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Role Playing (Games) The Almighty Buck

Second Life Virtual Property Boom 242

Posted by Zonk from the a-little-plot-of-land-on-the-edge-of-the-world dept.
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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Second Life Virtual Property Boom More

Second Life Virtual Property Boom

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  • I have a bridge for sale (Score:5, Funny)

    by nizo ( 81281 ) * on Wednesday June 15, 2005 @05:20PM (#12827851) Homepage Journal
    Actually I have several dozen, in any shade that you choose.

    • Intangibles always bust (Score:5, Interesting)

      by EmbeddedJanitor ( 597831 ) on Wednesday June 15, 2005 @05:33PM (#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 (Score:4, Interesting)

        by Saxerman ( 253676 ) * on Wednesday June 15, 2005 @07:44PM (#12828889) Homepage
        Virtual Reality was overhyped back in the 90s and then faded from the public eye, but it became a reality anyway. And this certainly isn't something new but many people are having trouble making the connection. When you buy a movie or lottery ticket, what did you really buy? Value may be subjective, but is by definition a tangible thing. Web servers and bandwidth aren't really intangibles. Advertising space seen by hundred of thousands isn't an intangible.

        Second Life was one of the first major financial movers in the virtual worlds department, which started as a simple 3D version of the text based MUSH/MOO style 'games' which have been around since the 80s. The major difference is they started as a purely commercial venture.

        Such virtual worlds don't yet have the draw that a more accessible game such as Everquest or World of Warcraft does. MMORPGs have goals that seem much more self evident, which allows casual gamers to more quickly value the bits that make up their virtual characters. However, as the wired generation grows up we will eventually have a world full of people who can more easily make that connection and are more than willing to pay money so they can look good in the exclusive Black Sun. The term "Persistent World" will take on new meaning as the few major players who have fostered the largest communities will kick off the next major revolution when they establish and share protocols so players can freely move their Avatar and virtual objects from Matrix to Metaverse.

      • Theory of Labor (Score:3, Insightful)

        by yintercept ( 517362 )
        Hi, how's everything way up there above the rest of humanity!

        There actually is a tangible aspect to virtual property...the time and effort used to produce the property. The theory of labor pretty much sees the amount of labor needed to produce a good as the major component of the price. The price of gold is largely determined by the amount of effort it takes to get find and get more gold.

        The reason virtual property is a bad investment is that the people who define the virtual world can change the rule
    • Actually I have several dozen, in any shade that you choose

      Yes, but do they run Linux? :)

    • Re:I have a bridge for sale (Score:4, Informative)

      by eggstasy ( 458692 ) on Wednesday June 15, 2005 @06:22PM (#12828292) Journal
      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]

    • Of course, once one of your bridges is erected and in service it will never need to be replaced nor maintained. The market for bridges will dry up. This, I think, is one of the flaws in this model of selling items in these game worlds.

      When I buy a t-shirt, 10-15 years later it's quite likely to have deteriorated to the point where it is no longer able to perform its job well. Likewise a car, or indeed a bridge, though each with a different average lifespan. Real items get broken, lost or even just worn out

      • Second Life is constantly adding new features and scripting commands, and the tools are way more powerful than regular MMORPG crafting. You can literally create anything. Dude, you can implement your own freaking TCP/IP stack, LISP interpreter or e-commerce solution... or whatever else trips your trigger. You can hook up SL to outside servers with XML-RPC and email for even more complex work... tie SL scripts into a MySQL database with a 5-minute PHP script... literally anything.
        The economy is in no more da

  • so.. (Score:4, Insightful)

    by Turn-X Alphonse ( 789240 ) on Wednesday June 15, 2005 @05:22PM (#12827864) Journal
    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.. (Score:2, Funny)

      by nogginthenog ( 582552 )
      You've got magic beans for sale? WOW! How much? I'll pay 1 million Linden Bucks!

    • Re:so.. (Score:5, Insightful)

      by BrookHarty ( 9119 ) on Wednesday June 15, 2005 @05:35PM (#12827965) Journal
      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....
      • 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 (proba

    • Re:so.. (Score:5, Insightful)

      by TexVex ( 669445 ) on Wednesday June 15, 2005 @05:45PM (#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?
      • 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
    • 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! (Score:4, Insightful)

    by winkydink ( 650484 ) * <sv.dude@gmail.com> on Wednesday June 15, 2005 @05:22PM (#12827868) Homepage Journal
    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.

  • Sell your real properties... (Score:3, Funny)

    by mitsui ( 891950 ) on Wednesday June 15, 2005 @05:25PM (#12827883)
    and buy the virutal properties before the bubble burst.

  • In other news... (Score:3, Funny)

    by Anonymous Coward on Wednesday June 15, 2005 @05:25PM (#12827886)
    virtual loser boom!

  • second life? (Score:5, Funny)

    by tuggy ( 694581 ) on Wednesday June 15, 2005 @05:25PM (#12827887) Homepage Journal
    second life?
    no thanks, i still have to get my first one!
    • 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.

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

    by raeler ( 463406 ) on Wednesday June 15, 2005 @05:34PM (#12827959) Journal
    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?

  • Does Virtual Greenspan Know About This? (Score:4, Funny)

    by __aaclcg7560 ( 824291 ) on Wednesday June 15, 2005 @05:36PM (#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.
    • Try losing your real shirt (or life) when your physical realm takes a hit.

