Jun 232008

For those folk who fancy a trip down to Monash University Law Chambers on Wednesday 25 June and who want to see where ‘Underbelly’ meets Social Virtual Worlds and Online Games well we have just the seminar for you. My opening talk’s title “The Sex, the Violence and the Dirty Money: The Truth about Social Virtual Worlds” constructed several months ago now seems a little OTT, wonders how he will live up to the promise…oh yes just cite every mainstream ‘heritage media’ article about the evils of online games and social virtual worlds and voila. Of course I will be talking about some of the benefits too. I might also use this lovely video I picked up from a side exhibition in Seoul last week from APEC Education Foundation Series which points out the evils of the internet (sorry, safe use of) – this particular one entitled ‘Copyright Infringement’ is ‘so swank’…btw I will be putting up my Seoul talk at the trilateral Broadband Summit in a day or so.

Seminar (PDF available from here)
Wednesday 25 June 2008, 4 – 6.30 pm
Monash Centre for Regulatory Studies, Monash University Law Chambers
472 Bourke Street Melbourne
Key Speakers
Gary Hayes, Director LAMP @ AFTRS and Head of Virtual World Development, TPF
Dan Hunter, New York Law School, Melbourne University Law
Melissa deZwart, Senior Lecturer, Monash Law
David Lindsay, Senior Lecturer, Monash Law

Businesses, and communities of users are increasingly operating in virtual worlds, such as Second Life. But doing business in virtual worlds raises many complex, novel legal issues. Already, potentially landmark cases have come before US courts. This seminar features well-known experts and legal academics in this rapidly-emerging area. It will be an indispensable introduction to virtual worlds, as well as an overview and analysis of significant legal issues.

4 pm Welcome
4.10 pm The Sex, the Violence and the Dirty Money: The Truth about Social Virtual Worlds
Gary Hayes
4.40 pm Property, Intellectual Property and Virtual Worlds: What Do Virtual Worlds Tell Us About Property?
Dan Hunter
5.10 pm Beyond the Terms of Service: Legal Issues in Regulating Virtual Worlds
Melissa deZwart
5.40 pm Copyright Protection of Buildings and Artistic Works in Virtual Worlds: Comparative Legal Analysis
David Lindsay
6.10 pm Questions & Discussion
6.30 pm Refreshments

Speaker profiles
Gary Hayes is the Director of the Australian Laboratory for Advanced Media Production
(LAMP), which is run through the Australian Film, TV and Radio School (AFTRS), based in Sydney. LAMP is rapidly emerging as Australia’s preeminent media R&D and production lab. Through AFTRS, he runs workshops in multi-user virtual environments (MUVE), exploring the potential of shared social online virtual spaces for collaborative production, creativity and education. Gary is also Head of Virtual Worlds with the UK-based Project Factory. In this capacity, he has produced and built both the Telstra and ABC Second Life presences, and is currently building and devising other commercial and game-like services for virtual worlds. From 1995-2004, as a Senior Producer and Development Manager for the BBC in London, Gary led the BBC’s development of the internet, interactive TV and emerging platforms. As a published music producer, composer and performer, he has had over 200 works performed live and on TV, film and radio. Gary has been an International Interactive Emmy juror for the past two years.

Dan Hunter is an expert in cyberspace and internet law, and artificial intelligence and cognitive science models of law. He holds a chair in law at the University of Melbourne, and will join the New York Law School faculty permanently in mid-2008. Dan regularly publishes on issues dealing with the intersection of computers and the law, including papers dealing with the regulation of virtual worlds and high technology aspects of intellectual property. He was one of the first scholars to examine the social significance of virtual worlds, co-founded the scholarly blog Terra Nova (terranova.blogs.com), and ran the 2006 State of Play/Terra Nova Conference at New York Law School, and the 2007 State of Play Conference in Singapore. Dan holds a PhD from the University of Cambridge on the nature of legal reasoning. He was a tenured faculty member at the Wharton School, University of Pennsylvania, from 2000-2007, where he continues to teach as an adjunct faculty member. Prior to joining Wharton he taught on the law faculty at Cambridge University in

Melissa deZwart is a Senior Lecturer and Director of Teaching in the Faculty of Law at Monash University, where she teaches Cyberlaw, Law of the Internet, Intellectual Property and the Internet, and Introduction to Legal Reasoning. Melissa is an expert in cyberlaw, e-commerce law, information technology law, technology contracts and copyright law, and is widely published in these areas. She is the co-ordinator of a Monash Arts/Law grant researching the law and regulation of virtual worlds, and has been instrumental in establishing the Monash presence in Second Life. In 2008, Melissa will introduce the graduate subject, Law of Virtual Worlds. Melissa has a PhD from Monash on the intersection of copyright and contract in the digital environment. Prior to joining the law faculty, she was the Legal Manager at CSIRO.

David Lindsay is a Senior Lecturer in the Faculty of Law at Monash University teaching Intellectual Property Law, Copyright, Law of the Internet, Communications Law & Regulation and Trusts. He is the author of many articles and reports in the areas of intellectual property law, internet law, communications law and privacy law, and a wellknown speaker on these areas. David is a contributing author for Copyright and Designs (Butterworths, Sydney, 1996-) and the author of International Domain Name Law: ICANN and the UDRP (Hart Publishing, Oxford, 2007).

