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If you're running a business that has a presence in a virtual world, market research firm Gartner thinks you might want to make sure your employees' avatars aren't dressed like Lady Gaga at the VMAs.

"Companies with codes of conduct for other Web activities, such as blogging, should be able to extend those policies into virtual environments," a release Wednesday from Gartner announcing its new report "Avatars in the Enterprise: Six Guidelines to Enable Success" explained. "However, because 3-D environments add the visual dimension, they will need to make sure that their policies also cover dress codes."

That means your avatar might want to lose the sparkly pink torpedo bra, metallic leggings, and giant bat wings. When it's representing your company, that is.

The presence of businesses in virtual worlds like Second Life is nothing new--and has been much derided in recent years. But according to Gartner, it's still on the rise, particularly when it comes to training and virtual meetings. "Avatars are creeping into business environments and will have far reaching implications for enterprises, from policy to dress code, behavior, and computing platform requirements," the release explained. Gartner estimates that 70 percent of enterprises will be regulating the avatars of employees who use virtual worlds for business.

Two years ago, Gartner put out a study detailing the risks and pratfalls of doing business in virtual worlds, among them the difficulty of brand and reputation management. Now it's getting more specific: Gartner now says that employees ought to know how to operate their avatars properly, use the same degrees of discretion and professionalism that they do on social-networking sites, and even keep separate avatars for personal and professional use.

Virtual world Second Life has put in effect some new measures to keep adult content away from users who might not want to run into it. Or fly into it, as avatars might do.

Later this year, parent company Linden Lab will create a standalone "continent" for adult content, and members who don't purchase private "land" will be asked to migrate there if they wish to partake in adult-related activities. Second Life is an 18+ environment already, but stricter age verification policies will be put in place. You'll need a "verified" account, either through credit card information or through Linden Labs' filtering system, to get into the adult "continent."

Members will be asked to start flagging content as adults-only as part of a new content rating system, which will start to roll out in an update to the downloadable Second Life client that will be available next week.

"The people that are on our mainland and in our estate, if they are going to engage with adult content, are being asked to do that in the adult content area," said Cyn Skyberg, vice president of customer relations at Linden Lab. "Private land owners will be asked to tag their searches for adult-related listings so that it goes into the adult filter."

So what does this mean for Second Life, which was briefly a marketers' paradise before swifty falling from grace in the Silicon Valley pecking order? Well, it'll help make it a friendlier environment for some of the new "residents" whom Linden Lab hopes to woo. The company is profitable, due largely in part to the sheer volume of virtual goods and transactions made on the platform by loyal users, and Linden Lab sees corporate and academic institutions as an area for future growth. Keeping porn in its place could be good for P.R.

"A portion of this will be perceived as definitely being more corporate- and educator-friendly because you'll have more control over the things you're experiencing," Skyberg said.

With Metaplace, almost anyone can build their own custom virtual world. Its tools make it simple to script any object with various actions. And every object and world in Metaplace has its own URL.

(Credit: Metaplace)

Why play someone else's virtual world when you can build your own?

That's the major premise behind Metaplace, a new browser-based virtual-world platform from, among others, former Sony Online Entertainment chief creative officer Raph Koster.

Built to run inside the browser on any Internet-connected machine, Metaplace employs a simple, 2D, Flash-based graphics system that fronts for a fairly sophisticated set of content creation tools and what may one day be a complex open-ended economy built around user-created content.

In fact, because of the 2D and Flash nature of Metaplace, it's easy to miss that the platform offers users some of the easiest virtual-world building tools that have ever been made available. And while Metaplace has been in closed beta since October, it is expected to emerge into a public and open beta period sometime later this year. See below for an invite to the closed beta.

The company, which was formerly known as Areae, raised a $6.7 million funding round last October, led by Charles River Ventures. In total, it has raised $9.4 million.

Rising to the top
Metaplace has a little something for everyone. For the casual users, it has any number of user-created worlds to play, and there's a basic central Metaplace world that is an easy gathering place. Each can be rated, and the highest-rated rise to the top, allowing users to skip messing around with the system's chaff and instead concentrate on the wheat. But for those who are interested in creating their own virtual world, Metaplace offers a cornucopia of tools and choices that make it quick and easy to get a brand new world up and running.

