Feb 162009

I have blogged long and hard about the future of the metaverse and particularly how key sectors can make use of them as a functional tool. Education are already motoring, social activity is still the key driver, artists use it for music, video and performance and buying/selling ‘user to user’ businesses are still strong. One area that has received most contraversy is of course ‘real brands’, a so called exodus and ‘really’ what is the ROI. I published over at my MUVEDesign VW development site, a first stab at where I think we are on the Gartner Hype Curve for social virtual worlds (not game worlds!). Here it is again (linked from my flickr account).

Gartner Hype Cycle SVW

I do believe we are probably at the lowest ebb for brands in second life. This is bourne out by the SL brand stats I founded over at The Project Factory – you can see the dwell traffic for most brands outside the top 10 are exceedingly low. That doesn’t mean its game over. Far from it, as the lessons are learned and now it is time for companies to get it right, by avoiding developers that focus on build it and run (yes they are still here) and deliver experience, social interaction and relevance. I cover this in a lot more detail in posts back in 06-08!

Andy Mallon over at the Social Research Foundation has published a nice Annual Surver PDF report which is an inworld survey of Second Life users who ‘know’ second life – vs the tourist reports we often get from fly-by-night journalists or Gen Y social marketeers who don’t get it! Heres the blurb on the report (seeing I use the nice charts below!) Gotta earn my keep 🙂

The First Opinions Panel is the largest consumer research panel in Second Life with 10,000 members from newbies to the most active and involved “residents” who, Own the most virtual land, Spend and earn the most money there, Spend the most time there, an average of over two hours a DAY!, Run the most groups. Over 1,000 of our members own one or more groups in SL, many with hundreds to thousands of members. These are the leaders in Second Life. They are studied by over 33 demographic and psychographic attributes from both their real and Second life.

Firstly the longevity for users in Second Life. Remember that at the moment there are between 60-75 thousand users inworld at any moment and 31% spend an average of TWO HOURS a day in Second Life – 2/3 spend at least ONE hour a day! The next question is what is the churn rate, how long do people actually hang around using the service?



So Second Life is perhaps not ‘for life’. It seems many folk do tire of it at around 18 months with only around 20% going for longer than two years. Again this isn’t a real issue for brands as the culmulative user hours across the board puts Facebook, YouTube and other social spaces to shame.

This culmulative dwell is also on the increase. Get a user loyal to your brand and you may have them for longer than a year. Which seques nicely onto how do those inworld for these long periods actually want to interact with brands…


The item that stands out for me is ‘product development’. This has been consistently under utilized so far and there is still a big gap in the virtual marketplace for a big brand to really go beyond designing a hotel layout or fantasy coke machine. I know one brand will be stepping up to the mark this year and demonstrate how powerful this aspect can be. One item that is missing for me is brands ‘presenting’ to inworld inhabitants and facilitating ‘Ted talks’ like events rather than that being the domain of academia only. The SRF published a few choice statements from savvy inworld folk that reinforces several of the key points I and others have been bleating about for years.

  • “Don’t advertise to me – give me something that does not waste my time – make me want to learn more about by entertaining me, informing me or educating me. And make it cool.”
  • “Don’t just expect to do normal marketing – you have to hold events and interact with people”
  • “Bringing real world products inworld is the next inevitable evolution.”
  • “SL is a great way to reach those whom may need services that you may not reach otherwise. ”
  • “Real life companies tend to create great places but just leave them behind. They should assign some people to stay online and accommodate those people who visits their places in Second Life.”
  • “You have to engage people in SL, not simply put up marketing messages and expect residents to flock to you.”

The survey goes beyond well trodden areas too by asking about their Real Life Primary Job and how Second Life has been an enabling tool for it. It is no surprise that learning, collaboration and meetings are high on the list but what will become more and more significant will be real world recruitment – gauging a persons abilities and/or personality inworld. Kelly, Accenture and others are already versed in this space.


