Second Life: Boom or Bust?

Have you heard about Second Life yet? If not, you can do a search on it. Second Life is a virtual reality world, whose population reached 1 million a few months ago. So what's the big deal? World of Warcraft has 6 million users. Many people claim Second Life is the next big thing on the Internet. So much so, that corporations are starting to get into the Second Life craze. Toyota has set up shop inside Second Life, selling customizable Toyota Scions for $300 Linden dollars. Dell and IBM are following suit.

How much is a Linden dollar worth? Well, Second Life has a currency exchange where you can exchange real dollars for Linden dollars. (I personally think that is a bad financial move, BTW.) The odd/neat/scary thing is that you can also trade Linden dollars for real money. I believe 300 Linden dollars are (very roughly) equal to one US dollar.

A Linden dollar is also worth about 5 minutes of dancing at the local Second Life casino. (Oh man, don't ask.) Second Life is overrun with casinos as well as XXX content, so it's pretty much on par with the rest of the internet. While this represents the more shady aspects of Second Life, there is plenty of good stuff here too.

During my wanderings, I found a virtual medical library with feeds from real world data sources. Numerous organizations have set up conferences and meetings within Second Life. Some are looking into Second Life for it's potential in long distance education. I even found an amazing wedding chapel and an online couple that planned to get married there the next day.

This is all neat stuff, and when you read the news articles about Second Life, most of them come off as saying it's the next big thing on the Internet. I remain skeptical. I'm seeing Second Life as a Friendster or ICQ sort of thing. They were both pioneers and very popular for a while, but then they were surpassed by more successful enterprises. Right now, Second Life is getting a lot of praise, but I don't think it is "the next big thing on the Internet". It is perhaps one of the best pioneers of the virtual reality community concept to date, but I believe it lacks the polish to truly succeed long-term, mostly due to technological restrictions, and the fact that there were no ogres to kill for gold and experience points. (There has to be a better way to earn $L than dancing at a casino!)

If I still have your attention at this point, it's worth noting that Second Life is experiencing a housing estate boom. Owning land in Second Life is expensive business, as you can buy land in the game, but will be charged (in real money) a monthly fee depending on the area size you own. The people that run Second Life are discussing a fee increase (November 17th, 2006) because of the influx of corporations buying land and the creation of luxury private islands. Many see this as the beginning of the end for Second Life... while others claim it is just the end of the beginning.