Of course, as with any user-generated content system, the good creations are far outweighed by the bad. As Koster himself put it, "There are more than 25,000 Metaplace worlds, most of them are empty and most of them are crap."

But if it sounds like Koster is bashing his own system, he's not. Rather, he's touting how easy it is for anyone to start a virtual world that itself can be accessed by anyone on the Internet in mere seconds. Indeed, it's not an exaggeration to say that just about anyone could have a rudimentary Metaplace world up and running in less than five minutes.

Virtual Worlds Management, a company that provides research on the growth of online virtual worlds, said $594 million was invested in 63 virtual worlds during 2008. Gaia Online and PlayFish were two of the most prominent recipients of venture funding during the year. That said, investments in virtual worlds declined as the year wore on. In the first quarter of 2008, virtual worlds received $184 million in funding. By the fourth quarter of that year, investments dropped to $101 million. Virtual Worlds Management expects a further decline in funding in virtual worlds during 2009.

Fuzz.com, a social-networking site for musicians and music lovers, announced Wednesday that it's being forced to shut down, effective February 13. According to a blog post the company's founder placed on its site, Fuzz will close because of "increasing operating costs and flat revenue." On February 13, none of the site's accounts or content will be accessible.

Community presentation provider SlideShare has announced that its users can now embed YouTube videos into their Flash-based presentations. According to the company, its old policy of forcing users to include links to outside videos simply wasn't working, so allowing them to embed YouTube videos seemed appropriate. Although its software now works with YouTube, no other video services are supported.

Online video applications, platforms, advertising networks, and related services incurred $494.7 million in revenue in 2008, said AccuStream Media Research. That amount is nearly 87 percent greater than 2007 revenue figures. Even better for the online video market, the research firm believes video revenue will increase by 41 percent in 2009 and 38 percent in 2010. The amounts were based on reported revenue figures from video overlay applications, advertising platforms, CMS platforms, and other video-related services.

HomeAway, an online vacation rental marketplace, announced that it redesigned its hallmark site, VacationRentals.com, Wednesday. According to the company, the revamped page features enhanced property details and an interactive photo flip book to get a better view of prospective locations. To celebrate the launch, the site is offering a "Family Fun Giveaway" for vacationers who wish to book a trip to Florida. Through February 26, travelers will be automatically entered to win 80 prizes from the site, which range from $75 gas cards to a family four-pack of passes to Disney World and Kennedy Space Center.

Metaplace, a company that plans on letting users build a virtual world and use social networking conventions to allow groups to enjoy them, announced today that it raised $6.7 million of funding in a round that was led by Charles River Ventures and Crescendo Ventures, as well as independent investors, Marc Andreessen and Ben Horowitz.

Somewhat similar to Second Life, Metaplace creates an online virtual world for people across the globe to interact with. But unlike Second Life and There.com, Metaplace uses an open platform to allow users to create, build, and live in their own unique virtual world. The company claims that it wants its users to create a "network of worlds--from community to games to education to business" that will allow people to collaborate, socialize, and "conduct commerce" as they do in the real world.

Metaplace is currently in private beta and has only allowed a few thousand people to use the service. But in the coming weeks, it will open the beta to more users in the hope that it will grow into a service that brings together the virtues of both virtual worlds and social networks.

Whether or not Metaplace can thrive where Second Life and There.com couldn't remains to be seen. The company's idea to create a virtual world has been done before and so far, competitors simply haven't been able to capitalize on a relatively inactive user base. Regardless, Metaplace thinks it will be different.

Virtual Worlds Management, a company specializing in the virtual-world market, released figures showing that venture capital and media firms have invested more than $148.5 million in 12 virtual worlds during the third quarter of 2008. So far for the year, total capital investment is more than $493 million.

According to the company, most of the funding is going to developers who create environments that have "strong gameplay elements or ties to media brands." Investors are also targeting the youth market and have been looking for more youth-centered virtual worlds than ever before.

