'Second Life' gets first look at new hotel chain

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For Linden Lab, the Aloft news came as a bit of a surprise. But Philip Rosedale, Linden's CEO, said that's precisely the point of handing over the "Second Life" content-creation reins to its users.

"Because of the promise that SL holds for people as just generally a place for human exploration for design and commerce and expression, there are a lot more people who can contribute to it at the level of engineering and design than could ever work for us," Rosedale said. "It's less common these days that I know about them until I read the press releases, and that's good."

"It's one thing to go to a Web site and look at some pictures of a design, but its another thing to be able to walk into a space, immerse yourself in the space, and then to walk into it with a friend and have a debate and talk about what works and what doesn't work."

--Giff Constable, VP,
Electric Sheep

Of course, "Second Life" is not the only virtual world with a strong economy. Others, like "EverQuest," "Ultima Online" and "World of Warcraft" have hundreds of thousands, or millions, of players buying and selling clothing, weapons, vehicles and the like, and it's been estimated that the total market for virtual goods is as high as $880 million a year.

One question that's come up is whether these items are taxable. Certainly, players are legally required to report profits on the sale of such goods, though few do. But a more interesting question--one that has yet to be officially answered--is whether taxes can be levied on unsold goods traded between players, which clearly have real monetary value.

And all that activity--social, financial and otherwise--has outsiders eager to get in on the action.

Real-world companies such as Starwood, Coca-Cola and Wells Fargo are just some of the businesses that have set up shop in "Second Life." American Apparel has gotten into the act, becoming the first retail chain to go virtual, with an online outlet opening last June.

In the last week, Text 100, a public relations agency that ranked ninth last year among the top 50 tech consultancies in PR Week Magazine, joined the growing array of "Second Life" businesses.

And in July, Major League Baseball stepped to the "Second Life" plate, with an event on the virtual Baseball Island tied to its All-Star game. Second Lifers had the opportunity to catch this year's home-run derby as it was simulated in the lush, green grass of the fantasy stadium. Live television coverage of the real-life event was presented on digital Jumbotrons around the perimeter of the field. Virtual fans ate hot dogs and cheered on the bobble-headed avatars representing each of the eight contestants.

The growing interest in turn has resulted in a blossoming business for third-party design firms like The Electric Sheep and a competitor, Millions of Us. Such designers can earn hefty real-world fees for their commissions. Among other things, they deal with the scripting tools required to create complex "Second Life" artifacts, which are notoriously difficult to use.