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Second Life Virtual Property Boom

Zonk posted more than 8 years ago | from the a-little-plot-of-land-on-the-edge-of-the-world dept.

Role Playing (Games) 242

The Guardian Gamesblog has an interview with Philip Rosedale, Second Life's CEO and Founder. In the wake of last week's virtual property slaying, they discuss the realities of owning something intangible. From the article: "We launched Second Life without out of world trade and after a few months we looked at it and thought, 'We're not doing this right, we're doing this wrong.' We started selling land free and clear, and we sold the title, and we made it extremely clear that we were not the owner of the virtual property. USD$.4m a month is traded directly to world markets in Linden Bucks on Gaming Open Market. That's USD$.4m redeemed, or Linden Bucks turned into US dollars. In May 2005, the total amount traded in-world was USD$1.47 million. There were 1.3 million transactions between 19,500 unique users."

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242 comments

I have a bridge for sale (4, Funny)

nizo (81281) | more than 8 years ago | (#12827851)

Actually I have several dozen, in any shade that you choose.

Do you want to buy a virtual clock? On eBay now! (0)

Anonymous Coward | more than 8 years ago | (#12827931)

I'm a merchant in this venue. I sell clocks! Take a look! [ebayimg.com] I make about USD 50 each week. It's good spending money for any kid, just for having fun for about 3 hours a day.

Re:Do you want to buy a virtual clock? On eBay now (0)

Anonymous Coward | more than 8 years ago | (#12828087)

Gee, I think this clock reminds me of something, but I can't say what. Shame.

Intangibles always bust (4, Interesting)

EmbeddedJanitor (597831) | more than 8 years ago | (#12827947)

The reason we get things like dot.bomb is that all hype-fed cycles eventually run out of hype-fuel and the value needs to be underpinned by some tangible value.

In the case of dot.bomb we had a bunch of non-viable businesses and ideas with no effective business plan that could not stand up to scrutiny. Unfortunately a lot of other viable ideas/businesses got burnt too.

The same goes for pyramid selling schemes. While there are new suckers/members to join up and fuel the system everything is great. Once the sucker/member fuel runs out they crash.

I recall a business selling Kruger Rands about 15 years ago. A Kruger Rand is just a minted ounce of gold, so has the tangible value of an ounce of gold. This crowd, however made a business of adding an enhanced value based on the condition and minting marks, coining phrases like bloom, sheen etc. Some coins sold for 5 to 10 times their tangible value. Eventually this bust and many people got burnt.

Re:Intangibles always bust (1)

brianf711 (873109) | more than 8 years ago | (#12828482)

In your example, gold itself is a material valued more for intangible reasons, like shine, color, status, etc. I think the difference is that the market is larger and perhaps has critical mass so that it has never fallen flat. Even governments back their cash in gold. For tangibles, "I want to say one word to you. Just one word... Plastics."

Re:Intangibles always bust (1)

ColaMan (37550) | more than 8 years ago | (#12828606)

Even governments back their cash in gold.
Not anymore. It's all theoretical now, baby.
Or did you really think that there's enough gold in Fort Knox to redeem the entire US paper currency float?

Re:I have a bridge for sale (2, Funny)

Spy der Mann (805235) | more than 8 years ago | (#12827976)

Actually I have several dozen, in any shade that you choose

Yes, but do they run Linux? :)

Re:I have a bridge for sale (0)

Anonymous Coward | more than 8 years ago | (#12828083)

Not yet. NetBSD [netbsd.org], though, runs great!

Re:I have a bridge for sale (3, Informative)

eggstasy (458692) | more than 8 years ago | (#12828292)

This is not a scam.
Second Life is just like the web, but wrapped in a pretty 3D virtual world - it is primarily a place where you can create and host content for others to enjoy (and purchase).
Land is a metaphor for server space. The money you pay is for the server resources. There is a finite amount of them per server (65536 sq.m.)and if you want, you can even buy your own server. Some people own more than one! Even major RL corporations are starting to hit SL - if you're a student, or unemployed, you could get yourself a real job!
Artist? Programmer? Just plain bored? Join Second Life [secondlife.com] - I've been there for over two years and will never look back.
You can build just about anything out of simple geometric shapes and make it come alive with a powerful, yet simple scripting language that uses C/Java style syntax and an event-driven paradigm.
Check out the language reference and see for yourself! [secondlife.com]
Second Life even includes a full fledged physics engine called Havok [havok.com], which is rapidly becoming the industry standard.
It is truly a geek's dream come true, and no one on SLASHDOT of all places should dare criticize it - we have a whole section devoted to LEGO and SL is at the very least LEGO on steroids :)
Heaps of screenshots [sluniverse.com]

My pencil (-1, Offtopic)

Anonymous Coward | more than 8 years ago | (#12827855)

is long and yellow. FPMOFO,.

Too bad it lacks an eraser... (-1, Offtopic)

Anonymous Coward | more than 8 years ago | (#12827877)

...because it looks like somebody made a mistake!