The bulk of the past quarter's funding went to MMO (massively multiplayer online) game publisher Trion, which raised $70 million recently in a round that was led by Act II Capital, as well as Time Warner and Peacock Equity.

But most of the attention is shifting away from conventional MMO environments and moving to the youth sector. Of the 12 virtual-world developers that secured funding during the third quarter, six specifically target children or young adults. In fact, Gaia Online, a virtual world for teens, secured $11 million in July, and Knowledge Adventure, which provides an interactive educational environment for children, was able to land $5 million in funding in August.

The idea that venture capitalists will be more frugal over the coming months than they've been in the past few years has been discussed quite a bit amid the current economic crisis. But considering the sheer value of money spent on in the third quarter alone, virtual worlds may be one place that start-ups can buck that trend.

Click here for ongoing coverage from CNET News, 'Tough times for tech'

ExitReality is the latest virtual world to come onto the scene and is launching out of private beta tonight. Its big bold feature is the capability to turn any site you're on into its own 3D world with interactive elements created from content found on the page. This includes photos, videos, and music files.

The service requires a small system plug-in that currently runs only on PCs. I was told no Mac version is planned, but may come into the picture if there's enough of a demand. Once the plug-in is installed, you just need to click a button in your browser and it will take you to the 3D version of that site. The tool will automatically scan any page you're on and make a "default" world where bits and pieces of content are pulled together and organized within a giant room. Site creators can put together their own creations, complete with a developer toolbox that lets people create some Second Life-esq environments using open-source 3D modeling standards.

In a demo earlier this month co-founder and CTO Danny Stefanic walked me through something that looked like the Ewok village from Star Wars. Unfortunately Webware.com did not look as lush, although my byline has never been bigger. Stefanic says site owners can put together their own worlds that would become destinations, or companions to their existing sites, and offer yet another place to monetize their content.

This is a more developed ExitReality page that includes many user created elements. The stock page that's generated on text sites is far less flashy.

(Credit: ExitReality )

To that end, the entire Exit Reality platform is tied to two important things: a social and ad network. Users can have their own Exit Reality specific profiles that come with them from site to site, and there's a built-in directory and search tool used to browse some of the best creations. The advertising side is a little more vanilla, with contextual ads that layer on top of your site's content. There are also special branded 3D elements such as a Carl's Jr. moving bull which was shown off to me in reference to a 2-year-old TV advertisement, which can be found when visiting the Carl's Jr. site in Exit Reality.

Ultimately my only beef with Exit Reality's approach is that it's not offering a whole lot more than something like Me.dium when it comes to the social side of browsing. Me.dium doesn't try to re-think what site creators have come up with and makes the discovery process no different from the experience everyone else on the Web is having. Exit Reality seems to be focused on the 3D attraction, which is certainly not a bad thing, but the experience you get coming to a default version of a site is just not up to snuff with the handful places that have been meticulously created to be immersive. It's a classic chicken and egg problem, with users bound to get bored of it unless there are plenty of interesting places to visit.

Another problem is that the 3D virtual world space is getting crowded fast. Last week at the TechCrunch50 conference we saw the launch of Hangout.net which looks a little more visually impressive and includes things like VoIP chat and a really neat physics engine that lets you throw things around with some level of realism. There's also the Home service coming to Playstation 3 owners in the next few months, alongside the other myriad online choices like Doppelganger, Kaneva, and There.com which also partially compete with gaming heavyweights like Second Life and World of Warcraft.

The one thing that's really going to keep people coming back is something different, be it the people there or the available activities once you're on a site. Whether the open-source creation tools (which I think are one of the strong points) are enough to make that happen is anyone's guess.

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Google's Lively is a Web-based project similar to Second Life. This shows a re-creation of Google headquarters, complete with the T. Rex skeleton.

Update 8:17 p.m. PDT: Google amended one Lively detail: the application for MySpace is under development but not yet ready. Also, I corrected a name misspelling.

Google on Tuesday plans to unveil an online 3D social arena called Lively, the Internet giant's take on Second Life. But Google wants it to be part of your first life.