May 062007

NOTE: Based on my sticky post ‘The Brand Owners Guide to Joining the Metaverse”.

As promised a rough transcript of my keynote talk to CeBit last week based on my experience of actually building some Second Life sims, talking to those who use them and creating branded environments that have more usage than any others inworld, so far. There will be a video and/or podcast at some point from CeBit TV and linked from our Project Factory main site but for now lots of ‘nice’ words and this YouTube video I uploaded…

Hello I’m Gary Hayes and thank you for inviting me here to speak at CeBit this afternoon. I hope that by the end of this very brief introduction to virtual worlds, and particularly Second Life, you will be more aware of the major changes that are happening to what we used to call ‘the web’. Virtual worlds are a new disruptive and transformative medium and one that is becoming a significant force alongside our traditional media experiences. But it is still early days. It is the silent movie era, a bit like TV in the late 40s or the web itself in the early 90s – but already virtual worlds are a place where the audience stops being the audience, who become and create their own stories. For those without any exposure to virtual worlds this talk will be a beginners guide and for those who already know something or a good deal about these 3D shared spaces there will perhaps be one or two surprises, Hopefully we will go inworld too if the connectivity gods are with us.

So what do we mean by virtual worlds. In very simple terms they are a bit like MySpace meets the Local Pub meets YouTube meets The Shopping Mall meets Flickr meets World of Warcraft – ok not that simple. We are really talking about non-game based, online spaces where people create new identities and become a part of a larger resident community. There are often no rules, only those set by the inhabitants themselves, this makes it a particular challenge for brands as we will see later (they don’t like to be told how to live!). Many of you would have heard of Second Life, with nearly 6 million registrations at the moment, but there are many others. Habbo is interesting as a simple isometric service for teens now with 76 million registrations and nearly 8 million regular users. Playstation 3 is about to launch ‘home’, a sort of virtual apartment suburbia connected to other PS3 players and EA games has just teamed up with Endemol to deliver what we sometimes call Mixed Reality (cross-over programmes between TV and virtual worlds). There are quite a few others such as there.com, Kaneva and many new kids growing up on the block such as multiverse, croquet or outback online. MTV Networks used the there.com engine to do some extremely interesting TV/Virtual World cross-over services like Laguna Beach, which I sadly won’t have time to talk about. Common to all of them are people using these shared worlds to interact with others around the globe, for hours at a time.

So what are the forces at work here, what is driving this change? Well I suppose there are two key ones. The first is the shift from humans wanting the internet to be more than the rather lonely and non-real time experience to one where as a “participant” they can have real time, collaborative and far richer immersive social interactions. Note I am careful to not call them, the audience – be aware that any media that still thinks of the residents of virtual worlds as audiences are doomed to failure. The second force at work here is to do with residents in worlds wanting to be far more active, creationist and imaginative. They are creating their own experiences versus passively consuming media, such as on TV or via YouTube for example. You have all heard of web 2.0 (blogs, wikis, flickr – the sharing web) well I like to think of virtual worlds as ‘part’ of web 3.0, the real time, co-creative web. It is still about sharing but in a far more natural setting – this is a space where you can walk up to someone and ask -Where can I buy some shoes and will you come shopping with me” versus typing the word shoes into some abstract search engine on the web and spending hours looking at flat pictures. A question I often get asked is, -Is this hype and something that will go away?” Absolutely not. I am old enough to have lived through the dawning of the web and early failed 3D world services, this is totally a part of that on-going evolution and this will now be here for good. The real question that should be asked, and perhaps the focus of my talk, is how are brands and professionals attempting to integrate into these spaces, will they create a virtual paradise or another dotcom burst?

The thing that’s common with all virtual worlds is the real time shared experience, and that should be the key to anyone thinking of setting up a branded space inside these worlds. Participants want to be just that, participants and co-creators. In a world like Second Life (now four times the size of San Francisco around 210 square miles) and where 99% of the content is made by the inhabitants, for a brand to simply plonk some souless buildings, or theme park, or even well displayed real world product falls way short of what the residents actually want. The message that we are getting from the inhabitants is for businesses to -play with me, don’t sell at me.” This is very important. These worlds are extremely ‘sticky’ and inhabitants invest a great deal of themselves in co-creating the environment and the numbers speak for themselves. In second life at the moment there are over 200,000 unique entrants per day spending an average of 4 hours in world – that’s nearly 1 million user hours, and with a population growing at around 30% per month you can see why many other virtual worlds will be popping up in the next few months and years to meet this demand.

Lets have a look at a very short video (which can also be seen on the Project Factory stand throughout the day) showing some of the social activities, the thing that is really driving demand in these environments.

SELF CUT VIDEO -a montage of a variety of experiences” (in background starting up SL if connectivity for demo)

So a brief taste of what goes on inworld, very experiential activities such as dancing, sport, ‘inworld tourism’, education, collaborative building and so on. These are often missed or ignored by the mainstream press. With my other hat on as Director of the Laboratory for Advanced Media Production at AFTRS I am also active in the educational areas in Second Life where collaborative, experiential teaching is growing into a powerful tool – a very vibrant and active community. But who are the real inhabitants? In Second Life it is far from being just young males. The average age is 33 and women constitute around 43% of the total. Interestingly the time spent gender wise is reversed. Of the total time spent by all participants, females account for 60%. Looking at the international split around 31% are from the USA, 48% Europe and 21% rest of the world. Europe is by far the fastest growing area now with growing numbers of English, French, Dutch and Germans so the servers (currently in San Fran and Texas are in the wrong place!). Back to the age question, one fascinating statistic I gleaned last week from Phil Rosedale, the CEO of the makers of Second Life, was that those over 60 years old spend 30% more time in Second Life than those aged 30. Lets try to pop into world now, hopefully, and have a quick two minute wander.