With the level of doom about brands in second life this question goes to the heart of what activities are on the decline. So looking at this chart the shorter the bar the better and running RL businesses in Second Life is the least in decline. (It is not clear from this chart if surveyed folk actually answered all questions so will leave it a little to your imagination as regards a true split here)


As a finale and related to the above, Clever Zebra’s Virtual Worlds for Business 2009 is now out as a free publication looking at VW for business applications. Unsure of the ‘enterprise readiness’ of all ten worlds author Nick Wilson highlights companies that are already sold on VW for meetings at least – which is slightly contradictory to him saying, expect to be logged out of meetings regularly? Anyway in the free report here are a few quotes from the document:

Dell “Employees report that they are more engaged in the 3D environment than on a conference call and that they feel more involved and apt to participate. An added side benefit is that this pilot project affords Dell the opportunity to experiment with moving toward a greener future where more and more employees work from home, not the office.”

IBM “IBM estimates that they saved approximately $250,000 by taking the conscious decision not to hold the Virtual Worlds for Business conference (normally a 2.5 day in person meeting) physically this year, and more for the Annual General meeting (normally a 3 day event for 400 Academy members and affiliates).”

Sun “Sun were able to transform an otherwise exclusive, expensive event into an inclusive inexpensive one open to a much wider audience of junior engineers who would benefit from the real learning experiences provided in a virtual setting. They were even able to get Hal Stern, Snr VP Systems Engineering to come in and do 2 full chat sessions exclusive to the virtual component of the 2008 CEC.”

Jan 072009


Reflections by me? Been a bit slow off the mark blog wise this year as endless layers of projects overlap and blogging has fallen off the list. But there are some goodies about to be blogged here, just simmering, almost ready for serving. Smell that goodness.

For the moment though two of my ‘thinks’ that others published for me. The first from Bettina TIzzy’s great (‘What the World Needs Now is‘) Not Possible in Real Life (NPIRL) blog who posted a selection of my slightly half-baked thoughts re: virtual worlds. Following that, also featuring SL & Telstra, a rather positive retrospective from ITWire extensively quoting me, about how companies can engage properly, The Pond is a build I created back in early 2007.

OK to the post. I know, a lazy re-posting but there are a few nuggets in here…over to NPIRL.

Gary Hazlitt turns the page on 2008 – What happened and what’s coming in virtual worlds

Sydney-based Brit and marketing wiz, musician, composer and rich content creator in virtual worlds Gary Hazlitt (aka Gary Hayes), is already done celebrating the incoming year, while we wait for a few more hours in the Western Hemisphere for 2009 to arrive.

Gary, who studied physics, is the director of the Australian Laboratory for Advanced Media Production (LAMP), and also heads up Virtual Worlds for the UK-based The Project Factory, for which he produced the highly successful and eminently revistable (as the traffic numbers indicate) Australian Telstra and ABC Second Life presences.

I welcome Gary’s guest blogpost and knowledgeable take on the recent past and the coming adventures of virtual worlds. Happy New Year, everyone! – Bettina Tizzy

In the social Virtual Worlds context, 2006 was about hype… another new frontier ‘kid-on-the-block,’ but became about fast bucks and cheap and cheerful PR. We saw that bubble gently burst in 2007 as the realisation that one world in particular, Second Life – (which is still the leading example of culturally created virtual content), was really about creative communication and artistic expression versus the local shopping mall or a crude business tool.

Last year, 2008, we witnessed a distillation in what Second Life (and by implication other customisable worlds) is really about, leading to a proliferation of new, niche virtual worlds meeting the cultural and entertainment needs of much broader demographics. We effectively saw the ‘fat’ surgically removed from Second Life and an acceptance that this new medium and form is still in its very early days, but in 2008 there are clearer reasons for being a part of the social web mix:

1. An immersive expression of community – Facebook and MySpace-meets-World of Warcraft. This community can create their own environments or swarm around trusted film, TV or lifestyle brands, too.

