Real vs Second Life

A prelim to the Relationship Economy is Second Life virtual world of animation and avatars. Business Week Virtual World this month reports. Second Life is a 3-D virtual world entirely built and owned by its Residents. Since opening to the public in 2003, it has grown explosively and today is inhabited by a total of 8,678,151 Residents from around the globe. From the moment you enter the World you’ll discover a vast digital continent, teaming with people, entertainment, experiences and opportunity.

You’ll also be surrounded by the Creations of your fellow Residents. Because Residents retain the rights to their digital creations, they can buy, sell and trade with other Residents. Alyssa LaRoche is rolling in Linden dollars, the hard currency of virtual world Second Life. Sure, the money is digital, but it can be exchanged for real U.S. greenbacks, or any other currency for that matter. “Everyone [in Second Life] is a luxury consumer,” says Reuben Steiger, CEO of virtual world marketing consultant MillionsOfUs. “Very few people go into a virtual world and decide they’re a hobo.” Even virtual hobos wouldn’t have it so bad, since in Second Life having bread on your plate and a shelter over your head are hardly essential. Bumming around in a virtual world is fun for some, but the vast majority of Second Life residents buy and sell user-generated goods and services, and keep their pockets stuffed with Linden dollars.

Virtual currency is bought and sold on Lindex-a currency exchange Web site where users buying in are automatically hooked up with users cashing out. Last February more than $5 million (that’s Uncle Sam currency) changed hands on Lindex alone. Like real-world currency, conversion rates fluctuate with the economy-as of this writing, $1 is worth 267 Linden dollars. And just like in real life, if you’re a connoisseur of luxury goods you need to have a fair amount of dinero. In Second Life, there’s evidence of some big spenders.Last March more than 800 users spent over 1 million Linden dollars, or about $4,000. Ailin Graef, the virtual real estate mogul (see BusinessWeek.com, 5/1/06, “My Virtual Life”) who last November claimed to be the first Second Life-made millionaire, says there is a market for high-priced, high-quality design in homes and other virtual commodities. “There is no real upper limit when it comes to people spending money on art, self-expression, and uniqueness,” she says. The highest-priced home in Dreamland, her popular residential community in Second Life, goes for about $420. However, she says some “well-off individuals” have paid more than $10,000 for virtual properties

Status Symbols Merely living in a big house or wearing a fur coat isn’t enough to stand out from the crowd, so the top spenders look for items with meticulously programmed designs, textures, and animations. Even though Second Life residents can fly from place to place rather than drive, cars are a popular and cheap commodity-you can buy Scions and Pontiacs for about $1. But an avatar that went by the name of Francis Chung brought to market the Dominus Shadow, a retro two-seater created with painstaking detail both inside and out. At about $40, it’s the most expensive car to be sold in Second Life and an envied status symbol among residents.

Real World Infiltration In my post titled Relationship Economics: Part 1, http://jayderagon.com/blog/?p=84 I describe a slightly different virtual space based on real world trading and interactions with real people, not avatars. Second Life is the prelim to “My Life” and all the technological factors are adding up and emerging fast.

Are your ready to be at the top of this breakthrough? What say you?

Jay is one of the few really deep-thinkers about both the socio-cultural implications of social networking as well as the practical business application across a range of industries and sizes of business. Jay challenges me to “up my game”.” July 21, 2007 Scott Allen, Coauthor, “The Virtual Handshake: Opening Doors and Closing Deals Online”, TheVirtualHandshake.com

Mr. Deragon is consider one of the leading experts in the emerging market of social networking market. He has studied numerous platforms, features, functions and the markets behavior. His analysis and findings conclude that this space has tremendous potential for individuals, companies and entire industries. There is an art and science to social networking that requires constant learning as the market matures. To read more about my discoveries and findings check out my blog.

Mr. Deragon was previously Chairman of XSVoice, a mobile application company that provided technology for live and on demand audio broadcast to mobile devices. See http://www.relationship-economy.com

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