DEMO INWORLD. This space is called the Pond. The one that the Project Factory produced and built for Telstra BigPond. I am not sure who is around but regardless lets have a look at how Second Life works. That is me, the one with the wings and here I am at the main welcome area. Lets go for a short walk, if we meet anyone we may have a chat. It is important to have a welcoming or totally unique environment, look the ripples on the lake, palms, things to do, boating, dancing and of course a popular pastime, flying – (impro a bit here depending on audience reactions). I would like you to notice too how the advertising and brand presence is not ‘in your face’, more about that later. CLOSE DEMO.

Second life is not just about sex, money and griefing. Griefing, by the way, is a term used to describe irritating behaviour, which actually is extremely easy to control. Most of the stories you hear about ‘virtual terrorism’ is really a toxic combination of unprepared companies inworld and the media that likes to find ‘an angle’, just like the real world then. The Project Factory and other Second Life developers have many easy to implement strategies to reduce this to a minimum.

Onto money and opportunities for brands. For the moment it is about getting in there early (first mover advantage), learning about what works and collaborating with the existing resident communities. This both shows that you are ahead of the curve but also open to really having a direct relationship with your customers and most importantly learning from them. It is a way to reach and understand your existing clients and prepare for what will be a mass audience in a very short time. A recent inworld survey by CB News in partnership with Repères asked over 1000 Second Life residents their opinion of real world brands and there were some surprisingly results. 66% believe that the presence of RL brands has a positive impact on SL and 45% of respondents even want more brands because they enhance and give more credibility to Second Life, a realism and make SL more interesting, by increasing the number of residents. But at the moment we are not talking about mass audiences. Successful brand presences, and two of the recent Project Factory builds in Second Life are in the top five, may have anywhere between 30-60 thousand unique visitors per quarter. These will seem like small numbers to some brand owners and advertisers, but, and here is where it gets very exciting, the inhabitants are spending anything between 15 minutes and 6 hours per visit to your brand! That figure is unheard of in almost any other media even more significant and important for those concerned with reach is that those residents are the most active in the blogosphere, and millions of impressions are generated outside these worlds – they tell of their lengthy experiences in the other social networks.

Shopping in virtual worlds is actually fun for the inhabitants and comes up as one of the most popular pastimes. The ability to browse products alongside your trusted friends is more akin to the mall than eBay of course so this is a real opportunity for those who want to attempt to make in or out of world sales. The more progressive companies are allowing consumers to co-design product and even order real world product from within the environment. A simple example. Very similar experiences to real life are being created in these worlds such the shared ‘media’ experience – listening to music, watching movies with others is pretty cool, you can chat and play-around with your fiends alongside the latest film. Dominos pizza realised this early and now allow you to order your ‘real’ pizza while you virtually watch movies with your ‘distributed friends’. Domino’s IT director Jane Kimberlin said “Second Life is where Domino’s customers are and therefore that’s where the pizza company needs to be too.”

How to make money? As is well publicised (in fact I can’t believe I am still talking about this) Linden dollars is the Second Life currency which can be converted into real world dollars. There are some businesses operating in Second Life that are earning real money selling virtual products. These include clothing, dance animations, selling or leasing property, buying even selling shares and the number of Second Life residents generating more than US$5,000 in monthly income has more than quadrupled to 116 in the past year, according to Linden Lab. Also brands who create product inside Second Life own the IP inworld and more importantly they retain it if they move it outside and create out of world, real product, so great news for inworld R&D. But selling things shouldn’t be your focus. It should be about integrating your brand and becoming a trusted addition inside this unique and vibrant social network. You must add value and not just build and run or build and not be around to welcome your visitors. There are way too many empty branded spaces in some virtual worlds. Lets see some of the brands that have already taken the plunge, this is a short edit of a longer video I compiled on the stand and it looks at a few recognisable names.

SELF CUT VIDEO: Motion grabs of branded spaces in world. 3 minute edit of the longer 30 minute stand one.

Quite a few recognisable brands there, so how are they doing?. Well on Thursday last week I went inworld and using the built in Search/Places facility which brings up the standardised traffic figures I looked at the ‘dwell’ traffic for each of them. Dwell is not just how many visits but how much of their inworld time they spent with each of the major brands. Also the inworld traffic measurement is the only real way to compare like with like which is why I am showing it to you. So here are the results.