2. For business, it is more about a place to meet, present and recruit and far less about brand awareness, product sales or vacuous hype. The business model in 2008 clearly came into focus: the community selling to itself – brands needed to court existing inhabitants very carefully.

3. For education, Second Life is one of the most efficient tools in the learning process. Education becomes democratised, everyone can contribute and learn equally, remote learning is far more compelling, fun and immersive.

4 A creative tool. Second Life, in particular, showed significant maturity as we saw a higher number of serious live performance (CARP Cybernetic Art Research Project, NMC, DanCoyote Antonelli, for example), a record number of in-world ‘machinima & TV-like programs’ and by far the largest array of creative statements from virtual environment artists, many members of the NPIRL group. The quality of ‘experience’ creation from talented musicians, designers, photographers, artists, etc., reached new heights.


Investment across the board – more than $900 million US invested since Oct 2007 – has moved away from generalist worlds like Second Life to more focused niche or user base environments with many starting to exhibit core game elements. These include those with renewed investment after new’ish launches: vSide, Football Superstars, Stardoll, Home, IMVU, Metaplace, Multiverse Places, and Music Mogul.

Towards the end of the year, console social worlds came onto the scene. XBox360 and Wii are very similar in ‘cartoon’ aesthetic, whereas Sony is far more game focused. All have very similar business models – create a space to hang out and be ‘tempted’ by games/film/merchandise. Although these are not yet places for community creation, they will soon learn that to keep inhabitants they will need to be or, like Google Lively, have to pull the plug. Embeddable or layered worlds began in 2008 and are likely to be significant in getting people used to real time communication through ‘representational’ avatars – vs text based ‘social network’ profiles. Also, Facebook worlds like YoVille or Vivaty, or layered worlds like Rocketon or Weblin that are embedded on the existing 2D web. The dominance of the likes of Club Penguin and Webkinz at the tweens end of the spectrum will be duplicated through teens and gen y’s as a series of new, highly focused and targeted social worlds launch next year. This has already begun with Football Superstars and Music Mogul but expect to see many more – including several with user created content as a feature alongside the virtual economy.


– Graphics in Second Life become teenagers. Still some way from the likes of Crysis, Second Life Windlight turned the world into something far more fantastical for many. It added layers of light, glow and control to a previously very ‘flatly lit’ world. We still wait for dynamic shadows, better environmental sound and an even more useful scripting language (post Mono), but this was a paradigm shift for environmental artists.

– Some companies got it! There was not a plethora of companies or brands entering Second Life but those that did had continued success as they concentrated on the social (people) rather than ‘product’ aspects of their business. Although the Pond leads in dwell terms, new entrants like Warner’s Gossip Girl have done exceedingly well. Car companies still do well even though Pontiac walked away from Second Life, and Toyota, Fiat and Nissan are always in the top 10 brands.

– The quality of machinima across all social and game worlds increased exponentially this year and a growth in communities watching ‘documents’ of the worlds they spend most of their time in. In addition to some machinima appearing in heritage media (“Molotov Alva and his Search for the Creator” and HBO/Cinemax, for example) there has been a growth in long form game-engine films and notably many more serious issues tackled.

– The New Worlds. A fracturing, as it became obvious that Second Life cannot be all things to all avatars – so nearly 70 other worlds all showed up on the radar. Many are focusing on niche interest or are highly branded. Several of the new ‘jack-of-all-trades’ entrants will learn that enabling community creativity and an economy is absolutely necessary. There were several walled garden/locked content mirror worlds and builds in 2008, which will learn to be not about ‘broadcast’ spaces, and realise that their worlds are far more significant than modelling what is around us – “In augmented and online virtual worlds, humanity will exponentially evolve, free from the limiting ghosts of that other virtual world we called reality”.

