A Failure to Disrupt: Why Second Life Failed

January 14th, 2011 | Posted by iggy in The Rebel Yell

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Am I being premature? Second Life has outlived its many obituaries.

This is not an obit. At the same time, only the most ardent SL-cheerleaders would deny that the virtual world has stagnated. In the case of education, I expect no more than a gradual decline in participation.  Other worlds await us, and many of them are linked together and provide content. When I saw a noted artist from SL building in InWorldz, I knew something tectonic had shifted.

Why? Given that my PhD work was in the history of technological systems and public enthusiasm for them, I cannot resist a Rebel Yell on this topic. It’s taken a recent book, Tim Wu’s The Master Switch: The Rise and Fall of Information Empires, to convince me why Linden Lab failed to change the world. That was Philip Rosedale’s vision, if I correctly recall  the 2007 Rolling Stone profile of him.  The magazine pulled the story from its archives, but nothing really dies online, especially the sort of hubris behind this statement: “I like the idea of being a young Apollo. All marble. Like I’m made of stone.”

That is our Philip, quoted by reporter David Kushner.
Gone to his Head

I see two aspects of Linden Lab’s failure.

A Failure to Set Standards For Interoperability & Commerce

What the talented Mr. Rosedale failed to grasp is that the technology he brought to us was not godlike enough; it disrupted little and, when challenged, its keepers failed to innovate but instead worked harder to sustain a market they’d drawn from The Sims Online players and other early counterparts, then cornered.

Had Rosedale a better grasp of industrial history, as Tim Wu has in spades, he’d have seen the difference between what Wu calls disruptive and sustaining technologies. The former destroy whole industries while creating new ones and setting standards: the telephone ended telegraphy. The latter sort of technology continues the dominance of a current system: pricey SUVs kept Detroit in business for a few more years, AT&T Princess Phones hooked teenage girls on an existing technology but did nothing to change the nature of telephony. Something like Skype could, in theory, have ended telephony as we know it.

The Internet itself is, unsurprisingly, an inherently disruptive system of technologies. Just ask anyone still working at a record store, book shop, or newspaper.

The problem with a system controlled by a monopoly or small group, Wu contends, is that such control can deliberately hinder innovation. Researchers at Bell Labs, AT&T’s research firm, discovered magnetic tape and built a working telephone answering machine in the 1930s. AT&T suppressed this because management feared that recorded conversations might erode confidence in privacy and lead to less use of the telephone network. AT&T, a tethered and regulated monopoly working with the approval of the Federal Government, lacked the vision to see that the innovation, marketed well, might bolster its profits by creating new markets and needs beyond real-time voice.

Linden Lab is no AT&T of 1931, or even 2011, but it tried to act that way prematurely.

For a shining moment from 2005 to early 2007, about the time my avatar rezzed in world, Second Life was a media darling. Every brick-and-mortar business wanted an in-world store (without considering why anyone would shop there). No other virtual world could compete, and even as other grids developed from the Lab’s momentary generosity with its server code, Linden Lab could cheerfully pat them on the head and say of these spin-offs, essentially, “that crayon-drawing looks nice, kid.”

As management changed and OpenSim worlds evolved, offering pricing and features SL could not, however, some early work in interoperability ended. Thus the Lab pulled its version of AT&T’s blunder, but it did so before it had really set a standard: the Lab squashed an innovation from within that it could have dominated and developed.

These guys should hire more humanities types, ya think?

There are many precedents for customers and industry in such ham-handed actions. In the case of magnetic storage, Wu shows how it came to American shores not from AT&T’s Bell Labs (where it languished in censored research and buried memos) but from German firms. And it came decades later than it might have done. But Linden Lab did not have decades to dominate. In the era of broadband and ADHD media, it had a year.


Now OpenSim grids offer interoperability, and we’ll see some clever entrepreneurs develop features such as integrated social media, robust functionality on mobile devices, and an inter-grid marketplace.

So instead of becoming disruptive, Second Life’s new features were sustaining their temporary monopoly, with even voice offering little that a Skype connection could not.  Web-on-a-prim should have come years earlier, and it would have constituted a real step toward a “3D Internet,” a promise of Rosedale’s early and Apollonian days in SL.

The same is true of the Lab’s failure to make the Linden Dollar and SL Marketplace the de facto standards for all SL-derived worlds.  Linden Lab once had the market position and, key point, media spotlight to convince content-creators to license products for multiple grids. It also had enough respect for its currency to offer Linden exchanges outside of SL’s grid.