1. BigPond – 18139
2. Pontiac – 13832
3. IBM – 12850
4. Showtime (L Word) – 7233
5. ABC TV Australia – 6898
6. NetG Training – 6536
7. Mercedes-Benz – 5656
8. Nissan – 4269
9. Mazda – 2827
10. Dell – 2759
11. MTVN – 2317
12. Toyota – 2119
13. Sun Microsystems – 1728
14. Sears – 1596
15. Sony BMG – 1560
16. Cisco – 1521
17. Adidas Reebok – 1351
18. Sony Ericsson – 1242
19. PA Consulting Group – 1138
20. Circuit City -1089
21. Reuters – 1019
22. BMW 842
23. Intel – 829
24. AOL – 797
25. NBC Universal 745
26. American Apparel – 596
27. Starwood Hotels – 35

Great news for Australia with BigPond and ABC (built by the Project Factory) in the top five and this is months after launch, so outside the hype curve. But why are some of the others so low? All those wonderfully designed, branded buildings with lots of things to do? Well to me a couple of the critical elements that many brands have missed are –
Firstly- Creating spaces that are just really nice to spend a long time in. Sounds simple but many corporate builds are just cold and too representational. They should be organic, of value and welcoming and where inhabitants can create their identities inside their own stories. Of particular note is the outback bar area of the Pond which is currently in the top ten of all second life brands itself on a ‘dwell’ basis, but more importantly it is part of a mix of features and functions that you need to create.
Secondly – A space where the inhabitants can create or contribute to the environment. So both The Pond and ABC have sandbox areas where residents (particularly new ones) learn to build and add things to the branded space. Also requests for changes from the visitors to the existing build should be taken seriously and acted on. Give them a sense of ownership of the space and they will thank you which will build trust.
Thirdly – Be authentic and talk to them at an equal level. Too many companies still talk down to their customers as their avatars do the ‘hard sales pitch’ thing. This is a real opportunity to show the human side to the brand, give it personality and again that insight will be endearing to the residents. A major consideration for many brands is to actually commit ‘real life’ people to be in the environment with the visitors 24/7. If you think you wont be able to collaboratively manage the community by factoring in the human resource follow-up, it might make sense not to start at all.

Advertising in these worlds are often seen as a big no, no from those inworld. Especially the old in your face, irrelevant, broadcast ad model. One thing we are experimenting with at the Project Factory is personalized and targetd advertising. This is not some Orwellian (or Minority Report) nightmare, more a way that the environment (at its crudest level ad hoardings) will change dependent on who is around them but there are many more subtle ad R&D experiments we are trailing. We, like many other developers, are learning as we go along and will never assume that this sort of functionality will prevail. An area that we definitely believe is here to stay is allowing residents to creatively interact with your brand or product. So let them co-design new product with you and listen to what they say about your existing products or services. Never before have brands had this opportunity to be so close to the consumer, you are in there with them, in real time, collaboratively.

Companies succeed in virtual worlds when they take much more of a lifestyle approach to their marketing. Whether you choose to go down this road and participate or not, Virtual Worlds will remain to be one of the most compelling ways we will interact socially and commercially in the future. The Project Factory’s virtual world services are also about merging the real with the virtual and creating experiences that are interactive, social and immersive. It is a very exciting time to be involved now at the dawning of this very real, virtual revolution. I hope that this brief talk wheted your appetite. If you want more come talk to us on our stand and check out the website listed here.

Thank you and time for a few questions?

and not mine but a great video about potential for brands (albeit slightly smoke and mirrors re: the interactions in this video) from Text100 and thousands of views on YouTube.

Posted by Gary Hayes ©2007

Apr 212007

360 Award Winners
YAY! Jackie my LAMP cohort and Paul Bennun (a new LAMP mentor on the next lab in Tas) won their development awards categories! more later…Writing this on various jetlagged Europe to Australia plane hops so excuse any fragmentation of style – will be tidying and adding links and speakers quotations (to bring it to life) when I get back to Oz, compiling them on the last leg from Bangkok to Sydney. This is actually posted from the surreal Bangkok international sci-fi tube airport in a bleary haze from the previous cramped eleven hour flight (OK enough boring travel detail)…

This final full day looked on the surface like my ideal conference agenda 😉 Thanks Ferhan. So a delectable mix of seminars like social tools driving formats, virtual worlds (keynote, brands) and games in cross-media entertainment amongst many others! So how did it live up to expectation? First though a few comments about the Ashley and Jana double act the previous evening before Emmys…

BBC Keynote – Focus on-demand

Jana Bennett “We need to be ahead of the audience not behind them, The conversation can be creative, two way and in many cases multi-way. And we are witnessing new creative possibilities open up when many of these ripples bump against each other”

I am not sure what has happened since last year when Ashley gave a rundown of the many and various activities across BBC New Media including the latest broadband and broadcast interactive ‘TV-forms’, interesting new services such as the subtle ARG Jamie Kane (is it real or not) right through to a whole bunch of participatory aspirational and delivered online content. This year though it seemed to be Jana Bennett (Director, BBC Vision) talking broadly about embracing viewer created content and Ashley Highfield, (Director of Future Media & Technology) focussing wholey on BBC on-demand – whether via the iPlayer or a beta timeshifted interface for a forthcoming DTT, PDR (Personal Digital Recorder – wish they would use that rather than a DVR or PVR, which stresses video).