Re:My pencil (-1, Offtopic)

Anonymous Coward | more than 8 years ago | (#12827885)

hi octalc0de!

retarded moderators (-1, Troll)

AnusesBaskets (891817) | more than 8 years ago | (#12827900)

so my comment is offtopic but the original post and other reply are not?

dumbass

Re:retarded moderators (-1, Offtopic)

I keep creating acco (892478) | more than 8 years ago | (#12827933)

the funny thing is that moderators waste points on criticism but don't mod down the actuall offtopic posts that started this thread.

god you retards are dense and moronic

Re:retarded moderators (-1, Offtopic)

jabber01 (225154) | more than 8 years ago | (#12827941)

Oh, the irony of you complaining about the virtual worth of your lame comment, on a website where nobody actually knows you. That's down-right artistic!

so.. (3, Insightful)

Turn-X Alphonse (789240) | more than 8 years ago | (#12827864)

So you give them money for land (Lets say 1 block) and they keep said money and give you this block of data.. then.... they keep your money and..?

This is one huge ass scam type deal, yet totally legal and ingenius. Even if someone goes "No thanks, I'd like to sell you the land back, can I have my money please" they still get the intrest in the long turn and make a profit.

It's like selling magic beans, either way they win..

Re:so.. (1)

cc-rider-Texas (877967) | more than 8 years ago | (#12827910)

Absolutely correct; its just another way to make a buck....and it reminds me of that old saying...there's a sucker born every minute...because you would have to be extremely involved with the game to actually spend money on virtual property.

Re:so.. (0)

Anonymous Coward | more than 8 years ago | (#12827911)

It's like selling magic beans...

Wait, so what you are saying is these magic beans I traded my cow for yesterday aren't worth much?

Re:so.. (4, Insightful)

BrookHarty (9119) | more than 8 years ago | (#12827965)

Its more like a Tax on the virtual land. The tax (monthly payment) pays for the servers needed to host your virtual land.

Now, your land could be in a highly marketable area, and be worth MUCH more than normal. Just like real land, location makes it more valuable. Waterfront, Adult areas, private location, no wierd neighbors. Of course, nobody is stopping you from buying your own server for a giant piece of land, setting up a community and leasing it out to people. Its done all the time, private clubs, etc.

I picked up a lot near a major building area, and had water front on 2 sides. Now, when I switched my account to free, I gave the land away to a friend, instead of defaulting it back to Liden.

Liden's cant give away the land, servers cost money, someone has to pay. They just figured out how to make it self sustaining by the customers, and then spin off the technology into other markets. They have developers to pay also.

I'm not seeing the sinister plot here....

Distributed multiplayer online games (1)

Rei (128717) | more than 8 years ago | (#12828086)

servers cost money, someone has to pay

P2P.

Of course, to prevent cheating, you have to have multiple nodes "managing" each region, and which region nodes are "managing" they should have no say over (assigned via kademlia, a small assignment server, or whatever; the IP must be the critical factor, however, so that the user cannot sign in and out to try and get new regions). Having multiple nodes managing each region increases the bandwidth involved as well, as the client has to verify that multiple (probably four, so that there's three even if one drops out) separate data streams are consistant, and commands need to stream out to those three nodes (the nodes further need to sync with each other occasionally). If controlling nodes drop below three, the region should be unavailable until a new node comes back on.

There are other complications as well. Machines may have their CPU/bandwidth capability change midway and have to be assigned a smaller region to manage (with other nodes having to take up the slack, but still not getting to choose what they get), etc. "Updates" and new regions would need to propagate on their own, but be signed by a trusted authority. Etc. However, it certainly seems to be a doable concept.

Re:Distributed multiplayer online games (0)

Anonymous Coward | more than 8 years ago | (#12828231)

However, it certainly seems to be a doable concept.
Good, you code it and make a good game out of it and make a ton of money. I'll sit back and wait for you to wonder why P2P isn't the answer to everything in existance.

Re:Distributed multiplayer online games (1)

Rei (128717) | more than 8 years ago | (#12828288)

Ah, if I had a quarter for every time a single individual made a modern game that made "a ton of money", I'd... hmm, I guess I'd be broke. Perhaps you meant to state something more realistic, like "you code a library that helps facilitate the above-described networking system between nodes in a distributed gaming environment"?

By the way, if you have a technical issue of concern, please raise it. If not, why are you posting?

Re:Distributed multiplayer online games (1)

eggstasy (458692) | more than 8 years ago | (#12828588)

SL can not feasibly run over a P2P system. It's geared towars realtime interaction so it's very time-critical, P2P overhead would totally kill it, plus end users do not have anywhere near the upstream bandwidth. The default settings are 300kbps, multiply that by the number of users you want to support... you have to realize that SL is streamed, no content resides on the user's machine other than a cache, it's all downloaded on-the-fly... just like a web page.

Re:Distributed multiplayer online games (1)

Rei (128717) | more than 8 years ago | (#12828658)

It's geared towars realtime interaction so it's very time-critical

That's a latency issue, not a bandwidth issue. If you have four servers that you're talking to and need to hear back from two of them before you can confirm the contents, odds are that at least two are near you.

The default settings are 300kbps

That's why I mentioned that bandwidth is a weakness of a p2p system (in some ways, not in others). It depends on what you're doing with the bandwidth at the time. If you're exchanging signed world elements, it's not a limitation, because if it's signed, you only need one copy, and you have multiple servers to get chunks from (ala bittorrent)

multiply that by the number of users you want to support...