The lack of such a marketplace and currency-of-choice is temporary. Thomas Parke Hughes, an historian known for his scholarship on the rise of the electrical networks, refers to such obstacles to technological progress as a “reverse salients.” These may hinder forward moment much as a stubborn fortress might in an army’s line of march. Eventually, they are overcome, like Constantinople’s walls, or bypassed, like the Maginot Line.  I see no reason why, given the financial incentives for building an inter-grid market, that this salient won’t vanish like most others in the history of technology. This could have been an easy win for Linden Lab.
June 2010 Road Trip
But in both the case of interoperability and commerce, the Lab did not act. Instead they made the garden-wall around SL taller and thicker.

I am no insider to LL boardroom politics even third-hand, but I sense a failure of vision and a desire to stick to Rosedale’s Snow Crash ideal of making one big Grid, not a constellation of grids with a common currency, marketplace, and means of transportation.

We educators will live amid and build upon the rubble of the Lindens’ failed vision.

A Failure to Make a 3D Web

A virtual world with rich integration of Web resources would indeed be disruptive. Imagine an SL with a Unity-style client having been launched in 2007. Imagine the client bundled in every release of Firefox. We might meet mom and pop via our browser do more than exchange photos or status updates. If it were easy enough to use, we’d convene to race Formula-One cars we designed ourselves, or we’d play volleyball. In theory and with a better physics engine, SL had that potential.

Such environments could, for instance, replace current social networking. There are advantages to embodiment online, since we are wired as biological entities to react to other people in certain ways one does not see in the 2D world of a teleconference.  And I’m not just talking about cybersex.

A 3D Web experience could lead to, say, Amazon’s online bookstore yielding to a 3D one where virtual books could be perused as easily as one scrolls through an iPad or Kindle. As one browsed, reviews could be checked with a click to invoke a virtual copy, fellow customers chatted up real-time about their picks, and more. Second Life would be about selling the experience of buying books, not just making a fake version of a bookshop rezz online.

Experience is what occurred in Snow Crash‘s Metaverse, and to switch screens would be doing what Stephenson called “breaking the metaphor.”  On my imaginary 3D Internet, a Kohler customer could import a 3D mockup of their home to the grid, then rip out the kitchen and bath. Next, Lego-style, they’d plug in mesh items from Kohler’s in-world store. That would indeed be different from what companies like American Apparel tried in SL. In fact, with augmented reality and new projection devices, in-world objects might be projected into the actual living space. Here’s an SL ad from an alternative version of the year 2011:

Want to see what the IKEA chair looks like, Tyler Durden, in your swank living room? Put this IggyO Industries™ RLRezzer™ on the floor, then from your iPad’s Metaverse-Hopper app, click on the items your avatar just tried out in Second Life.  Don’t forget that you cannot sit on the hologram! Paypal and InterGridBux accepted!

Back to actual 2011 a.d.: Linden Lab failed because it did not think far enough outside the prim.

Will we ever get a 3D Web? Unlike routine vacations to lunar hotels, where the incentive may exist, the costs are not prohibitive and the infrastructure exists. I presume the Net Neutrality will continue and companies like Verizon and Comcast will be constrained, under FCC principles for Common Carriers, to act according. If not, other nations with more enlightened policies may build the next Internet. Like the Interstate system, it will transform daily life (and not in always wonderful ways).

June 2010 Road Trip

Whoever builds a 3D Web, I doubt that Linden Lab will be more than an historical footnote in e-texts about the next era of information technology.

The hour is past for them. Today I demo’ed our OpenSim build of House of Usher to the folks from our Digital Scholarship Lab. All went well with lag, rezzing, scripts, etc. When I mentioned that our campus has left SL, however, I got a telling reply from one senior technologist.

With no irony in his voice but with all the flatness of established fact, he changed the subject by saying, “Well, no one talks about Second Life anymore.”

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13 Responses

  • Jason Shipley (mimetic.core) says:

    Excellent post! You nailed so many aspects of what has gone and is going wrong with SL on the head. The whole situation is very sad for people who were there during the twilight years but as we all move into the greener pastures of OpenSim and the likes, we’ll have retrospect as a tool rather than a regret. Thanks again for your thoughtful words. Now I must go read that book myself…

    jason (.core)

  • I could not agree more, especially when it comes to education. I left SL last year for the immersive education grid where I got free OpenSim land, and other education virtual worlds and learning games. As far as education is concerned I think the non-profit consortium of educators behind immersive education have it right and linden labs is clearly a business that has it ‘wrong’ (for educators). Just seeing the 2010 in Review that the immersive education group published this week at http://members.ImmersiveEducation.org cements my belief that open virtual worlds are the only way to go for long term education. Quite frankly, I am relieved that something like this exits as an alternative to SL.

  • Update of sorts: SL competitor Blue Mars, Avatar Reality’s virtual world with user-generated content, will switch to a mobile application that’s reported to be “avatar dress up” without any real “world” to it.