Ashley Highfield “Coming to a platform agnostic device near you soon. Our trials show that the BBC IPlayer counts for 10% more of BBC TV viewing in broadband homes…with this level of nascent demand we want to make BBC iPlayer as widely available as possible across as many platforms as is feasible. Were starting with the biggest available audience the 22 million who are broadband connected in Britain, The next biggest audience will be the 3 million cable homes. After that its Max, Media Centres, smart handheld devices and once we’ve done all of that we are going to turn to the really tricky platforms like digital terrestrial using PVRs or internet hybrid boxes”

Anyway so a little dissapointing from a ‘innovation’ perspective but encouraging as finally a culture of manifesting the TV-Anytime vision (which was not really about standards but about the many rich services that broadcast and broadband delivered audio visual enable – just wish people would read the flippin’ business models documents for phase 1 and 2, cause it covers virtually everything I saw at Milia when function, form, creativity and business models are discussed around on-demand (especially personalisation, mobile PDRs and targeted ads). Anyway, a long way to go it seems for the BBC as the 1000 clips/programmes is not a big enough pot yet to try the really cool stuff, such as ‘Buried Alive’ from last year. Hats off to Phil Jay and others for producing a nice carousel interface for the BBC PDR, subtle hints of Dale Herigstad work and even the very first Digital Text prototype I made that had a genre carousel selector – but that was nine years ago 😉

Back to the final full day. I attended in post Emmy wobblyness a Marc Canter breakfast. Marc is sold as a “techno rabble rouser, with an operatic voice”. In 1984, he co-founded MacroMind, which became Macromedia in 1991 but that is long, long ago. We had an informal chat with croissants and coffee, before his talk and it became a trip down memory lane of using Macs at the dawn of interactive creation, made me and a couple of others involved feel very old. His talk eventually got to his new passion – merging his multimedia heritage with social networks, creating what he calls ‘digital lifestyle aggregators.’

Marc Cantor “I believe that every single brand wants to have an audience relationship with us. Not now but within 10 years. Nowadays the notion is about digital lifestyle aggregate. Three fundamental principles. First is integration…if you could have your IM, with your blogging with your social network with your shopping all in one interface that would be an integrated environment, easier to use. Second, aggregation. Bringing all your information into one place. Third…customisation…”

He loves the word convergence and hates labels, especially Web 3.0, his focus is close to my heart and that is transparent interoperability between social networks and technology – a long uphill battle. In fact I had asked a similar question of Dr Yoo of Cyworld, could MySpace and Cyworld and all the other ‘profile’ based SocioNets ever be compatible so you can move info around instead of endless maintenance of all of them. Dr Yoo said extremely difficult, Marc Canter has the energy to at least trigger some strong thinking in the area it seemed. Brian Seth-Hurst as usual moderated the session and a quote will follow.

Video super panel TV 2.0 Meets Web 2.0
This was almost a clone of last years panel which was one of the better ones but with the addition of a comical Steve Billinger (now leading CBC Digital) and a more serious Henrik Werdelin (of the new kid on the block Joost). It had Mr Google UK Patrick Walker there representing the big brother, the black hole and lots of jokes about them buying the rest of the panel at some point.

Ken Rutkowski (moderator) “Google literally trying to take over everything from the desktop etc: and not in a negative way, a postive way, Everyone used to call Google a search engine it doesn’t even resemble a search engine anymore, there is so much content that is out there. How do you now take advertisers and help them get their brand in front of everyone. For example on YouTube there is no advertisement inside the video, like Revver does something that is post-roll, and others are doing similar things. Where do you highlight an advertiser inside the content?”
Patrick Walker (Google) “ Well the advertising business is based on the ad words, the websearch side of things. It is a very robust business and we share a lot of revenue with partners. We are also introducing new forms of advertising looking how to play video ads, display ads on 3rd party websites. Were experimenting we have a very successful and major business thanks to the partnerships we have with advertisers and websites. So we are able to experiment on websites like Google maps and websites like YouTube where we don’t want to rush in and throw in a bunch of ad formats that maximise revenue but destroy the user experience. We have an engagement model that comes with advertising and so we will slowly introduce ads, we will experiment and get user feedback. At the end of the day if you can deliver ads that are relevant and are interesting and specific geographically then that itself becomes interesting content”.

But the panel showed that things are maturing very quickly and I pointed out that Patrick and Andy Grumbridge (Managing Editor C4 UK) were sat next to each other and asked about my tipping point observation that Google ad sales are now ahead of C4s. Andy kind of resigned to the writing on the ‘bottom line’ saying that C4 were still good at doing video ads so will be around, albeit ‘never’ again to overtake Google.

Gary “It is interesting that Andy and Patrick are sitting together C4 and Google because I think it was this time last year when for the first time in history Google ad sales were bigger than Channel 4 and it sent shockwaves running through the industry. I am just wondering if you see that as some kind of tipping point?”
Andy “We are quite good at doing video ads so we think that’s a good opportunity to get back in the game. I am not sure we will ever be as good as Google again. What was interesting though was that was achieved not through video advertising but through ad keyword display”

The panel talked again long and hard about ad funded video, the tidal wave of viewer created and the difference between aggregators and content makers. I will follow with some quotes below that tackle some of these head on. I mustn’t forget the final speaker Anthony Lilley, CEO, Magic Lantern Productions and William Linders, Executive Director Digital Media, Endemol who represented the content side of the discussion.