The second item appeared following my presentation at the Online Distribution and Business Collaboration conference from November 2008 in which I hurriedly went through some good inworld and game marketing case studies. Kathryn Small here picked up on why Australia’s BigPond is working really well – and no, it is not all about the broadband capping situation in Australia. Most of the regular inhabitants are on other ISP’s – anyway the article covers my thoughts on this and I have a much longer analysis with stats for the nearly 2 years it has been active, in the pipeline. (Also worth mentioning something about the item at the start of this one – Tourism Victoria didn’t withdraw its funding, Multimedia Victoria requested I take down a temporary ‘trial’ build of Melbourne Laneways – which had an original 3 month ‘learn as we go’ tenure on ABC Island. Otherwise a good item below.

Despite reports, Telstra and Second Life remain inseparable
By Kathryn Small 28 November 2008 02:20PM

It’s a match made in heaven: Telstra is Australia’s biggest telco and ISP, while Second Life is one of the world’s hottest social networking tools. So when the media reported that “the game was almost over” for Second Life, Telstra was quick to defend its investment.

Recently, Tourism Victoria withdrew its advertising funding from Second Life’s ABC Island. This prompted Deacons technology and media partner Nick Abrahams to comment to The Australian that “the drop in commercial interest in Second Life had been noticeable over the past nine months”.

Abrahams said that at any given time, fewer than a couple of hundred Australians might be in Second Life.

But virtual worlds expert Gary Hayes said that virtual world ratings should be measured in engagement and user hours, not just hits.

“Immersive online experiences need new metrics, and marketeers and academics are realising that social worlds do provide the potential for very high dwell figures,” said Hayes.

“Facebook has 65 million users on for just four hours per month. 132 Americans watch YouTube but they watch only about five minutes per day or 2.5 hours per month,” said Hayes.

“Second Life (and other social virtual worlds) has the highest rates of loyalty and stickiness of any social network generation, more than 50 hours per month per user.”

Hayes said that Telstra’s islands, known as The Pond, had a steady stream of around 50-100 users at any given time.

Telstra spokesperson Peter Habib quoted figures compiled by The Project Factory which said that BigPond’s islands were the most popular in Second Life.

The Ponds were founded in March 2007 with 11 islands (now 16) which have hosted virtual concerts, ANZAC Day commemorations and even New Year and Australia Day events.

BigPond recently hosted an AUSTAFE event which involved live streaming of the event from Adelaide into Second Life.

The Ponds also contains five residential islands for users to build themselves virtual real estate to live in, at near 100 per cent occupancy.

Telstra spokesperson Peter Habib told iTnews, “BigPond’s commitment to innovation, interactivity and entertainment in Second Life is a key part of our success.”

Habib said that BigPond has opened a virtual in-world service kiosk that allows Second Life users to interact with BigPond customer service staff in a virtual way.

Hayes said that The Pond’s approach to customers differentiated it from many other brands.

“The real success of The Pond is more about the regular events, the creativity of the builders who often come from the community, elements of nationalism, and many of the organic spaces that promote stickiness by their ‘ambience’ rather than superficial interactivity. This has been a real differentiator.”

Habib dismissed the concerns of other providers with success on Second Life.

“While other companies may not share BigPond’s successes, we are more than pleased with the popularity of our Second Life islands”

Hayes said that companies might not succeed in Second Life for two reasons. First, that many brands were brought into Second Life for the wrong reasons, and with misunderstandings about the social network. “You cannot build into a social network and not be social,” said Hayes. “Early entrants simply did not act human; they acted like a corporation, and built clones of the real world, and didn’t think experientally.”

Second, Hayes said that companies needed to change their offering to virtual customers.

“We are seeing the natural exodus of ‘showroom, build-it-big-and-boring’ brands and the settling of second generation ‘social’ and ‘purposeful’  brands. So The Pond, Accenture, Playboy, The L Word, and about five other key brands are really getting to grips with setting up a virtual base in a social world.”

