Wednesday, October 10, 2007

Virtual Worlds Expo: State of Virtual Worlds Keynote

I'm going to be doing some live blogging from the Virtual Worlds Expo, going on today and tomorrow in San Jose. First up: keynote speech by Sibley Verbeck, Electric Sheep Company. His speech offered a "state of the virtual world" overview. I found it The tinteresting that he broke down the virtual-world world into age groups: kids, teens, adults.

Kids, he said, have the first virtual worlds market to become established and successful, with vws such as Webkinz, Club Penguin, etc. Large companies and major brands are marketing there, as well as sponsoring their own virtual worlds (Nicktropolis, Barbie, etc). Clearly those are here to stay. The users are spending money (or their parents' money), and there have been acquisitions, such as Club Penguin which was bought by Disney. Virtual Worlds have definitely been a breakthrough success as a entertainment medium for kids.

The next stage is the "multiply like rabbits" stage -- I predict a year from now we'll be looking at 40 virtual worlds for kids, all heavily marketed. This is great and sobering too because a lot of them won't be successful. We're beginning to see brutal competition as the early success attracts a lot of people coming in. Everything but the Keebler elf world, and maybe that.

Most interesting for the audience here is that it would be a mistake not to pay close attention to this even if you are not involved in kid stuff....this is where innovation is happening, and competition will focus on how do you make the user exprience work for users with short attention spans, which is everyone except early adopters who are already in virtual worlds. The kids' virtual worlds are also pushing the envelope to get a good user experience on machines that are not high-end.

Teen space is interesting, and perhaps only a step behind the kids' space....I would summarize the teen space as platforms that have taken communications that teens are already doing and then adding some virtual worlds components. Those are the platforms that are getting huge user numbers, such as Gaia and IMVU. These are taking things kids are already doing and adding value....we also see coming from virtual world side lots of other platforms taking the very deep 3D experience, such as MTV, and applying it to things that people are already doing and gradually adding on more virtual-world to it. One thing I'm not seeing there yet is a virtual world that does both of those things, that has all of the advantages that can be brought by a deep virtual world experience, along with self-expression and communication tools, such as profile pages and asynchronous communication. There are a lot of new platforms focusing on that as well. Clearly there are possibilities for a virtual world in the teen and youth space that could be a better acquisition candidate than MySpace.

The adult space is quite a bit further behind...I don't mean adult content, of course that's out there. But for an adult audience, a lot of experimentation hasn't even started yet. Adult users are *not* those with short attention spans -- the users that are there now are interested in investing a lot of time there. The long-term biz models aren't there yet, e-commerce and retail aren't there yet. In virtual worlds, every type of consumer shopping experience can be better than the web, though not better than in the real world. I'm not sure how long it will take but the time will come when there's more e-commerce done in virtual worlds than on the web. There's a lot of experimentation yet to be done.

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