The virtual world keynote from Phil ‘I-try-to-be-a-reluctant-benign-God’ Rosedale” – a 101 for the fascinated hoarde.
We had to put up with this strange passport style image of Philip all week starring at us from various promo billboards around the palais – but it seemed to draw interest and it was a packed hall for this keynote. I had had a quick chat with Phil at the Emmy’s about things such as branded registrations into Second Life and the national mix but his talk to this noob audience was really a quick intro combined with some good metaphors about why SL is significant. The most poignent and resonant point he made (again for me at least!) was about real time, collaborative communication – Second Life represents people being online in the same space at the same time in a user generated environment (vs the abstracted’ness of 2D web interfaces, time shifted comments via blogs, or time shifted edits on wikis and so on).

Phil Rosedale “Nobody jumps into a new medium as an organised controlled strategy where their trying to deploy business advantaged content on that platform, it never happens. A bunch of virtual reality companies were too early in the 80s and 90s simply approached the space, the whole idea wrong. All new mediums, instant messaging, the web itself, email, television they started with whimsy, fantasy, vanity, artistic self-expression, they didn’t start with business applications, they didn’t start by trying to market real world products”

A packed crowd in the Esterel Auditorium therefore had a basic intro to Second Life and it was a shame they didn’t see the thousands of other things it represents and why Phil had to pull out images of Angshe yet again? – money talks I suppose. He did mention the many developers that are around to hand hold potential brands and TV properties into SL (including MUVEDesign of course) but referred specifically to Millions of Us and Reuben Steiger in the panel following.

“Second Life is still hard to use on a lot of machines doesn’t run well on a lot of laptops. Open sourcing was a big piece of this, were building out our team as we become profitable and are able to get many more engineers working on R&D on this. Expect Second Life to run a lot smoother, it should just work like a browser” Phil Rosedale

More significantly he was asked about the User Creation percentage referring to the 1% creation and 99% voyeur on YouTube…

“This is a point that the world of broadcast medium is really something to really think carefully about. When we started with Second Life, of course everyone spent all their time making things. Well the reason for that was the world was basically a sand block with palm trees, so if you wanted a house you better, make a primitive and paint it and sit there with your friend, it was the only thing to do. We always said as this matures as Second Life gets mainstream, whatever that means, we will see that number drop down. We looked at the number about 2 years ago when Second Life was 25 times smaller and about 30% of peoples time was spent making stuff. Now we have grown more than an order of magnitude and guess what the percentage is now, about 30%. I suggest this is the reason. We believe that people want to be entertained by passively consuming content, we have always believed that. I think that this is one of those cases where we are mistaken in why we believe that. We think because it is in human nature , most people just want to sit and be entertained, I think that is wrong. I think what we are missing is that in the past 50 years the only way we have been able to distribute great content to people is by a centralised, single point distribution mechanism which reduced costs to a reasonably point. So we believe we are passive entertainment consumers only because technology has let us do it that way. If people want to be creative 30% of the time then everyone had better rethink the nature of media and what that means”


Here we see Phil showing the audience his inworld identity – I was thinking at the time shouting out that ‘hey, you should get a good skin and hair, your embarrasing the hardcore avatars” (he looks like a noob for the uninitiated) 😉 But he made some introductory remarks about the nature of identity in Second Life and the usual audience ‘gasps’ when he started to fly, yawn, but hey all they had seen up to that point was him rezzing a bunch of powerpoint slides on the beach! Even so I had lots of folk say later ‘ooh we must buy an island and do x, y and z’ – and as usual I had to point out that certain of those things were not the most engaging for an SL audience, which was excellently covered in the next panel.

One statement from Phil that brought another few gasps was his rather matter of fact way he delivered the following line when Ken asked him about his role within the world, president, dictator?

Ken Rutkowski “Your the president of Linden Lab and so there are several million people in this environment, so are you the president…of this world? Are you seen as a president, a dictator, what are you?”

Phil Rosedale. “Depends on the day or the nature of the last software release…I try to be a reluctant benign god within the virtual world.” (sniggers from the audience) He tried to justify this statement “Theres a deeper point there. Second Life could not be successful if it were centrally controlled. If our position was that of editorial content arbiter for example I can guarantee you that it would not be as successful” and added earlier “We dont make deals directly with broadcasters or content owners; were a level-playing field platform”

Marketing in Virtual Worlds

Promised to be a great panel but I think a concentration on just Second Life and not on other less immersive avatar based psuedo 3D services would have been better. Even so we got great insight from BMW (Jens Monsees) and Millions of Us CEO Reuben Steiger gave an inspirational look at human evolution and why we are moving into virtual worlds – a proper quote to follow but he talked about the basic human need to build and make things, rather than passively consume media.

Reuben Steiger “What we say to brands coming into Second Life one of the first things we say is you have to be culturally relevant. Secondly brands need to relinquish control. Very tightly scripted, formulaic experiences don’t work they miss the mark completely…Brands need to embrace an element of user creation and chaos and the brands role is to really set the stage around their brand but to give users things to do and ways to change their experience – to give pens to their users. The brand has to write the first page of the first scene and its up to the brand to have the bravery to hand pens to their audience and let them write the rest. That is the only way to be successful.”

He also had a good array of what brands and properties should be creating for the community of Second Life – like Phil Rosedale before him tripping off the standard line ‘you must add value to the community’. I added in a question at the end that brands/properties MUST be prepared to put a lot of effort into post build with human resources too, everyone agreed. Other speakers and more quotations, especially from BMW’s experience of the virtual society to follow below..