No. You multiply by the number of users if you're using a central server; that's the key disadvantage of a central server. For a distributed serving environment, you multiply the average bandwidth load in a region times the maximum number of users in that given region, and if it's too high, you subdivide the region.

no content resides on the user's machine other than a cache, it's all downloaded on-the-fly

And hence the 300kbs bandwidth need :)

Re:so.. (5, Insightful)

TexVex (669445) | more than 8 years ago | (#12828036)

This is one huge ass scam type deal, yet totally legal and ingenius.
No, it's not a scam. They're trading value for dollars. It's also not ingenious, it's Economics 101. They couldn't do this if the virtual estate (as opposed to real estate) didn't have any value to the game's subscribers.

Game players have been trading the rights to pixels on eBay for as long as there have been persistent-state worlds. Sony is in an endless fight to keep EverQuest items off eBay so they can create their own service that does the same thing, while EA pretty much ignores Ultima Online real money trade. Now, Second Life has merely chosen to cut itself in on the action.

This isn't even a new business model. Magic: The Gathering Online does a brisk trade in completely virtual playing cards. There was a game before them called Star Trek ConQuest Online or something like that, which did the same thing and didn't even give you the option to convert a complete virtual set of cards into a complete real set of cards.

And, how's this really different from buying the rights to use a bunch of bits that make a song come out of your computer's speakers?

Re:so.. (1)

John Hurliman (152784) | more than 8 years ago | (#12828471)

In Second Life you're basically paying someone else's wage of playing the game. You get a monthly stipend, and bonuses for creating cool things in world that attract people such as clubs or flying saucers. You also create objects, clothing, whatever and sell it to other people who aren't talented in that field or can't be bothered to create it themself. I played for a summer and made about $200 profit, which calculated out to less than a dollar an hour but I wasn't playing purely to make money. It was just a bonus for cashing in all my stuff at the end before I went off to college.

Re:so.. (1, Insightful)

Anonymous Coward | more than 8 years ago | (#12828507)

Next you're going to tell me that pyramid scams wouldn't work if they didn't have real value to the participants...

Re:so.. (1)

Qzukk (229616) | more than 8 years ago | (#12828078)

So you give them money for land (Lets say 1 block) and they keep said money and give you this block of data.. then.... they keep your money and..?

So you give them money for a piece of paper, and they keep said money and give you this piece of paper, and then they keep your money, and?

Sounds like the stock market to me, I'm glad I'm not the only one who sees it as the "magic beans" it is.

Look son, I've developed it! (3, Insightful)

winkydink (650484) | more than 8 years ago | (#12827868)

When I read about "virtual real estate" I can't help but think of the
character who played Woody Allen's father in Love and Death and his
"valuable piece of land".

What's next? Virtual commodities trading?

Yes, I understand it's primarily for entertaihnment value, but somewhere
in Marketing (insert preferred afterlife here), a large group is laughing
themselves silly.

Re:Look son, I've developed it! (4, Informative)

mekkab (133181) | more than 8 years ago | (#12827930)

What's next? Virtual commodities trading?

I believe those are called 'Derivatives.'

Botched the link... (1)

mekkab (133181) | more than 8 years ago | (#12827968)

Ahem, Derivatives. [wikipedia.org]

From the link:
The fundamental nature of a derivative is that unlike a bond, as in a Treasury bond, or a stock, or even physical stock or commodity (ie: some raw material, product), a derivative has no physicalistic purpose or reason for existence.

In essence, you can make bets on commodities and futures; i.e. virtual commodities trading.

Re:Botched the link... (1)

Skippy_kangaroo (850507) | more than 8 years ago | (#12828112)

Physicalistic!? Wikipedia needs to get some better contributors.

Not to mention the fact that it is plain wrong. There is a very clear reason for the existence of derrivatives - people want to buy them and find them useful for managing risk.

Re:Look son, I've developed it! (2, Insightful)

mikael (484) | more than 8 years ago | (#12828626)

What's next? Virtual commodities trading?

Virtual eminent domain?

You find that your exclusive townhouse and neighbourhood only 5 minutes from the market has within hours, been moved 5 clicks North to make way for a new plaza, condos and hypermarket.

In other news... (3, Funny)

Anonymous Coward | more than 8 years ago | (#12827886)

virtual loser boom!

Re:In other news... (1, Insightful)

Anonymous Coward | more than 8 years ago | (#12827989)

Mod parent up.

Ditch the fucking "second life" and work on the first one, that is, the real one. People piss their lives away in their digital... phantasmagorias.

Re:In other news... (1)

Rei (128717) | more than 8 years ago | (#12828145)

Ditch the fucking "second life" and work on the first one

So says a person posting in the comments section of a geek-oriented website.

Re:In other news... (0)

Anonymous Coward | more than 8 years ago | (#12828215)

the matrix has you... bwhahahahahahaha

second life? (5, Funny)

tuggy (694581) | more than 8 years ago | (#12827887)

second life?
no thanks, i still have to get my first one!

Re:second life? (2, Funny)

IthnkImParanoid (410494) | more than 8 years ago | (#12828019)

Having recently gotten a first life, I must say it's not as exciting as people made it out to be. For example, there are no flying cars, and no quicksave feature. I really tried to like it, but until it gets some more features, I'll have to stick to Civilization III.

in soviet russia... (0)

nunodonato (791978) | more than 8 years ago | (#12827925)

in soviet russia.. virtual properties sell you!

Re:in soviet russia... (1)

Rii (777315) | more than 8 years ago | (#12828017)

In Red China there is no virtual property.

