How soon until The Donald joins Second Life?

So the Second Life avatar known as Anshe Chung — whose real-world equivalent is known as Ailin Graef — has issued a press release saying she has become the virtual world’s first millionaire, after accumulating property and other assets (custom avatar design, etc.) that are allegedly worth a million dollars, if they were converted from Linden dollars into real U.S. money. Valleywag is skeptical, to say the least.

As Valleywag editor Nick Denton put it in an earlier skeptical post, “Let’s be generous, and assume that the net worth estimate isn’t an outright lie; nevertheless, if Chung’s owner ever decided to liquidate those assets, their speculative value would evaporate. They have as much value as a large holding in a mafia-pumped penny stock.” He then goes on to criticize the gullible media for believing such tales.

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Of course, Nick — a former journalist with the Financial Times — must be aware that such credulity is hardly confined to reporting about virtual worlds. As more than one person has noted, reporting about rich celebrities such as Donald Trump is equally filled with hot air and credulous reporting, even from usually reliable sources such as Forbes magazine. All kinds of vague numbers are floated around about Trump’s net worth, which is almost certainly orders of magnitude smaller than he says it is.

The fact that liquidating all those assets in Second Life would demolish their alleged value is no less true when it comes to the net worth of Larry Page or Sergey Brin, for that matter. They couldn’t sell more than a fraction of the stock that makes up their net worth without cratering the share price. Of course, they can borrow against those holdings — something that, for now at least, Ms. Chung (or Graef) cannot do. More articles about her virtual empire here, and here.

Warning — Second Life geek alert

Like my occasional blogging nemesis Nicholas “The Prophet of Doom” Carr, I am fascinated by the controversy that has exploded in the virtual world known as Second Life over unauthorized copying of avatars and other objects in the game (which isn’t really a game at all, but let’s leave that for another day). Nick also wrote about it here.

To some, including my friend Stuart, Second Life is just a wacky, carnival-sideshow kind of place, where losers and shut-ins get to play dressup — something he and others often refer to as “Get A Life.” And there are definitely some weirdos in the world who need to put down the bong and get outside for some fresh air now and then (like there aren’t any of those on the Internet).

At the same time, however, Second Life is in many ways just a microcosm of real life, and many of the issues that come up “in world” (as the geeks like to say) are also similar, although they are often seen through the fun-house mirror that is the game. The current CopyBot controversy is a perfect example.

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As Second Life’s first “embedded journalist” Wagner James Au describes it, a program that can copy virtually any object — ironically designed by Linden Labs, creators of Second Life — has escaped into the wild and is being used to copy everything from furniture to people’s individual avatars.

Linden Labs, which discusses the controversy here, has said that the use of the copybot is a breach of the game’s rules, but for technological reasons it’s difficult (if not impossible) to prevent its use. There’s a great overview of the problem here, and a story by Reuters’ own embedded reporter here.

In many ways, the ability to copy anything is much like the ability to copy mp3 files or movies from the Internet. Someone spent time creating that content, just as people spend hours creating clothing, furniture, plants and houses in Second Life. How does a company like Linden try to protect people’s content but still allow the kind of freedom that makes the game an appealing place to “live?”

Linden says it is looking at Creative Commons licensing, virtual watermarks and so on, but no one has any definitive answers. That’s what makes it so fascinating.

Shopping moves into virtual worlds

Paul Hemp emailed me recently to let me know about a piece he wrote for the Harvard Business Review, entitled “Are You Ready for E-tailing 2.0?” In it, he talks about the moves by retailers such as American Apparel to set up virtual storefronts in the game Second Life, and how this could lead to an increasing amount of shopping taking place online, with friends meeting virtually to window-shop in virtual stores.

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According to the piece, Raz Schionning, who oversees Web marketing for American Apparel, says that

Visitors to the Second Life store often arrive in groups and seem to know one another. They typically talk about the clothes on display. They might buy something or watch the in-store videos. But they often end up chatting about unrelated topics, even as they continue to linger in the store—mirroring the activity at popular virtual clothing stores in Second Life, such as Preen and Dazzle Haute Couture.

I’ve written before — both on this blog and in a recent Globe and Mail column — about this idea, and how smart retailers and marketers like American Apparel and Adidas (and even Telus, one of Canada’s telecom companies) are making inroads into Second Life and using these virtual worlds for word-of-mouth marketing.

One of the things that got me to write about this phenomenon, in fact, was an earlier piece that Paul did for HBR, which was accompanied by a virtual conference in Second Life about marketing to avatars. I think Paul is definitely on to something.

Note:

In other Second Life news, Reuters is opening a virtual news bureau in the game, staffed by reporter Adam Pasick — who will appear as avatar Adam Reuters. His first piece was an interview with the head of in-world bank Ginko, and he said he plans to cover it just like any other developing economy or society. The bureau is here.

Is this the future of advertising?

I tuned into Rocketboom’s video-cast on Friday because they did a segment on the New York City Live Window event — in which Versu Richelieu (otherwise known as Kess Quinn) is sitting in a store window for 72 hours, building an exact replica of her surroundings in Second Life — and it struck me that this looks very much like the future of advertising (or at least a possible future).

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Intel sponsored Versu to sit in the window and also paid however many Linden dollars it cost for her to build what she’s been building, so they get all kinds of publicity out of it, and Linden Labs gets lots of publicity for Second Life too (although they had to take the world down during the event to block an “exploit” of some kind). Even Versu gets some publicity for her SL building skills, and so does virtual PR firm and event host Millions of Us.

Then when I watched the Rocketboom episode, I saw a different kind of ad — host Joanne Colan, who started the segment interviewing Versu as an avatar in the game Second Life, shows up dressed in a Borg costume from Star Trek and does an ad for a battery recycling company. Is this the future for video-cast advertising? It just might be.

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It was kind of cheesy, and I don’t know whether it crosses some boundaries to have the host doing ads in the middle of the show, but then we’re not talking about Ted Koppel either, let’s face it — and shows like Texaco Star Theater with Milton Berle in the early days of television weren’t all that different, really. Also interesting: Andrew Baron of Rocketboom, Joanne and the advertiser all show up in the comments on the episode.

Things get busy in Second Life

Herewith, a roundup of recent Second Life-related news events, as the virtual world continues to get more “real” (for better or worse):

  • The Economist has a long piece on Second Life, including a fascinating tale of a psychology professor who set up a place in Second Life where his students could experience something akin to schizophrenia firsthand.
  • Professor Charles Nesson of Harvard Law School recently held his first class in Second Life as part of an online-only course called “Law in the Court of Public Opinion.”
  • IBM recently held an alumni meeting on the island it owns in Second Life.
  • CNet has launched a presence in Second Life which consists of a virtual replica of the company’s offices in San Francisco, where the news agency says it plans to interview both real and virtual people.
  • A Swedish online dating company has made the natural leap from dating site with photos to Second Life dating world with avatars.
  • Scottish girl-rockers The Hedrons are the latest to put on a virtual gig inside Second Life.