John Brand, research director at Hydrasight, agreed.

“Only organisations who want to be perceived as ‘bleeding edge’ should ever have been involved in Second Life in the first place,” said Brand.

“Now that Second Life is entering its relative teenage years (measured in Internet years at least), the early adopter bandwagon has well and truly been jumped on.”

But Brand (edit: Hayes) noted that Second Life is not the only virtual world.

“There are at least 50 other mainstream entities and the total audience (according to a trusted site on this topic, KZero) is well over 300 million. In the second quarter of 2008, $161 million was invested in 14 virtual worlds, in the first quarter $184 million put into 23 virtual worlds, so the total this year alone is $345 million across 37 new worlds.

“Australia is a tiny market compared with Europe, Asia, South America and the USA, so fluctuations are highly likely. The fact that the user base of one virtual world fell by 23 per cent in a year is common with any service coming out of a hype phase into a stable mature phase.”

Oct 252007

As usual I feel so guilty about not blogging as much as I should – partly due to just producing so much…starting to believe the new adage that someone mentioned to me a couple of years ago – “those who don’ t produce, blog” – that might muster up a comment or two 😉

Anyway onto this little quick post which I am creating a lovely 3D graphic for for as I expand it – Augmented Reality TV. The two videos below basically say it all and please wait for a fuller commentary in the next few days. My key interests in this space are obviously running LAMP and steering its direction, Head of VWs for “The Format Factory” (linked to The Project Factory) where I am also creating and drafting several formats in this hybrid space and many public presentations, bite size one here for example and invited to talk on this topic in a few weeks in Brussels at the Cross-Media Storytelling shindig. But anyway videos speak louder than words (ish) so here goes…

TV and Story Enter Virtual Worlds – CSI today!

Virtual Worlds Enter TV and Story – Boxi, HTV7 Vietnam

BTW you really have to watch to the middle of the last one and then imagine if those avatars were being driven in real time by say Second Life users, using their own SL identities! I think the two examples above highlight in the most simple way the rich hybrid space growing as the two hemi-spheres of influence of 1) Social Network Virtual Worlds and 2) Traditional Broadcast media begin to overlap. I also love the CSI example (are they really gonna crash the grid today expecting 2 million to flood in – I hope not! ) as it fits neatly into my Cross-Media Level 3: Bridges zone. But this is about participation, participatory TV, inhabited TV and other variant, combinations. This has far more significance than the SL Big Brother I blogged extensively about last year, which was really a Virtual World clone of the TV one. This new form is drawing large numbers of audiences onto shared screens and into virtual spaces creating a great combination of non-passive immersion.

More to come and a lovely 3D diagram naturally 😉 Finally a couple more trailers for the CSI in Second Life show

and a shorter version

© Gary Hayes 2007

Apr 272007

Gary Hazlitt orates 01

The Second Life builds I did for Telstra BigPond and ABC TV (interview with me at SLOZ and also here at CeBit about this) have been very successful (via The Project Factory) and I have been ‘sucked’ into doing several keynote, panels and seminars about this exciting development. The growing maturity (2nd generation) of brands, business and advertising in Virtual Worlds are very much in the zeitgeist at the moment (see previous Milia posts for example and from Brad Howarth) and for those around the Sydney area here are the event dates and some abstracts about some presentations I am giving in this space – (below them is some very interesting brand statistics from Second Life…)

May 1 – CeBit Keynote. “A Brand and Media Survival Guide to Virtual Worlds” (I will be speaking alongside Google and Mozilla amongst others)

Thirty minutes to get up to speed with a revolution. Gary takes you on a whistle-stop tour of three-dimensional virtual worlds and the opportunities for your brand development. He will attempt to navigate the complex maze that is the relationship between audiences in worlds such as Second Life and companies that are looking to create a presence there. What do people actually do here? How can you reach them?