Mostly because in communism the government owns everything, har har.

Re:in soviet russia... (0)

Anonymous Coward | more than 8 years ago | (#12828095)

pssshh......in korea only old people use virtual property

Spelling...? (0)

Anonymous Coward | more than 8 years ago | (#12827949)

Was it just me or was TFA riddled with spelling and grammar mistakes? (Besides being rather boring?)

Sure, until they try to shut down second life.. (3, Interesting)

raeler (463406) | more than 8 years ago | (#12827959)

Just wait until they try to wind it down and suddenly the lawsuits start flying for willful destruction of property.

Isn't that the whole point behind MMORPGs NOT allowing actual ownership in-game? Since if there's a server wipe or something they have no obligations to the players to return all their houses/loot?

Re:Sure, until they try to shut down second life.. (1)

nizo (81281) | more than 8 years ago | (#12828012)

I figure they have a few options here:
- Make the servers slower and slower until everyone quits playing.
- Have a virtual asteroid wipe everything out (like the one that killed the dinosaurs, only not real).
- Make a horde of virtual lawyers that sue everyone until they own everything.
- Withdraw all the company's cash and flee to some country without extradition treaties with the U.S.

I wonder if any of these were included in their business plan as an exit strategy?

Re:Sure, until they try to shut down second life.. (1)

SavvyPlayer (774432) | more than 8 years ago | (#12828074)

Your option #3 would actually be quite viable if there existed in said mmorpg universe a democratic concept of justice, and a character with the following profile: charisma +20, law > +6 and alignment >= neutral-evil.

Re:Sure, until they try to shut down second life.. (1)

OverflowingBitBucket (464177) | more than 8 years ago | (#12828580)

I figure they have a few options here:
- Make the servers slower and slower until everyone quits playing.
- Have a virtual asteroid wipe everything out (like the one that killed the dinosaurs, only not real).
- Make a horde of virtual lawyers that sue everyone until they own everything.
- Withdraw all the company's cash and flee to some country without extradition treaties with the U.S.


There's an even more effective way of doing this without the nasty side effects.

No high-level content.

I spent a fair amount of time playing an certain online browser game with a stack of low-level content. To reduce the tedious aspects of the game I spent real-world money to purchase in-game items. I reached the majority of the in-game goals and then discovered that I was sensationally bored of repeatedly clicking the same thing over and over to earn in-game currency and left the game. I looked back and realised I had just spent US$60 on a web game that I had essentially discarded in the end. I then realised that it may have been their business model. Make a fun game with tedious aspects. Allow players to pay to remove tedious aspects. Gradually scale up the tedious aspects until the player quits. Repeat with new players.

Re:Sure, until they try to shut down second life.. (1)

Nasarius (593729) | more than 8 years ago | (#12828042)

Yeah, and what happens when [natural disaster] takes out their server + backups? It's a legal mess.

Re:Sure, until they try to shut down second life.. (5, Insightful)

Kesh (65890) | more than 8 years ago | (#12828105)

On the flip side, isn't paying for webspace on a server the same thing? You're paying for virtual property on a host, so that others can access that host and enjoy your creation.

If the webhost goes under, files bankruptcy, shuts down tomorrow... do you have any legal basis for a lawsuit? Just because they're not hosting you anymore?

Re:Sure, until they try to shut down second life.. (1)

nunchux (869574) | more than 8 years ago | (#12828232)

There's a difference here because if you're paying someone to be your webhost, you have the rights to the content on the site-- and if the hosting company goes under, or if you are dissatisfied, you can transfer those contents to another host. It's a hassle, but you wouldn't lose your content (assuming you're smart enough to keep a backup offline.)

Now when Second Life goes under-- and it probably will at some point, though it could be a year or two decades from now-- your investment in their "land" and "property" is gone. It's not like you can carry it over to Everquest...

Now, I don't know the terms of the Second Life contract (if any) or what backup plans they might have if the project is no longer profitable, but if hey have any sense there's a provision that protects them from damage claims (and I wouldn't blame them if they did.) If it's a success, it will probably be bought out by EA or the like and live on, if not it will fold. The real danger is to the die-hards who still want to play when the game loses popularity... And since they're the ones most likely to have substantial investments, they're the ones most likely to sue.

Re:Sure, until they try to shut down second life.. (1)

Skippy_kangaroo (850507) | more than 8 years ago | (#12828535)

Now when Second Life goes under-- and it probably will at some point, though it could be a year or two decades from now-- your investment in their "land" and "property" is gone. It's not like you can carry it over to Everquest...

But that can be factored into the price. I have ownership of this property for, say, five years and, as such, it is worth less to me than something I can own forever. (The maintainers have a repo with you if you want to get all financial jargony.)

But, I can't imagine that people really care whether the duration of ownership is two years or 20 years - it will be so passe two years from now, and the pimply faced teenagers who only have a second life may get a first life in that time. It may have nostalgia value, but it would have to be one very understanding girlfriend who would let you take her back to your place when your place is virtual real estate on a server somewhere.

Re:Sure, until they try to shut down second life.. (1)

RickPartin (892479) | more than 8 years ago | (#12828584)

The problem is that with any online service you have to agree to a click through license saying they can burn down your house for fun if they feel like it and you have no legal recourse. I don't know how well these EULAs hold up in court though.