    That’s sad for the Ball State folks who have a city there. While exisiting content won’t vanish, the PC version will remain but not be updated beyond bug-fixes. Users are interpreting this move as an attempt by Avatar Reality to salvage investment and bring in users; the user base for the world never grew very much.


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  • Great post!! You nailed it as someone said….

    And I hope someone make a web version of open Sim, inWorldz and SL and likewise. Its the only way to attract “normal” ppl in larger numbers.
    In the future, for example, im certain we are going to be able to buy clothes and a lot of stuff via 3D web. Just make your avie with your exakt meazures and then try on the clothes. Ideal for shopping.

    Blue Mars was a virtual world i never felt any interest in. I just read about it, never registered, and I understood it was not for me. It was too fancy. I wanna do my stuff myself and not just play around in a vw as a barbie doll. It got too complicated for the normal user im afraid….

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  • Great line “Back to actual 2011 a.d.: Linden Lab failed because it did not think far enough outside the prim”

    For me I have not written secondlife off yet, as they still have the essentials for todays web, a critical mass of users though the numbers may be disputed , who are in themselves consumers and creators of content.

    My personal thoughts are when there were seismic shifts in web usage between 2008 – 2009 and issues such as transparency IP rights, came to the fore, and more specifically big changes in technologies and workarounds concerning web interactions, the Lab should have realized the way forward was to great a leap to go it alone and should have drawn on their very talented users who coincidently were not just there because of secondlife, but could see 3D web and all it would bring to the future and wanted to be part of the discovery process.

    Instead we all got vague promises of collaboration under draconian NDA’s which left a bitter taste in the mouth.

    They have breathing space until some bright spark hits the jackpot with the grail that is worlds and spaces transportable across all platforms content and all, and they yet may pull it of with the right collaborations and joint efforts it will take to transform secondlife into that grail.

    Just my humble opinion.

  • Pathfinder says:

    It will be interesting to see what Linden Lab does next. Personally, I think the future involves interconnected and open virtual worlds. That’s the way the web evolved. Walled gardens cannot compete with such paradigm shifts. I think it would only be in Linden Lab’s best interest to start exploring ways to interoperate with other grids. So I hope they do just that.

    From the article: “We educators will live amid and build upon the rubble of the Lindens’ failed vision.”

    I prefer a different metaphor. Don’t forget that Second Life was the catalyst for Opensim and Hypergrid. The lightning of Second Life struck a tree, gave people the gift of fire, which they are now taking to build their own campfires all around the world. 😉

  • Path, you have a better way with metaphors than I do. Yes, that’s an apt one, because w/o SL we’d not be working in OpenSim.

  • To paraphrase Twain, “The report of SL’s death is an exaggeration.”

    Over the years that I have been in SL (since June ’06), SL has continued to improve and develop as a deliverer of virtual world services. I can’t recall the last time the grid wasn’t accessible, and things such as the infamous “grey goo” are but memories. While there have certainly been technological hiccups along the way, the truth is that much of the complaining about SL from a technological perspective is that it hasn’t been developing fast enough, has made promises it wasn’t able to fulfill or has put someone’s technological wish list item over another.

    Linden Lab’s failure, in my opinion, is one of business acumen. Quite simply, how can money be made by operating a virtual world? Don’t underestimate the scope of the problem as many of the web-based commercial entities have the same issue. (How does Twitter make money, for instance? Answer: it doesn’t. It survives on venture capital.) If Linden Lab can be criticized as a business entity, it should be for its placing its original operating philosophy of “Your World, You Build It” over the more commercially proper “Our World, You Build It” and for giving price breaks to educational facilities. Linden Lab simply needs to pay more attention to its bottom line.

    Second Life will continue to survive as a commercial entity for the time being because there is simply no alternative. At the present, neither OpenSim, the HyperGrid, nor the “captive garden” standalone private grids have the technological capability, user base or grid stability necessary to be serious players in the creating, operating and maintaining of a commercially feasible virtual world. I have accounts on many of them and am a proponent of them as some of you well know, but I continually return to Second Life. Why: because it works AND there are people there. The question, as I see it, is: how can SL improve its commercial viability?

    I am certainly no expert in this area, but it seems to me that there are really only seven ways that SL can make money:

    (1) Charge for admissibility to all or portions of the grid on either a flat fee or tiered approach;
    (2) Take a percentage of each in-world transaction (e.g. a “sales tax”);
    (3) A property tax on owned land (which it now does as “tier”);
    (4) Take a percentage from the currency exchange to and from Lindens (as it now does);
    (5) Charge for rezzed prim usage (the prim being the essential utility of SL all users consume)
    (6) In-world or in-UI advertising by third-persons (e.g. ads on the coveted login screen and in your search box)
    (7) Charge for in-world listings in search (which it does now in certain categories)

    Perhaps someone else can think of another method, and by all means suggest them, but that’s all I’ve been able to come up with. I am sure that someone reading this will take issue with one or more of them (“Pay for prims used? Are you serious?”) but the purpose of this is to identify ways that LL could make money, not how they should.

