Advanced caution:  If you’re a die-hard Second Life fanatic and Linden Lab Loyalist, you might not want to read this post.  It’s a bit scarey.

The Virtual Food Fight… it’s coming.

Do you think Second Life is the only game in town?  Go to Google Search.  Enter VIRTUAL REALITY.  Prepare to spend several days visiting sites.  Agreed, Second Life is somewhat unique at this time.  But that is changing.

Search HiPiHi.  See what you find.  Search Open Sim.  See what happens.  Definitely not the only game in town.

Now for some real fun, visit http://Lively.com.  Check out who sponsors it.  Uh oh.  Google.

Welcome folks, to the Virtual Food Fight.  We’ve been warning Linden Lab about the VFF for oh, some 3 years now.  What it entails is other companies figuring out that VR worlds are profitable (Linden Lab sure proved that) and entering the fray.   Fortunately for Linden Lab, that takes a while.  There is a lot of planning, hiring, designing and coding to be done.  Not an overnight project.  Unfortunately for Linden Lab… they spent most of that time  alienating or even making enemies of the vast majority of their customers.  Company policies, unstable platform, griefing, lost inventory, blaming the customers for company problems, knee-jerk decisions, you name it.  The record is not good.

Vast majority I say?  Absolutely.  Look at Second Life’s supposed “residency” figures.  Now look at their active member figures.  Ouch.  As of this date, approximately 95% of all those who have ever signed up for Second Life no longer use it.   That is MILLIONS of people.  Triple ouch.  Add to that their loss of 7% of their paying “Premium” user base over the last 7 months (that’s 1% per month folks), and the future does not bode well.

So what happened to all those people who were interested in VR but who found Second Life to not be worth their time?  Many switched to Second Life’s greatest competitors, online games such as World of Warcraft, Guild Wars and numerous others.  Others turned to other areas of the Internet; there is surely no shortage of activity there.  Some… including once-active SL customers… simply returned to “real life”, fed up with Linden Lab policies and the instability of Second Life.

During this time, all the up-and-coming companies have been designing their products.  They are now poised to pounce.   Already VR environments such as HiPiHi are showing up, along with FREE online VR games that rival the graphics of anything SL has to produce.  Granted, most of these systems have limited or no building, limited or no scripting… but they are viable and stable… and they do not have the extremely high learning curve of SL.

That brings us back to LIVELY.  Lively is a (as of this writing) brand new item from Google.  It’s widespread, it’s hosted by one of the worlds largest and most well known computer companies… and it’s TOTALLY FREE.  That’s right, free.  No membership fees, no tier fees, no setup fees, free free free. 

On the SL blogs, most users had the same comment:  Lively sux.  Lively is nothing.  Lively doesn’t hold a candle to SL.   And you know what?  They’re almost right.  On almost every count. Comparatively to SL, Lively almost doesn’t stand up.  Almost.

But what a small handful of commenters noted, and what is absolutely true, is that most users of Second Life do not build, do not script, do not own land.   They are freebie users.  They chat, they dance, they buy L$ by the ton.   In truth it is they as well as the Premium users that keep Second Life afloat.  Why?  Because typically Premium users get to the point they don’t buy L$.  They earn L$ from sales, rentals, services etc, but they don’t buy on LindeX.  They primarily buy islands either for their own private use, or so they can run their malls, rent out land, and sell things to those that do buy L$.  Without people to buy L$, the land barons and merchants have no real reason to ply their trade.  Take out the free user quotient, and SL would undergo a virtual earthquake from which it just might not survive.

Lively should have Linden Lab shaking in its boots.   Because in truth, Lively is kinda interesting.  People can easily design their homes.  The avatars are downright cute (gotta love that pirate tiny).  The learning curve is nowhere near SL’s “spend 6 months just learning the ropes” monster.  I think SL users are biased and ready to disgard Lively as an amateurish attempt at VR, but news flash:  the majority of the population of the U.S. and other countries are not SL users… and they just might be attracted to the user-friendly and grief-free environment of Lively.

The very same people that are free users on Second Life, the ones who have no choice but to do their dancing and chatting on a highly unstable platform, the ones who sometimes are not allowed to log in because Second Life has “unusually high concurrency”, those who have to put up with lag and lost inventory and griefers and other goofiness… now have an absolutely free platform where they can EASILY design their own home, have their own virtual space, invite friends over, chat and dance to their heart’s content on a stable platform… absolutely free.  With cute avatars no less.  Most people, if they look good they couldn’t care less about building and scripting.