Re:Sure, until they try to shut down second life.. (1)

Lisandro (799651) | more than 8 years ago | (#12828619)

Nope -- you're owner of the contents of the site; the webhost just provides you the service of placing them online.

Re:Sure, until they try to shut down second life.. (3, Insightful)

mindstrm (20013) | more than 8 years ago | (#12828153)

Or they'll pull out their contract, which you agreed to before purchasing the service, which covers their ass in this situation.

Does Virtual Greenspan Know About This? (3, Funny)

creimer (824291) | more than 8 years ago | (#12827971)

I'm sure the virtual government will intervene to prevent the virtual economy from collapsing if the virtual real estate bubble does a virtual pop. There's nothing worse than losing your virtual shirt when owning virtual real estate in the virtual world.

Not that crazy (2, Interesting)

hashbrownie (313486) | more than 8 years ago | (#12827979)

This reminds me a lot of website property.

A company -- say, Amazon.com -- owns the title to a website. They have rights to the property at http://www.amazon.com/ [amazon.com] . But the actual bits on the server don't have to reside on computers owned by Amazon; they could hire a hosting company to do that.

That's what's going on with Second Life. The video game is hosting the "site", and they're licensing rights to areas of the "site" to individual people.

Come to think of it, it also reminds me of an IPO. But instead of selling ownership, Second Life is selling rights to its product. I don't see anything wrong with this whatsoever.

Life's a game, get over it. (3, Interesting)

Eunuch (844280) | more than 8 years ago | (#12827984)

This is no big deal. Are the people who buy paintings for way too much money losers too?

Re:Life's a game, get over it. (1)

RickPartin (892479) | more than 8 years ago | (#12828113)

Exactly! There is nothing wrong with paying for entertainment. As long it does not take over someone's life or involve hurting cute little kittens then who cares.

Life is about having fun. If escaping into a virtual world is your thing then go do it!

You insensitive clod! (0)

Anonymous Coward | more than 8 years ago | (#12828208)

I create paintings by dipping cute little kittens in paint, then firing them at a canvas with a huge slingshot... and now you're trying to say there is something wrong with paying for this form of entertainment?!? Think of the children! How do you expect my kids to eat, if noone is willing to pay for my kitty-splat artwork?

P.S. Does anybody have any kittens up for adoption to a good home?

Re:Life's a game, get over it. (1)

Anonymous Monkey (795756) | more than 8 years ago | (#12828134)

That depends. Is it for the love of art? No, they arn't losers. Is it for the love of resale? That depends. Are they doing it to prove they can get something no one else has. Yes they are losers.

I don't get it. . . (3, Interesting)

sithsasquatch (889285) | more than 8 years ago | (#12827988)

Everyone gets weirded out when you mention the idea of "intangible" property, yet few people have any qualms about paying bills online, using credit cards, or otherwise using money that they never see. Few get upset when they buy/download software that is just as intangible as the goods in an online game.

So is it really the intangible property that weirds people out? Or the fact that the general media has no damn clue how online games work?

I didn't get weirded out. (1)

Eunuch (844280) | more than 8 years ago | (#12828013)

Emotional knee-jerk reactions aren't that interesting.

Re:I didn't get weirded out. (1)

sithsasquatch (889285) | more than 8 years ago | (#12828044)

Emotional knee-jerk reactions aren't that interesting.

...unless you're looking for something to cater to the "videogames are sending society to hell" portion of the ten-o-clock news.

Re:I don't get it. . . (0)

Anonymous Coward | more than 8 years ago | (#12828162)

Wow. You must have wasted a lot of time and money in this game to think that paying bills online is somehow the same as what these people are selling.

Wanna buy a virtual foot up the ass?

Re:I don't get it. . . (1)

sTalking_Goat (670565) | more than 8 years ago | (#12828243)

So is it really the intangible property that weirds people out? Or the fact that the general media has no damn clue how online games work?

Thats it exactly. A guy can pay 6 figures for a $5 ball because some rich athlete hit it with a stick and then scrawled his name across it, but I pay $10 a month to fly around in virtual spaceship and I'm the loser.

How does that work?

Re:I don't get it. . . (1)

brain159 (113897) | more than 8 years ago | (#12828427)

If all you're doing is flying round in spaceships in SL, you only need the $10 once-off membership - unless you like buying lots of spaceships or dislike having to save up much, in which case the greatly increased stipend ("virtual allowance", if you like) might be of value to you.

I'm enjoying having a wander round SL so far, but I really need a better graphics card before I move over to Premium membership and find some land to play with (my old geforce4 isn't really cutting it any more). I'd quite like to try making some custom flat/spin-and-spew theme park rides at some point.

Re:I don't get it. . . (0)

Anonymous Coward | more than 8 years ago | (#12828540)

It doesn't, you're both losers. Mind you, he's a rich loser, so he probably has a girlfriend.

"Prosthetic extensions of the mind" (1)

rolofft (256054) | more than 8 years ago | (#12828358)

There were plenty of qualms when credit and debit cards first started gaining popularity. Hernando De Soto mentions in Mystery of Capital that Europeans were totally weirded out by Marco Polo's accounts of the Chinese using paper money. Marx was weirded out by another intangible property of assets: capital.

Re:I don't get it. . . (2, Interesting)

stinerman (812158) | more than 8 years ago | (#12828571)

For your sake, I hope you're just joking. If that isn't the case, I'll explain it to you.

