THOUGHT (aka Centric's Blog)

You get used to what you see. It’s a fact. Walk down the same five city blocks everyday, and they become invisible. Live for years in the same house, and you won’t see the architectural details that visitors will notice in 60 seconds.

It’s like that with virtual worlds. You get used to them. And so, you can drop into a cool new location in Second Life or HiPiHi, and say, “wow, this looks really good”–without also thinking, “given the limitations of the platform, of course.”

Let’s clear something up: this post is not about Second Life or HiPiHi bashing. Because both of those worlds are already in existence today, hosting lots of avatars today, and people are building things in them today. VastPark isn’t there yet.

But. Wow.

I was treated to a demo of VastPark by Bruce Joy, the founder and CEO of the company. And. Yeah. Wow.

It has shadows. It has physics that work, and look convincingly random and fractal. It has a sense of size and drama. It has avatars with a POV camera that is buttery-smooth and almost hyper-real. The textures are beautiful. And the scripting language seems to be efficient and easy to use (my tech credentials have long since faded into my past, so don’t hold me to this.) And did I mention it has shadows? Like, you know, those things that are cast when a light source is nearby.

Let’s get a little deeper. Apparently, VastPark is also modular. Their Creator application is in beta, which allows you to put together virtual worlds. There will be a Client application as well. The functionality of the Client and Creator applications can be remixed, so you can deploy a Client-only world (no building by those pesky residents, oh no, you know, they might want to make genitals or something), or you can add functionality from the Client to the Creator to give residents the ability to build whatever they want (because you are enlightened, and know that the more power you give your residents, the more successful your world will be.)

And . . . if MetaWSS works the way they say it will, this could be a game-changer. Imagine, instead of sending the prims (or the mesh) and the textures to the client, you send a description: “bottle123a49c” or something like that. The client can then decide to pick a super-high-res mesh of the bottle for display on a high-end PC, or a lower quality mesh to display on a 3D client that works within a web browser, or even a cartoon 2D model to display on a phone.

Are your socks still on? Mine aren’t. Vastpark has huge potential. Watch these guys in the future.*

*Some restrictions apply. Of course, I didn’t see this running with tens, hundreds, or thousands of avatars. I saw a limited range of demos. I saw only the Creator application. Not the Client. It only runs on PC (grr-gnarr-argh-&#W(&(&@^$@^#!!). All of this or none of this could happen. It may not play with the IBM-Linden-HiPiHi standards. It may be crushed by Google’s entry into virtual worlds. The pricing model they mentioned seemed designed to limit its uptake. And a meteor may land on Bruce’s head tomorrow. Or a meteor may strike the earth and make humanity extinct. I just report what I see, and this was pretty dang cool.

Yes, I know, I am a terrible person for mentioning the future of virtual worlds, then leaving you hanging. But would you rather read a blogpost or a novel? There you go.

The panel on the Future of Virtual Worlds was interesting. I shared it with a writer from CNet, a gentleman who has the task of building the largest virtual world project ever—in China, of course, and the professor who invented the MUD back in 1978. Yes, as in, he has been working in shared virtual spaces for almost 30 years. Text to start, yes, but shared spaces are shared spaces. The 3D is only the furniture.

It was funny, because there was this undercurrent of warning. Paraphrasing: “Be careful what we make virtual worlds into—if we eliminate the gaming and fantasy elements, then we may create a world that is stunningly useful, but in so doing, we can make it banal. We may wonder why people willingly spent 3-4 hours a night in virtual worlds today, 20 years from now."

And yes, I can see where this perspective comes from. I’d expect the first breakout virtual world results to come from one of two or three places, and the most likely one is in business applications. After all, we aren’t that far from a credible WebEx replacement in virtual worlds.

But if your virtual world is only for business meetings, how fun is it?

So if we get a big success in virtual worlds, and business rushes in to build its virtual worlds, do we kill what they could become?

Of course not. This single-track thinking is exactly akin to what happened in 1994-1995, when the internet first entered the public’s consciousness. Back then, many, many internet users wanted to Save the Intartubes from the Evil Corporations! While early web developers wanted to Pave the Way for Corporate Uptake! Both were single-outcome scenarios. Either the potential of the internet to unite humanity and give us unlimited opportunity would be destroyed by the corporations, or the internet would never become a valuable marketing medium.