“Our typical campaign the results are very very dramatic. Within second life our average client will get between 30 and 50 thousand users over a three month period, coming into direct contact with the brand. For our clients that is a rounding error they don’t think in terms of these numbers. Here’s where it gets interesting. The average engagement ranges from 20 minutes to 5 hours! That’s off the charts. If they do it in the way were describing it here that’s imaginative and user generated and somewhat chaotic, the experience leaves Second Life and the conversation moves into the blogosphere, they take photos of themselves interacting with the brand and upload them to flickr, movies to YouTube, Impressions in the blogosphere are between 1 to 10 million the same as in mainstream media. So the experience happens in Second Life with a core community and all the reach is on the net”. Reuben Steiger, CEO Millions of US

Eileen Bastianelli, Managing Director, Shake Content/BBDO (France)
Bas Verhart, CEO, Media Republic Development (The Netherlands)

Games for Cross-Platform Entertainment
(I can see people shifting down to gate C3 so will just quickly type a few lines to be developed later). This panel really stood out against the rest of the more integrated (for TV folk panels). Deftly and expertly led by Matt Costello (who had too many things to contribute to really be a moderator) it felt though a bit too much a look ‘inside games industry’, under the bonnet and a bit disenfranchising for TV folk. Some were drifting out as they talked about the detail of games design and not really about true cross-platform integration but Matt did mention some interesting parallel and cross-over, mixed reality formats between shows and virtual worlds that caught my ear (especially as I am involved in a few both in LAMP and in the commercial sector).

Deborah Todd “With CSI the people who worked on the game, the developers, they had their own writers but they worked very closely with the CSI writers in LA. So yes it does make sense (to integrate the show writers into the game production). The gaming world is very collaborative and I think it makes a lot of sense for us to get as much input from people as possible. But just because you have somebody who is familiar with the show doesn’t mean they can think in a non-linear fashion. Its very dangerous to think that your script writer on the show is going to be just great at coming up with your game. There are design elements that come into play, character development and sometimes you have to create backstory, puzzles, things for players to do etc:. It is better at this point in time to hire someone who has that capability and who can hit the ground running”

Most of the focus though was on sticking the game on different platforms rather than parallel or linked services. Also, although they broached it slightly, they missed the chance to talk about cost effective it is to enter customisable MMO’s like Second Life for new entrants – after all there are plenty of MMORPG like worlds inside Second Life (Midian, COLA etc) and no one even mentioned the L Word or Laguna Beach as TV property brand examples. Anyway Matt and Gina Jackson (Head of Business Development: New Media, Eidos Interactive Ltd.) and the knowledgeable Deborah Todd, (Independent designer, writer, producer) kept the hardcore games folk happy – just a shame it was over the heads of many there. More detail to follow…

Tools creating new media forms
A great idea for a panel but at the start there should have been a real overview and context as to what we were about to see and their relevances and scope! More to follow – here are the speakers
Mark Bole, CEO, Shozu ( USA)
Justin Bovington, Creative Director, Rivers Run Red Europe (UK)
Suranga Chandratillake, CTO & Founder, Blinkx (USA)
Olivier Dufour, CEO, SkemA (France)
Petteri Koponen, Co-founder, Jaiku Ltd (Finland)
Claire Leproust, VP Marketing & Content, Eyeka (France)

Lifestyle media future panel
Must admit to falling asleep for a bit in this one only to be awakened by a power cut (a Milia first? – perhaps as the produced Zapping Show was being rehearsed upstairs)…here are the panellists for now and another quote from Marc Canter who really was the only forward looking speaker…

Marc Canter, CEO, Broadband Mechanics Inc.(USA)
Eyal Hertzog, Founder and Chief Product Officer, Metacafe Inc. (USA)
Joe Michaels, Senior Director, Entertainment Business Development, MSN, Microsoft Corporation (USA)
Joanna Shields, President, International, Bebo UK Ltd (EMEA)
Michael Werber, Managing Director, FiveWorks GmbH (Germany)

Marc Canter “One thing that it is important for the crowd here to understand is that the other fundamental shift that’s happening is that the traditional world of media puts themselves in the middle. Theyre the copyright holders, theyre the investors, theyre the company…they are important, the paraparazzi shoot them and that’s the centre of their universe. They have this concept of customers, they will take what we give them. That’s pretty much mainstream media. Now I want you to flip it. I want you to imagine that the number one most important thing is actually your customers. Imagine that I/me are the most important thing. The number two most important thing are my friends and family. They are the people I care about, consumers don’t care about a company. In fact we should not even call them consumers, they are not ‘born to buy’. Think of this as concentric circles. You are in the centre, then friends and family surround that and finally the brands and companies surround these people, trying to reach into their pockets to turn them into consumers…technology and the software that runs on it is social…and people are the most important thing.”