When I pay my bills online, I am paying for a good or service that exists in the real world. While I do not get paid in physical bills, the number which represents how much money I can spend on physical goods increases.

In the bank/credit card case, the number is a representation. In the case of so-called "virtual items" there is no tie-in with the real world. The bit sequence is all that actually exists.

Rich kids. (3, Interesting)

Poromenos1 (830658) | more than 8 years ago | (#12828000)

So this is like RL all over again? I play games to escape from reality, if rich kids can have all the cool eq/chars/whatever in the game as well, what does that leave me with? I might as well be a poor loser somewhere where I don't have to pay money.

Re:Rich kids. (1)

micromuncher (171881) | more than 8 years ago | (#12828436)

Those kids might be able to BUY the toons, but they ain't got the skillz. All those level 70 uber toons in raiding guilds - how many of them are in the ranks of bored housewives or underemployed?

Most of our guild is working class poor (that appreciates that goals are much easier to attain in virtual life than real life...)

Western vs. Eastern (4, Insightful)

GPLDAN (732269) | more than 8 years ago | (#12828006)

I think we may be missing something here. The power of the notion of land ownership. In some societies, namely China, Japan, the Phillpines, the idea of land ownership is beyond fathoming for many people, who can otherwise afford broadband and computers.

To them, the notion that land "exists" in the virtual world connects to their ideas of self-worth in a very tangible way.

Re:Western vs. Eastern (3, Insightful)

Moiche (840352) | more than 8 years ago | (#12828527)

I strongly disagree. Your claim that land ownership is beyond fathoming for many people in China, Japan, and the Phillipines is objectively verifiable as incorrect. Japan, in particular, has a real estate market that has been over the past 20 years more volatile and widely held among Japanese than the American real estate market. Japanese real estate reached such a height of speculation in the late '80s that the Imperial Gardens in the center of Tokyo were valued at an amount greater than all the land in the United States at the time. About $60 billion USD was invested in Chinese real estate speculation in 2001 (private purchase and sale of real estate in China has been legal for decades despite the communist government). The Phillipines has operated on a thorougly Americanized capitalist model since WWII, and your inclusion of it is bizarre.

Where you got the idea that these countries are characterized by an inability to fathom land ownership is difficult for me to fathom. Perhaps you are perpetuating absurdly out of date stereotypes about attitudes toward material possessions among adherents to Buddhism, Shintoism, Communism in South-East Asia? If that is the case, please read up. Buddhism is officially suppressed in China, Shinto is on the wane in Japan, both religions have a vast majority of adherents who do not find accumulating material possessions to conflict with their religious beliefs, and the Phillipines is a majority Catholic country! Also -- as I already pointed out, the communist government in China has permitted private transactions such as real estate sales since Deng Xiaping's reforms -- which began 30 years ago.

Finally, your contention that virtual land, through appealing to the self-worth of the peoples you've pigeonholed as not being able to understand land ownership, borders on the absurd. Why would ownership at all contribute to self-worth among people who supposedly can't contemplate it in the first place? Wouldn't feelings of self-worth just be derived from accumulation of material possessions -- which in turn would require virtual land to be worth something?

Your entire line of reasoning smacks of the "Mysteries of the Orient" trope which was (barely) excusable in the 1870's, but is no longer. Spend some time in China, Japan, or the Phillipines, and you will find millions of savvy, throughougly capitalistic and materialistic businesspeople more than willing to buy and trade things worth money. Sure they may extract feelings of worth from accumulating an ass load of land -- but then again so does Donald Trump, and last I looked he lives in the East.

Come on people, we are better than this.

Moiche

Products and Services (2, Interesting)

Esion Modnar (632431) | more than 8 years ago | (#12828025)

I think of selling virtual properties as more of a service than as a tangible product. If I spend 13 hours killing rabbits to level up to gain the Sword of Swat, then selling the Sword of Swat is just another way of saying I'm selling my 13 hours of work to gain the Sword of Swat.

Selling intangible property is more similar to offering to shovel somebody's driveway for cash, than to selling your old stereo. That the item is neither tangible nor permanent makes it no less legitimate. (However, I would never pay real money for RTS property.)

Not that crazy (2, Interesting)

RickPartin (892479) | more than 8 years ago | (#12828058)

I have not played this MMORPG but have played many others. Paying for things in these games may seem insane to you. But once you get addicted and start putting in a few hours a day, $5 for the uber sword of death or some land seems very reasonable.

On the other hand it can turn the game into a "only those with more money have fun" type of thing... Well I guess they are trying to make it more like real life.

Re:Not that crazy (1)

Qzukk (229616) | more than 8 years ago | (#12828141)

On the other hand it can turn the game into a "only those with more money have fun" type of thing... Well I guess they are trying to make it more like real life.

The key is that if you don't have money, you can earn it (hey, just like real life!). Make something interesting, like that weird bingo-ish game that showed up on slashdot a while back that's now being produced in the real world. Or just interesting in-game trinkets and convince people in-game to buy them from you.

Re:Not that crazy (0)

Anonymous Coward | more than 8 years ago | (#12828150)

I have not taken this drug but have taken many others. Paying for drugs may seem insane to you. But once you get addicted and start putting in a few hours a day, $5 for hit of crack cocaine or some meth seems very reasonable.