A recent report by Gartner says that 80 Percent of Active Internet Users Will Have A “Second Life” in the Virtual World by the End of 2011 and Gary will explore the reasons why virtual worlds are transformative and immersive. He will analyse some of the key statistics about the naturally communicative audience and ask “Is this really a revolutionary web 3.0, the real-time, collaborative 3D web or another bubble about to burst?”.

May 2-5 – Delivering a “Business in Social Networks and Games” at the LAMP/CSB residential helping previous LAMP projects develop business models.

May 10 – “PR opportunities knocking in virtual worlds” at the 8th National Public Affairs Conference.

More than 850,000 users are spending real time and money in virtual worlds such as Second Life. But will the craze last, and how valuable will it become for PR?
– Abigail Thomas, Head, Strategic Innovation & Development, new media and digital services, ABC
– Gary Hayes, Director, LAMP and The Project Factory and architect of Telstra and AFTRS Second Life projects
– Mark Jones, IT editor, The Australian Financial Review

May 15 – “Business in a Virtual World” at an AIMIA Intimate. I am both moderator and panellist.

Virtual worlds, such as Second Life, are getting a lot of publicity. Of particular interest is the bustling economy developing in these worlds. Business is booming and some people are making serious money. The ABC and Telstra both have presences in Second Life. Come along and hear industry experts from Habbo, Legion Interactive, KPMG, Swinburne Univ and others discuss:

– The popularity of a virtual existence.
– The appeal of setting up a business in Second Life, or any other virtual world.
– Doing business in a virtual world and the ramifications.
– The new virtual marketplace – what marketing principles have changed if at all?
– The future of virtual worlds – how sophisticated will these worlds become? What will be the ROI? What challenges lie ahead for the companies behind these worlds to maintain a vigorous economy and vibrant community?

Date: Tuesday, May 15, 2007 Where: The Shelbourne Hotel, “Altitude” level, 200 Sussex Street, Sydney. 6.30pm for 7.00pm start 7.30pm your chance to ask questions and then back to mingling 10.30pm bar is closed.

May 20-25 – “LAMP: Story of the Future.” Directing and leading a special LAMP Residential for a week in Tasmania with eight cool projects with an emphasis on rich narrative, destined for Virtual Worlds, Games and Cross-Media distribution.Phew, lots on. I will post my CeBit keynote here next week for those who can’t pop along to Sydney, Australia but before I go one thing I will be referring to is how branded ‘spaces’ in Second Life are doing, comparatively. On Thursday morning I did a snapshot of the traffic across all the main brands in Second Life and came up with something surprising:

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

Statistics were complied at 11am 26th April and a little about how the traffic figures are calculated from Linden Lab.

Traffic is a number for each parcel which is based on the amount of Residents who visited, and the time spent on that parcel out of their total time inworld that day. It’s calculated using a complex algorithm. Every user gets a set number of traffic points to give out during the 24 hours between midnight and midnight. Any parcel of land that the user spends more than 5 sequential minutes on gets counted as a place that they spent time. The user’s points are then evenly divided between those parcels. So, if I was online for 1 hour and spent 20 minutes on resident A’s parcel and 40 minutes on resident B’s parcel, resident A would get 33% of my points and resident B would get 66%. Alternately, if I only spent 5 minutes online and spent all of it on resident A’s land, she would receive all of my points.

The images below are grabs a day or so later to show a comparative methodology, the only real way to compare like-for-like using the search/place traffic data built into the interface.

SL Stats BigPond 02

SL Stats Pontiac

SL Stats IBM

SL Stats L Word

SL Stats Mercedes

SL Stats Nissan

SL Stats BMW

SL Stats AOL

SL Stats NBC

Lots more projects now in development via the Project Factory to build on the foundation of the Australian brands that are themselves moving into a third phase – keep an eye out here 😉

Posted by Gary Hayes © 2007

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