Sure, it’s not SL.  It’s no where near as sophisticated, no where near as versatile, no where near as flexible.  But it is free, universal, simple and from feedback thus far– it works.  Further, Lively can only go up from here.  Google had the good sense to START with a stable platform (at least so I’ve heard. Mind you, this is a brand new system.  More on that in a week or two as the feedback comes in).  Start with a stable platform, and you can just add bits and features here and there until your system rocks.   So people can’t build now?  What about in 6 months?  People can’t script now?   What about a year from now?  Lively can go wherever Google decides to take it.  What’s worse… Lively is not based on the Linden Lab software platform, so there goes LL’s dreams of ruling the market by licensing their technology to third party companies.  Google doesn’t need Linden Lab.  They’re quite capable of writing their own software, thankyewverymuch.

But that’s not what’s really scarey for Linden Lab.  What’s really scarey are the more than two dozen VR companies out there right now that are poised and ready to hit the market this fall.  And those don’t even count the top secret projects designed to directly compete with Linden Lab and do their very best to take over the market.  They have had a chance to watch LL, to observe the mistakes.  They’ve read the forums and the blogs and not being right inside the corporation, are able to clearly see the issues and where LL has failed.  This is known as the “BIG BLUE STRATEGY”, a philosophy used by IBM for decades now:  let the other guys design and make all the mistakes, then produce a better product and take over the market.  That’s how the PC came to be.  (Of course IBM made their share of mistakes.  Whole nuther blog).

HiPiHi is China’s entry into the fray.  It’s been in open, beta development for years.  HiPiHi is multilingual.  They know that they need both a Chinese and English version of their program if it’s going to catch on.  China also moderates their systems (an area where LL has failed miserably) and believes that users are responsible for mature and honorable conduct on their system.  You can bet China’s government isn’t going to allow kiddie porn and other illegal activities, even in a virtual world.  That should attract a lot of people who are sick-and-tired of constant griefings on SL due to LL’s historic failure to consistently and quickly handle such matters in a problem-solving manner and who are tired of the garbage, attitude-laden environment of mainland. HiPiHi isn’t likely to tolerate that nonsense.

Open Sim.  Now there is an eye opener.  Designed by users to be a direct clone of Second Life, Open Sim even uses the SL viewer.  Granted, it’s in infancy stages.  It’s laggy, it’s shakey (some would argue largely due to using SL’s Viewer), but according to programmers its development is actually ahead of schedule.  When it arrives, users won’t be consigned to paying Linden Lab ludicrous fees just to have a piece of virtual property.  If they want to… they can host their OWN virtual worlds.  If they are not so technically inclined, they can for as low as $75 a month purchase sim space that will grant from 25,000 to 45,000 prims… quite a bit better deal than Linden Lab’s $295 a month for 15,000 prims.  Not only that, but Open Sim has the potential of being the Internet of VR.  What kind of prices will develop when it gets rolling and competitive?  Sim hosting for $50 a month?  $25?  Free if you allow banner advertising?

Open Sim is the bulldog puppy.  If it remains healthy as it grows, it could very well be SL’s most damaging competition.   Evidence indicates that Linden Lab hopes to score by offering an “access license” to allow people to interchange assets (inventory/avatars) between SL and Open Sim regions.  But in truth, there are already ways to pull inventory from Second Life to other sims.  Programs already exist.  And in a year or two, why would anyone even want to?  They’ll have already been developing their own sims, new products, new scripting, new services, all on Open Sim, which will allow them to port such anywhere within the Open Sim grid.  That grid promises to be far more vast, far more stable, and far more flexible than Linden Lab’s current 20,000 sims.  It is very likely that the future of Open Sim will NOT be financially based as is Second Life.  With sim prices so low, people won’t have to sell things just to be able to afford a sim.  A brave new world could arise, freed of the contraining L$, land barons and high-priced merchant items (I mean really, L6000 for a skin?).  There’s nothing wrong with land barons (thanks for the rentals guys… free users appreciate it).  There’s nothing wrong with merchants (I love shopping as much as the next guy).  We just don’t want our virtual lives to be ruled and overrun by such concepts.

But with systems such as Lively (and who knows what else currently in development), Open Sim itself may be dead before it gets a chance to prove itself.  Lively pretty much took the computer world by surprise.  Very well guarded secret, all in all.  What else might be out there, ready to hit the market at any time?  A totally free VR platform with building and scripting, funded by advertising?  Woohoo!  Sign me up! 

We can only imagine what is about to hit.  Virtual Food Fight.  Fasten your seatbelts folks… it’s coming.  Oops!  Too late!  Already here…