    Since I’m already outside of some readers’ good graces, I’ll go ahead and suggest that LL do all of the following–each one guaranteed to rise the ire of someone:

    (a) Send out a notice that all non-premium accounts not logged into once every ninety days will be deleted. That will not only free up server side assets but also allow LL to provide a truthful and accurate picture of its user base for use when marketing SL as an advertising platform to users. Don’t underestimate the value of an ad on the log-in screen. Users with alts will simply have to log in with each one every ninety days to keep it active.

    (b) Make point-to-point TP a paid service rather than available to all. It can be included as part of a premium package, but all other users have to pay L10 for the privilege of TPing to a specific point on a sim. Those that don’t want to pay get TP’d to the sim’s TP Hub located in the center of the sim. That will drive all traffic coming into that sim to a central point and additional tier can be charged for the parcels adjacent to the TP point as they will become prime commercial property. That would also have the tendency to drive residential property to the outside of the sim which would be akin to the real world’s zoning ordinances.

    (c) Slow the addition of new land being added to the grid and instead focus on reducing the amount of land available. Decrease supply equals increased demand, which means property rates should start to increase. At the same time, do an evaluation of land use and determine how vacant or abandoned parcels can be eliminated or consolidated across a sim or even the grid.

    (d) Require a credit card for all new accounts, even basic accounts. The days of the mad rush into SL are over. By having a credit card authorization you ensure all accounts are linked to a real person who has the ability to spend money in-world and would make age verification automatic.

    Just some thoughts. Now, bring out the tar and feathers! 😉


  • Niko, no tar or feathers. But some of the charges, such as for TP’ing, would alienate so many in the user base that they’d be in InWorldz inside of 5 minutes.

    One other qualm with your remarks: InWorldz, that other private walled garden, has enough critical mass to be called a community. It’s a serious rival to SL, but it is also not open to the Hypergrid, so that kills it for me as an educational venue.

    I don’t know about your other suggestions, but LL misses the BIG money by not trying to set a standard for how we use virtual worlds (inventory and money across grids). The history of technology, in every case I can think of quickly, shows that those who set the standards change the world (for better or worse).

    And setting the standard on desktops made Microsoft rich and setting standards for hand-held devices hasn’t hurt Apple.

  • I like NIko’s take on things. I have a couple of points to make. First, all the discussion about 3D Web and building lifelike settings in VWs is for me rather far off the point of virtual existence in the digital world. The truly disruptive break comes not with representations of our physical-world lives – the cars, the furniture, the toys, the offices – but with the mappings between our mental spaces and the vast virtual universe. What are these mappings? Our brains contain amazing information-processing potentials we struggle to understand or represent in physical terms: multidimensionality of knowledge, novel portrayals and correlations of data and relationships, mythic associations lacking physical referent, and much more I can’t even find words for. We appear to be standing at the border of the unknown land of our imagination, and it scares us so much that we want to make a humanoid avatar that sits in a comfy chair in a cozy office. My own work in SL tries to grapple with some of these issues. I just don’t care about all the maps between houses in RL and houses in SL.

    Second, making money always tries to trump everything else, and in doing so always screws everything else. I’m not making money in SL. I’m losing money there. But what I’m gaining is priceless: the beginning gleams of comprehension about where we can take all this, no matter which VW we enter. For me as an artist and technologist, this stage resembles the emergence of abstract art from the futile ashes of the 19th-century classicists. That emergence transformed art, perception, and the scope of the human view itself. Second Life, along with all its counterparts, is in the midst of a similar and far more disruptive emergence, and we are far from done. I do my builds, I make my graphics, I spawn my scripts and my writing inworld, and I travel in a monstrous, amazing, limitless mindspace made accessible by Linden Labs and OpenSim and all the others. I will happily pay for that. If it goes away tomorrow – and every build goes away sooner or later – it will have taught us much we need to know. That’s indeed priceless.

    If you’re curious, here’s a SLURL to my build: http://tinyurl.com/46yufaa .

    – Jeddin

  • Hi, good summary of what’s not been going on. thx.
    I imagine people will be talking about the “why” for years to come..
    …and while I agree that SL is not dead yet, it has given away 2 or 3 years of lead to the other grids. My second Rezzday in InWorldz is a fortnight away or so…

    When you think how fast some things develop, 3D worlds have been quite slow… nothing much has happened in the last 4 years, windlight, sculpties, voice.. …..cool… but I think we are ready for more.

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