On the other hand, it can turn drugs into a "only those with more money have fun" type of thing... Well I guess they are trying to make it more like real life.

That's no moon... (0)

Anonymous Coward | more than 8 years ago | (#12828106)

...that's a beowulf cluster of servers...

From Someone Who Actually Plays The Game (5, Informative)

TexVex (669445) | more than 8 years ago | (#12828121)

Second Life is an online game of a whole different sort. You see, the vast majority of the content in the game is player created. As a subscriber, you have the ability to upload textures and sounds. You can create objects in the game and put the textures on the objects. You can program in a proprietary scripting language using a provided API that gives you access to the game's particle system, accounting system, and the game world itself.

The backbone of this economy is the Linden Dollar (L$). Each subscriber gets a weekly stipend of it as part of the package, plus you can trade real money for L$ on the open market. Players create and consume content in the game. For example, some people spend all of their time creating avatar clothing textures (using Linden-provided texture template) and selling copies of them to other players. The ones that make the best clothes make the most bank. Other people (LOTS of other people) re-invent the slot machine or various casino games over and over again and rake the money gambled with the game's they've created. Some people create new games on their own (like one called Tringo that's very popular these days) and license them. Tringo can be played for free, but it takes a lot of land to host a game and organizations that collectively own huge tracts of land and use them as malls use Tringo and like games to attract shoppers.

In other words, the game is just nothing but the foundation upon which an economy can form. One formed there, and Second Life's creators deserve to be lauded for that.

It's just like any software purchase (1)

Kallahar (227430) | more than 8 years ago | (#12828126)

Is owning virtual property any different than owning any other sort of software? When you pay $800 for photoshop, you get a long series of ones and zeros that end up performing some function. When you buy virtual real estate, you're buing the right to do something with a similar long series of ones and zeros which perform some function (entertainment).

While I personally wouldn't spend money on either product, I can understand how some people would. What we need to do is to make sure they realize that all the rules are set by the company, it is definately *not* like real-world real estate.

Its money (0)

Anonymous Coward | more than 8 years ago | (#12828142)

This scheme seems stupid, but realize that all they have done is virtualized money. Like poker chips. Now, why would somebody want to use this sort of money? How many of those reasons are legal?

Re:Its money (3, Interesting)

ultramk (470198) | more than 8 years ago | (#12828228)

Well, how can you virtualize something that's already virtual?

The monetary system in the country (and all others, as far as I know) is based upon a shared (and mutually agreed-upon) illusion of value.

This is what Stephenson's Baroque Cycle (and Cryptonomicon, for that matter) was talking about. This isn't a virtualization of money, this IS money. These people are creating money, printing their own currency in the most elemental way possible, they're thinking it up.

It's interesting for that reason alone, aside from what people are actually doing with the service.

m-

Earn real $$$ for cutting virtual lawns (1, Funny)

Anonymous Coward | more than 8 years ago | (#12828183)

Sod slaying a dragon and possibly dying.

Let me cut these landowners lawns in game!

> wield flymo
You are now wielding a flymo.
> kill grass
You attack the grass with your blade of cutting. You hit! Grass loses 2"
Grass attacks you! You get some mushy grass on your boots.
You attack the grass with your blade of cutting. You hit! Grass loses 1"
Grass is cut!
You earn $5.
>

Dollar bills are intangible (5, Informative)

G4from128k (686170) | more than 8 years ago | (#12828198)

For all their stability, dollar bills are intangible. They are linked to no set physical item of value. Even when the country was on the gold standard it did not have enough gold to back all the dollars in the economy.

As for bubbles, the stability of the worth of something (whether its U.S. $ or LindenDollars) depends on the sustainability of the economy (e.g., the extent that its not a Ponzi scheme) in terms of both the materials being traded and the participants. Even real-world tangible goods have no guarantee of stable value. For example, some would argue that real estate in the U.S. is currently a bubble and that the true value of what seems like a very tangible good has become inflated.

The point is that all economies, both virtual and real, are about intangibles defined by people's relationships to each other and to items of reputed value. A dollar is only worth what someone else will trade for it. A block of land or uber sword of death is only worth what someone else will pay for it. Even tangible objects (e.g., a brick of gold) only has value to the extent that others will trade gold for other desirable goods such as food. Value is in the eye of the beholders, both buyer and seller, and has no other value than that. At best, the values of different items may become fixed relative to each other (but not on any absolute scale) becuase of the ability to transform one item (e.g., labor) into another item (e.g., attained goods in a game or in real life).

Economies and the notion of value are a human invention. As such, the dynamics of societies guarantee that even the most tangible of goods can fluctuate in value.

Q: How easy is it to separate idiots from their $? (0)

Anonymous Coward | more than 8 years ago | (#12828274)

A: funhi.com

Buy animated GIF icons of real things for real cash to "give" to other members of the site, in hopes of attracting them.

I can't believe I still work at a normal job knowing this kind of easy money is out there.

USD$.4m? (0)

Anonymous Coward | more than 8 years ago | (#12828279)

I would honestly like to know...for whom is "$.4m" easier to understand than "$400,000?" Is that even what it means?

Dutch Tulip Bulbs (4, Insightful)

Moiche (840352) | more than 8 years ago | (#12828284)

Like Dutch Tulip Bulbs [wikipedia.org], virtual real estate on Second Life will continue to have customers as long as it looks like there may be a greater fool [wikipedia.org] to pay more for it down the line. The moment that purchasers cease to believe they will be able to sell their properties at a profit (or at all), we will see bubble-bursting, where everyone tries to sell their property at the same time, and the property instantaneously becomes valueless.