Zapping Show
The closing ceremony of Milia (vs Mip) as the 360 pitching folk, eight teams this year, are given their big cardboard checks and a development deal. The show itself was not as good as last year mainly because the 30 sec pitches were a bad idea – listening to 24+ of these was tiring especially as they all came out very vague and samey after a while. Would have been much better to have a few visuals and something about the personality of the teams. Ray Cookes was his usual cheeky Cockney self but the highlight of the evening for me was when Jackie Turnure won the Ogilvy/AMEX pitching comp (really the hardest category being overtly advertorial) – she seemed genuinely surprised to win, but very well deserved as the project, a Diamond Heist ARG, has most potential. Other notables was Paul Bennun (from Something Else – and a mentor in Tasmania for us in a few weeks) and a LAMP alumni Kate Crosse who was showing off the Deep Sleep project, which I believe would have won the BBC award had she not been Australian. Shame.


(The plane is being called now!) I will provide more feedback on the 360 pitching comp later, why dont they have WiFi in economy class ;-( But I will talk about Patou Nuytemans from OgilvyOne Worldwide and others comments about the process on the Friday morning review session later too…Phew, now wheres my boarding card!!

Posted by Gary Hayes ©2007

Jul 162006

Update article: Networks in crises – from the Australian about the tsunami about to hit Oz shores, a region entrenched in the old advertising model…

original post…
Two articles about the fraught changes in advertising caught my attention this week that reinforced many things that I had been talking about during a major curriculum review at the Australian Film and TV School, namely the decline of traditional broadcast TV ad models to such an extent that budgets for film and TV across the board are going to drop considerably. I know that I and many other thousands have blogged about this over the past year or so but I think as we are at the tipping point, and there are a few who still hopefully believe the balance may go back the other way perhaps time to re-blog. This first item from the Sydney Morning Herald (Meet the Always on Generation) talks about the always on generation and includes some useful statistics about the transfer of advertising models, as well as generation y and tech habits (which I will not cover).

Internet advertising has also seen exponential growth as advertisers go online. The Australian online advertising market grew nearly 50 per cent last year, with $605 million in revenue. The figure is expected to increase significantly to more than $1.5 billion by 2009, according to a report by research group Frost & Sullivan.
The report attributed “the online industry’s growth to the rapid migration of eyeballs from traditional media to the internet and the increase in online media consumption across all demographics; strong uptake of broadband by Australian households; the evolution of wireless technologies such as 3G, which allows for digital advertising across both online (large screen) and mobile (small screen); and an increase in online spend by major advertisers and agencies”. (snip)
According to Bob Peters, young men are the hardest market to reach as they watch less television than young women. Online gaming sites are enormously popular with this group; for example IGN Entertainment, which has sites such as ign.com, and gamespy.com, says it averages 15 to 20 million unique users a month, 91 per cent of them male, with an average age of 22.
Brand communications specialist Neal Latto says that, while gaming offers a lot of exposure to advertisers, the younger generation of gamers are “pretty cynical” about product placement in games.

That last line must cause ad agencies blood to run cold as they see decline in TV ad sales but the potential saviour online gamers being pretty sensitive (as in my earlier posts) to ads in their ‘worlds’. One can therefore see the real ad battleground as being the variants around Google ad words and as much top and tail short form ads inside online video content as possible. This was echoed earlier in the Hollywood Reporter article TV in Trouble without Revamped Internet Strategy – which says that everyone agrees that the crude measurement system of broadcast TV means there is no turning back to that model as advertisers insist on measurement now as well as the younger generations cycnism about advertising generally:

Already, the only way advertisers can connect with large numbers of key male consumers ages 18-35 is by following them to the many media platforms and devices they are using: downloading and playing video games, movies and music, and interacting with peers on social networking sites. The fact that television does not widely have the process or technological infrastructure to go there is sending shock waves through an advertising community that always has relied on mainstream media for neatly packaged mass audience sales bundles.

There has been much said about the need to follow consumers around their media platforms and I have talked about it at great length to commercial free to air broadcasters who perhaps saw it as a nice strategy but unworkable. They must think more at a personalised level across platforms they currently have interests in – it is an absolute must do if they are to survive the decade. The report talks about the internet ad spend around search in the US almost doubling over the past year yet against this the ‘heritage’ media broadcasters sit and do nothing or dip their toes into a raging torrent of change:

By comparison, broadcast and even cable television overall are in stagnant to declining ad spending modes that should surprise no one.

In recent years, most of the larger media company owners of these traditional properties have arrogantly ignored warnings to reinvent their system of measuring, pricing and selling advertising before it is consumed by the new interactive mantra. “The $61 billion consumers are expected to spend on new media products from iPods to DVRs will seriously erode what remains of broadcast network viewing and advertising strength,” I wrote in this column early last year. (snip) internal consultant Tim Hanlon observed: “Given fragmentation of media — the global media companies can no longer be relied upon to aggregate consumer behavior in mass market hits.” Their consensus: There is a dire need for the immediate construction of a fully interactive, universal television advertising infrastructure overlay that will bridge so-called new and old media and, more importantly, advertisers and consumers. Without it, television is destined to only flagellate, not thrive, in this new-media world.”

I can only imagine the commercial broadcasters are holding on simply because of the massive profits they still make against investment and of course we will see a decline in the quality of programming as they buy even cheaper and load even more ads until the bubble simply – deflates. When that will be no one knows, but I suspect it will not be a dot com blowout rather a slow, invisible leak followed by a pull over to the side of the road when they realise their tyres are flat. At the moment they dont seem to have any spares in the boot.

Posted by Gary Hayes ©2006

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