Well, we know what we got. Both.

Today’s internet gives us opportunities unimaginable when I was growing up. I can talk for free to virtually anyone in the world. I can share my art with everyone. I can shoot video and put it on a network that has reach and engagement greater than any television network. In minutes, I can set up a blog with articles or stories that can be read from Tokyo to London. I can start an online business and immediately begin selling stuff. I can develop code, and build a company around it. And, at the same time, it is a corporate garden, filled with marketing.

So let’s not be so negative about virtual worlds, and about corporate involvement. It’s unlikely that today’s internet would have been what it was without the large corporate investments which drove awareness, uptake, and content. Virtual worlds need investment to drive awareness, uptake, and content—and that will drive the fun, creative, and visionary applications of virtual worlds at the same time.

“That’s great,” you’re saying. “This guy is a helluva politician. You haven’t told us one single concrete thing about the future of virtual worlds.”

Okay, okay. I’ll share some of my pre-conference notes on virtual worlds in the 2, 5, and 10 year timeframe.

2 years out:

• There are still a lot of different worlds, but we know who the gorillas are going to be
• There will be at least one major breakout, in terms of RL corporate $ sales, possibly coming from fashion or business enablers
• The line between social networks and virtual worlds begins to blur even more, with social networks moving into, or becoming, virtual worlds

5 years out:

• There will be at least a half-dozen major companies that have IPOed who started as metabrands
• We will have made major strides in quantifying an attention/propagation economy balanced by a widely-accepted reputation metric
• We will have some businesspeople using AI-backed avatars as proxies, extensions of their “real” self. Don’t talk to me, talk to my avatar—and convince it that I should talk to you. Formulae for “getting past the avatar” will be the new SEO of the day.
• Several purely user-created storylines in virtual worlds have now spread out into the real world, becoming linear movies, television/mobile series, comic books, and novels
• We’ll see the first wear-it-always augmented reality overlays (eyePods) and inexpensive, compelling immersive interfaces for entertainment and gaming

10 years out:

With accelerating change, the next 10 years may have the same amount of change as the last 20. In 1987, computers had 80286 processors struggling to display 16 colors at 640 x 480 resolution, cellphones weighed 20 lbs and were carried on shoulder straps, fax machines were thousands of today’s dollars, and there was no Internet as we know it. It would be difficult to explain the most basic concepts of a world-spanning data and communication network, let alone the fact that the largest “television” network consists of short user-generated video shared on it. Heck, you’d have a hard time explaining that the USSR was gone. But hey, here’s a shot at a couple of things:

• By this time, the virtual world revolution will be larger than the internet revolution at its 10 year birthday
• AI may be good enough to have our avatars stand for us
• We may have made significant progress in “uploading” personalities into virtual spaces
• We may see breakthroughs in personal fabrication, leading to a design economy/near post-scarcity economy
• The propagation/reputation economy may be the de facto standard for marketing and transactions—to the point where some people make all their money by sharing

If you want the complete scoop, IM Fallon Winnfield in Second Life or JasonS in HiPiHi.

Okay, it’s nice to be home from London. Actually, it’s not. I really do like London, and could easily live there. Lisa, of course, would insist we still have a flat . . . er, condo . . . in Hollywood, but it could work.

Why was I in London, you ask? Well, I was at the Virtual Worlds Forum. I presented on ROI in Virtual Worlds, participated in a panel on The Future of Virtual Worlds, and was one of the mentors in X|Media|Lab London, where I talked with a number of extremely interesting people with fascinating ideas, including one who may have the answer to popularizing virtual worlds, a person who was asking about the world circa 2025, another who has just introduced an exciting new virtual world platform (see the following blogpost), and a firm that is interested in moving its 2D world for kids into the 3D space. There’s a lot of exciting stuff happening in the field!

“Wait a sec!” You might be saying. “ROI in virtual worlds? Aintnosuchthingforgettaboutit!” or “The future of virtual worlds? How can you begin to predict that?”

