Newsmaker: Virtual magnate talks China, censorship

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What kind of growth do you have, percentage-wise, month to month?
Graef: We grow 10 percent to 20 percent per month, at least. Probably it is even more.

Is the growth tied pretty closely to Second Life growth, or would you say it's independent?
Graef: It used to be tied to Second Life growth, but our reliance on that virtual world is decreasing. We are at the stage now that the failure of Second Life would no longer mean the failure of our business. Even in Second Life we completely reinvent our business model every few months to keep up with rapid change. There are some similarities and many differences between what we do in Second Life and on other platforms. But what is the same across all platforms are people and people skills. We cannot transfer sims to other worlds, but minds we can.

Do you feel there's room for more Anshe Chung-scale businesses?
Graef: There is room for more businesses of Anshe Chung scale, but maybe not of the same business model. The economy could support multiple huge resident-run businesses of this size if each pursued some new and innovative business model. And don't overlook the number and size of the more widely spread content businesses in Second Life. I predict we see several content millionaires by the end of 2007.

I predict we see several content millionaires by the end of 2007.

However, I think many things will follow trends that you see in the music, film and software industries: as the population grows you will have a small elite that become content stars and terribly rich multimillionaires. But for the average person, it will become harder and harder because competition increases. Second Life used to be a village economy and now it has become cosmopolitan--a global, big economy.

Can you say what you think are five other lucrative Second Life markets that will stay so for another year or so?
Graef: The answer to this question can probably be found by researching the market for complex, high-quality standard content in Second Life. Very cool new applications that involve much optimization, programming and complexity and that everybody will want to buy one copy of. It's hard to be more specific. Finding the right application and niche is already half of the success. But one trend is clear: it will likely be more software and less art.

How many (land) sims that you own were purchased before the November 15 land price hike, and what do you plan to do about pricing once they are all sold?
Graef: I think before November 15, we had roughly 300 sims and we have currently no plan to change prices there. We also have more sims that we ordered before the price hike but that have yet have to be delivered and that we also plan to make available at our current pricing. Obviously, when all these sims sell out and we must expand with sims at the higher prices, we will need to use a different pricing model for them. But I think we have supply until February 2007.

You were a teacher. Did you have other previous business experience?
Graef: My experience most relevant to building a business in Second Life came from two sources: One is my experience in other virtual worlds as a nation leader and a role-play business person. The second source obviously is (my husband) Guni, who is very smart with all things business and technology. 

More Newsmakers

[Len Bullard]

Top Marks

Top marks for the topics of this interview. CNet finally hits an event of real importance in the real-time 3D market genre of virtual reality: the emergence of a smart business management class for the artists. She gets it.

That has always been the missing part of the 3D culture for the last fifteen years: a middle man management culture that understands that technologies come and go; it is talent and time that can't be gotten back if lost. Education and the care and feeding of the artists are more important than the technology itself. That will improve the current unfathomable imbalance in the market where the technologists and VCs take an unreasonable amount of the profits while promoting an ethic of 'you content people need to do this for the joy of sharing'. When Joi Ito, Mark Cuban and Tim O'Reilly start leaving expensives cars in front of Starbucks unlocked with the keys in them, I'll believe they really believes that, but until then, this gal and her husband are the ones to watch as the real shapers of the new content economies.

Way to go, Ailin!

[alek_nedic]

Starbucks unlocked

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