Industrials (0.00%) 0.00 8,273.58
S&P 500 (0.00%) 0.00 850.75
NASDAQ (0.00%) 0.00 1,482.05
CNET TECH (0.00%) 0.00 1,030.48
  Symbol Lookup
advertisement

Inside CNET News

Scroll Left Scroll Right