Well, I’d say that there IS ROI in virtual worlds. Yes. Today. Right now. Not in the way you can run a Google AdWords program, and say, “Wow, I’m paying $17 for an average $103 sale, so things are going great!” But it’s definitely more measurable, and probably more meaningful, than the ROI you get from your TV, print, radio, and outdoor campaigns.

Marketers love to say, “I got a $5 CPM." Meaning, they paid $5 to show an ad 1000 times. Of course, nobody may have seen the ad. It could have been a 2AM placement on the late late late late b-movie showing. Or a 4AM radio spot. Or an interstitial banner barely glimpsed as one clicks from theit MySpace console to their home page and back again. Good targeting for insomniacs, or people with extremely short attention spans.

But you can’t say. “X people watched that ad, and X people acted on it.” Except in terms of averages and anecdotes. All you can say is that the ad has been shown.

Virtual worlds are arguably more measurable than any other medium. Not only can we get the number of visitors, the time they spent, and the number who came back, we can measure individual user actions. Did they try that neat photo booth? Did they go under the waterfall? Did they take something? Buy something? All measurable. And you can even go so far as taking their avatar name and unique identifier, their UUID, which can be used to determine avatar creation date. This is a rich mine of information.

And it may be killing virtual worlds.

Why? Because the numbers are small. Tell someone you got 5,200 unique votes in 1 day, like we did with the 12avatars.com project, and they’ll laugh and say, “Yes, well, we ran an online contest where we had 52,000 votes in a day.”

When you probe a little deeper, though, things get interesting. Because those 52,000 votes in a day were done from a $1MM push through external media. And all those people had to do was to go to a web page and click a button. The people in 12avs weren’t driven by ANY promotional budget—the campaign was entirely in-world and pro bono, NO media spend whatsoever. And they had to vote in Second Life. On a very crowded 4-corner sim where it was hard to move around because of the lag. People had to spend minutes, or tens of minutes, just to vote.

And yet we had 5,200 votes.

Think about that for a minute. Against painful odds, 5,200 people showed up in a single day to vote in a virtual world. And that’s just the start. When you start looking past ROI, where ROI = “number of people who showed up” to what we call Return on Engagement, or ROE, the numbers start looking a whole lot more compelling. ROE measures much, much more deeply:

• Number of visits
• Number of individual visitor actions
• Total time spent
• Team or teams created
• Devices distributed
• Equivalent impressions (long tail media)
• Value of any mainstream press coverage
• Value of assets generated (vs photos, video)
• Value of the knowledge (vs RL research)

When you add up all of these results for 12avatars, and figure in the cost of our time (at typical agency rack rates), the return on engagement is actually quite compelling. If you’re interested in getting the full scoop on 12avs, just drop Fallon Winnfield an IM in Second Life, or JasonS in HiPiHi.

The kicker? ROE is only the beginning of the value model of virtual worlds. We’re working on a metric we call Attention Index, which could be a way to tie a virtual world campaign directly to exposure, in terms that large advertisers will understand. We’ll let you know more as we get out of the alpha stage on this.

International Coordinator Yuki Saeki and I have now relocated to Tokyo, and will be frequently traveling back and forth to China. Obviously, I have quite a few things to catch up on. If you have plans to be in Japan or China, please let me know. There’s a cold Yebisu or Tsingtao beer with your name on it.

October 10 and 11 - San Jose

I moderated a panel at the Virtual Worlds Fall conference in San Jose, California about the Asian market. Yuki joined in, along with our partner Naoyoshi Shimaya, CEO of Metabirds in Tokyo, writer Wagner James Au (Hamlet Linden), and Jeffrey Pope from Sun Microsystems. We fielded a variety of great questions from the audience before quickly running out of time.

Major lesson learned: Asia is a large, diverse region and a subject not easily summed up in an hour panel!

We met many fantastic people and companies working in virtual worlds and social media. Thanks to everyone who attended and stopped to chat with us.

October 17 and 18 - Tokyo

Yuki and I attended the Virtual World Summit in Tokyo, Japan last week and had a great time. There was a fascinating mix of educators, corporations, entertainment providers and developers present. It’s encouraging to see Japan getting so involved in the advancement of virtual worlds and new technologies.

Major lesson learned: You can never bring too many business cards to a Japanese conference!