Second Life requires users to download and install a separate "client" software package that taps into the online world. Lively also requires a download and installation--Windows only for now--but then people can use Internet Explorer or Firefox to enter the virtual world.

"It's integrated with the Internet. It's not an alternate destination," said Niniane Wang, Google's engineering manager for the project. "Our intention is to add to your existing life."

Integration with the ordinary Internet takes several forms. For one thing, you can pipe in content hosted elsewhere on the Internet, including photos or videos. For another, you can embed your Lively area into your blog or, using widgets Google has written, on Facebook Web pages now and MySpace pages later. And you can e-mail your friends a normal Web address to get them to join.

With Lively, you can set up you own online spaces--rooms, grassy meadows, desert islands, or, in the demo version I tried, simulated Silicon Valley office parks. You can change the clothing or form of your avatar (that's your online incarnation, for those of you who missed the Second Life hype). And of course you can chat, do backflips, shake hands, and give high-fives.

The idea is to bring a better social dimension to online interaction, Wang said--something more sophisticated for expressing oneself than an emoticon on an instant-messenger status line.

"We think there is a desire to socialize in this way," Wang said, suggesting that's why Second Life got so much attention when it blossomed in popularity a couple years ago. "We hope this product will help them do that."

Integration with the Internet is indeed a significant departure from the Internet, but much of the Lively sales pitch will sound--how to put this politely--familiar to those who've already read virtual worlds press releases from years past.

I had a number of burps and hiccups using Lively in my demo on a somewhat elderly but by no means ancient laptop, problems Wang said weren't widespread. When it's working correctly, it took a little while to master the controls for moving the perspective and my avatar around.

After that, the novelty wore off even more rapidly than with Second Life. I'm sure it would have been more exciting with somebody else to talk to than a mock-up of Google's T. Rex skeleton, and perhaps if it were a room that I designed myself.

Don't get me wrong. I remain a believer, overall, in this form of online interaction, however socially stunted it may feel compared with, say, a singles bar. I just think the technology has a ways to go. I found Second Life more immersive, but even so, even the relatively crude communications enabled by e-mail and instant messaging did more to revolutionize my online social interactions.

A few other differences from Second Life: Lively doesn't have money. It's designed to be easier to use, with a drag-and-drop interface. And it's not programmable, at least yet, so you can only select furniture, clothes, hairstyles, and such from the prefabricated catalog Google supplies.

Money and programmability are both items the company is seriously considering, though, Wang said. A Mac OS X client also is a high priority, she added.

Weblin is a service that allows people to have avatars that appear on the Web pages they visit and communicate with any other Weblin users who are visiting the same pages.

(Credit: Weblin)

If you're a social media addict but think that visiting regular Web sites is a lonely experience, you might want to take a look at Weblin.

Created by a German company, Weblin is designed to make the experience of surfing Web sites social--or make services like Facebook or MySpace.com more social. It does so by letting users create an avatar that they can then, effectively, take with them as they move around from site to site.

If they then find themselves on a site that is being visited at the same time by other Weblin users, then they can communicate with each other.

Weblin's main model is a small download, but it is also about to launch a light version that will require no downloads or plug-ins and will simply auto-assign users an avatar rather than them getting to choose their own.

(Credit: Weblin)

The main Weblin service is a small download that allows users to register and then create their own avatar. But next week, Weblin plans to launch a light version of the service that requires no download or plug-in and which assigns an avatar to everyone who uses it.

That means that users would have less control over the experience, but at the same time they'd be able to use Weblin without doing anything except use the Web. Additionally, the light version will not require registration. Rather, users will just have to enter a URL into a Weblin page.

Down the line, Weblin says, it hopes to make it possible to integrate Weblin with users' existing avatars from some virtual worlds.

For the time being, of course, Weblin's utility seems like it only comes from there being a critical mass of users and when users visit sites that are popular with others employing the service. But over time, if it grows large enough, it could provide a fun alternative to the traditional way of using Web sites.

On June 10, Geek Gestalt hits the highways for Road Trip 2008. I'll start in Orlando, Fla., and visit many of the South's most interesting destinations. Stay tuned, and be sure to keep up, both now and during the trip, with what I'm doing on Twitter.