What is particularly scary about virtual property in a massive multiplayer is that the good is so completely unlinked to reality that virtually anything could burst the bubble. An executive in the company hosting is accused of embezzlement -- *pow*. The hosting company enters Chapter 11 -- *pow*. A new fad massive multiplayer starts up -- *pow*.

This is why the comparisons against derivatives are misguided. True derivatives are not physical things, but still, an option to buy pork bellies at a certian price in the future will not become worthless without pork bellies themselves becoming worthless. Whereas property on Second Life can become worthless for an infinite set of reasons.

I believe that the idea of objectively valuable virtual property, as explored by Neal Stephenson in Snow Crash (The Street), will someday become a reality. But not until: (1) hosting the massive multiplayer is distributed among organizations that can't go bankrupt; (2)the massive multiplayer is either continuously upgraded or technology independent (perhaps a standard forum that will be interpreted in different ways depending upon the users client; (3) the massive multiplayer somehow guarantees scarcity, at least of more and less desirability property (perhaps by having a hotspot located near the hubs where avatars log on as seen in Snow Crash); (4) accounts are protected by really, really, really good user authentification programs (or else victims of a dictionary attack could lose 20k over night); (5) at least some of the user base is able to access the universe of the massive multiplayer in a thorougly immersive way.

I think it's just a matter of time before these conditions are met, and spending real money on virutal property starts to make sense. But I don't think we are there yet, and those who are looking at virtual property less as a game and more as an investment are playing with tulip bulbs.

Moiche

Re:Dutch Tulip Bulbs (0)

Anonymous Coward | more than 8 years ago | (#12828670)

==> but still, an option to buy pork bellies at a certian price in the future will not become worthless without pork bellies themselves becoming worthless

Bzzt! Wrong answer.

Sure the pork bellies themselves will not become worthless, but "an option to buy pork bellies" can become less than worthless -- e.g. cost you real money to excercise, and result in a loss.

Go read up on how options work.

Not that altruistic (3, Interesting)

mcraig (757818) | more than 8 years ago | (#12828311)

It does seem a bit odd after all with processing power/storage growing the way it is, the same computer that can generate say 800sq miles of linden land today will be able to generate a much larger sized plot tomorrow, how does that factor into the equation ?

Also it would be more altruistic if they allowed you to host your own server with your own land that you can control who can visit. That way people who provide their own server get the benefit of not having to pay maintenance fees (they would still pay for the software, developers have to eat I agree, being one myself).

Think of it this way many games i.e. Quake, Counterstrike have worked for years by providing networking functionality and people create their own servers etc.

Granted MMO networks need to be much larger and persistent, though why can't they take the BitTorrent approach. Rather than have one central bank of many powerful servers, all computers running the game could connect together to form an adhoc grid with just as much computing power if not more. This would negate the huge maintenance costs required and hence the need for monthly fees. Which is where I see the sinister part, it's like saying rather than lets look for a better solution, lets look for the most expensive solution.

Hernando De Soto's The Mystery of Capital (1)

rolofft (256054) | more than 8 years ago | (#12828375)

When we were developing the idea we read a lot of books and were inspired by Hernando DeSoto's The Mystery of Capital: Why Capitalism Triumphs in the West and Fails Everywhere Else.

I would have been interested to hear more about how they included De Soto's ideas in their game.

From the comments on the review of Mystery of Capital [slashdot.org], I got the impression a lot of Slashdotters totally missed De Soto's point. He doesn't advocate for or against capitalism in the book. He argues for making existing capitalist economies more inclusive. De Soto describes a method for cracking the "bell jar" [economist.com] that insolates the rich and excludes the poor.

What happens when game goes away in a few years? (3, Insightful)

Optic7 (688717) | more than 8 years ago | (#12828489)

Like one of the comments posted on the article, I also wondered what happens 10 years down the line when the company goes out of business, or the game is no longer profitable and is shut down?

I guess consumerism has reached it's logical conclusion. How long before companies start selling us our own thoughts and emotions? I guess they already have, in indirect forms (entertainment/media). Meanwhile in the real world, millions of people die every year of starvation and disease.

Amused to Death (2, Funny)

Doc Ruby (173196) | more than 8 years ago | (#12828557)

Virtual property is a way for China to completely destroy America's economy. Labor can be directly converted into property, without regard to physical limits, or even investment capital (except living expenses to grow a person to about 14 years). A hundred million Chinese play-workers playing games for property which they sell to American gamers too lazy to play-work for it themselves will sap the Americans' money quickly. And when the Chinese mafia government prioritizes MMORPG development, with their vassal industrialists running the servers, there will be plenty of inside jobs. Just like the Roman Empire outlawed much trade with the more productive Indus valley to keep their trade imbalance under control, America's economy could be threatened by removing all limits to American dollars flowing to China for virtual property that doesn't increase American productivity.

"Something intangible" ? (1)

drsmithy (35869) | more than 8 years ago | (#12828596)

In the wake of last week's virtual property slaying, they discuss the realities of owning something intangible.

You mean like, say, music ? Or software ? Or anything else defined by "intellectual property" laws ?

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