Extending Partnerships

In addition to our ongoing partnership with virtual world developer Metabirds in Tokyo and our expanding partnership with the virtual world platform HiPiHi in Beijing, we’re finalizing details of a new partnership with 3Di in Tokyo.

3Di is part of ngi group, major investors in such exciting projects as mixi and HiPiHi. 3Di has recently released Movable Life, and announced its new open-source virtual world platform Jin-sei. We’re extremely excited about this partnership and how it will extend our work with Metabirds and HiPiHi — and will announce the details shortly.

Much more to come!

Today, at 5.30am GMT, Radiohead released their new album, In Rainbows, through download. By beautiful coincidence, that’s the same time when every RIAA executive suffered Sudden Bowel Reversal Syndrome when they realized they were good and truly screwed. That’s because Radiohead decided to let people decide for themselves what they’d want to pay for the tracks, even if that meant zero pounds and pence.

Now, this is more than Radiohead doing something novel because they can afford to. This is an excellent business decision because the band has recognized a few things that proponents of free downloads have been screaming at the tops of their lungs since Napster:

• nothing sells a product like the product itself
• treat us like customers, not criminals

Radiohead has shown they consistently create excellent, honest music that’s an expression of themselves as a band and as people. Art is about reaching out to other people and sharing a bit of yourself to the audience, and an audience will respond to that. That’s quite different from the excrement pushed out on the Top 40, where everything is manufactured within an inch of its aural life. It’s the difference between, say, an artisanal smoked Gouda and a can of Cheez-Whiz. Yes, they’re both cheese, but, dude, are you really going to eat that crap out of a can if you have a choice and if you know better? The RIAA is hoping you don’t know better and won’t ever know better, while Radiohead is quietly making cheese that will make your taste buds glad they exist.

What about the second point? Aren’t these tracks going to show up on torrent sites immediately? Of course, and the ripped tracks from the discbox (which will contain the downloads in a higher bitrate, two vinyl albums and a bonus CD) will show up as soon as the box ships. What will that do to Radiohead’s bottom line? My prediction: jack squat diddly, because the band trusts its fans and the general public. There will be people who love Radiohead who can’t afford to pay for the downloads, and there will be cheap bastards who won’t pay for the downloads, but I think most people will do just what I’ve done: "buy" the album for 0L, download today, give it a listen, decide what it’s worth, and buy the download for real. Personally, I think it’s worth ten bucks, about the cost of a iTunes Music Store album download. I’m going to throw in an extra dollar or two, by way of saying thanks for keeping the files free of all of the DRM baggage that iTMS chunks into their files.

Now, according to the album’s Wikipedia entry, Radiohead is shopping this album around for a traditional contract, but, as the band starts looking over the download stats for today and the rest of the week, I think they’re going to realize how good it feels to have liberated themselves from the record company system. They can reach out to fans on their own terms, and that means more creative control and more cash in their pockets. Yes, they won’t be able to sell their discs in Wal-Mart and Tesco, but, hell, are you trying to tell me that the potential Radiohead fan who’d buy the record there doesn’t have an internet connection? That they don’t know someone who has? That there aren’t little pockets of Radiohead fans throughout the world who will pass burned copies around? Please. The tiny cut the band would get from big box store sales is going to be buried under an avalanche of people sending them fivers. And where Radiohead goes, U2, Jay-Z and plenty of others will soon follow.

Nothing sells a product like the product itself. Treat us like customers, not thieves. Stick that in your pants, RIAA.

Yeah, yeah, back to the workaday stuff. But hey, some people actually want to see us. So here’s where we’ll be:

Ken Brady, Centric’s General Manager, Asia Region is speaking at the Virtual Worlds Conference and Expo on the subject of international virtual worlds. Look for him on October 10 and 11 in San Jose.

Jason Stoddard, Centric’s Founder and Managing Partner, Strategy is speaking at the Virtual Worlds Forum Europe on Thursday, October 25th, on the future of virtual worlds, and leading a strategic workshop for X|Media|Lab on Friday, October 26th.

Also on the slate is Jason Stoddard, presenting a workshop on virtual world technologies and GIS at Harvard in December. Stay tuned for more information.