      Just ask the folks who had their physical realm impacted by the tsumani, or people who've had their villages burned in genocidal cleansing operations around the globe.

      Wanna bet their real estate valuations took a hit?

      There are events that governments are powerless to prevent, or protect their citizens from.

      I see no difference here between the physical and virtual realms. There are certainly differences, but they do not involve ec
    • Second Life already has plenty of people losing their virtual shirts... as well as virtual shorts, and virtual underwear. I almost signed up to play it until a quick browse around showed that its difficult to make a profit on anything other than real estate or various forms of sex. One web site listing auctions for the game had two people competing to sell the most "fully functional" Japanese schoolgirl avatar... *shudder*

  • Not that crazy (Score:2, Interesting)

    by hashbrownie ( 313486 )

    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 i

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

    by Eunuch ( 844280 ) * on Wednesday June 15, 2005 @05:38PM (#12827984)
    This is no big deal. Are the people who buy paintings for way too much money losers too?

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

    by sithsasquatch ( 889285 ) on Wednesday June 15, 2005 @05:39PM (#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?
    • 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?

      • 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
      • Your not a looser for paying the $10 a month - thats exactly the same principle as paying for cable subscription, internet or going to the cinema, you're paying for some cheap entertainment. If you however pay 6 figures for some level 50 armour and a sword of darth-zorro +10 against quasai-zorks simply because you want to beat everyone, that makes you a looser. If you pay for it because you think you can dupe some sucker into paying even more for it, then you're not a looser, your an investor.
    • 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.
    • 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.
      • While the banknotes in which you place such faith have intrinsic value because of ... umm....

        Well, OK, the intrinsic value of banknotes is so low that they have to put special software in laser printers to stop people forging them. So I guess the value is that they are linked to the gold standard. Well, once upon a time anyway...

        So maybe its becuase there's only a fixed number in circulation other wise the governments would just print more money to get out of debt and we'd see inflation at work.... whi

        • While the banknotes in which you place such faith have intrinsic value because of ... umm....

          Bank notes have NO intrinsic value, only extrinsic value (you may be confusing terms). I could care less if I'm trading in gold, silver, or a fiat currency, so long as I can exchange it for something I want. And no, I don't place any faith in US Dollars, since our currency will tank in the next few years due to massive deficit spending, but I digress.

          I don't really understand what you're advocating in the rest
      • When I pay my bills online, I am paying for a good or service that exists in the real world

        When you buy virtual property you are paying for a real service. The ability for you to use such property (acording to the rules/T&Cs).

        While I do not get paid in physical bills, the number which represents how much money I can spend on physical goods increases.

        Money is just a representation of a value unit. Real or electronic it only has value because it is rare and is accepted by others in exchange for ot
        • I get your arguement, I just don't see the point in shelling out money to get +10 against Orcs.
          • I just don't see the point in shelling out money to get +10 against Orcs.

            Same reason you would spend $400 to get a +25 yards driving distance golf club.
            You could argue that with the golf club you get a physical item, but in realistic terms the premium price tag is directly linked to playing golf. You would be hard pressed to find somebody willing to pay $400 for what is essentially a finely crafted stick, unless they were a golfer or thought they could turn around and sell it to a golfer.
    • "...yet few people have any qualms about paying bills online, using credit cards, or otherwise using money that they never see..."

      Paying bills online is still using real money to buy real things. If I don't pay my power bill, my electricity goes off. Lots of bad things happen in the real world when the electicity goes off.

      There is nothing wrong with paying a small fee for some intagible entertainment. That's the very nature of going to the theater or listening to a concert. Where people start rightful

  • Rich kids. (Score:3, Interesting)

    by Poromenos1 ( 830658 ) on Wednesday June 15, 2005 @05:40PM (#12828000) Homepage
    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.
    • 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 (Score:5, Insightful)

    by GPLDAN ( 732269 ) on Wednesday June 15, 2005 @05:41PM (#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.

  • Products and Services (Score:3, Interesting)

    by Esion Modnar ( 632431 ) on Wednesday June 15, 2005 @05:44PM (#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 (Score:2, Interesting)

    by RickPartin ( 892479 )
    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.
    • 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.

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

    by TexVex ( 669445 ) on Wednesday June 15, 2005 @06:01PM (#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.
  • 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 al
    • It's a little different, in that you have even less control. If Adobe went out of business tomorrow, my copy of Photoshop would still function. If Adobe sold photoshop to Microsoft, and MS decided to add Clippy to it, my current version would still work the same, and I could continue to live Clippy-less.

      Second Life is different in that it all resides on their servers. If they decide to close up shop, all my in-game stuff goes with them. Even if I exported it somehow, it's of very little use to me out of ga

  • Dollar bills are intangible (Score:5, Informative)

    by G4from128k ( 686170 ) on Wednesday June 15, 2005 @06:12PM (#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.

  • Dutch Tulip Bulbs (Score:4, Insightful)

    by Moiche ( 840352 ) * on Wednesday June 15, 2005 @06:21PM (#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

    • 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 disagree. Pork bellies could become devalued for an also infinite number of reasons.

      • Competition. Fat free pork bellies could come out tomorrow, for a negligible p

  • Not that altruistic (Score:3, Interesting)

    by mcraig ( 757818 ) on Wednesday June 15, 2005 @06:25PM (#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.
    • A couple problems with that, the biggest one being that bandwidth seems to be the biggest bottleneck for Second Life. Everything is streamed to the client as it moves through the world, from the terrain, to the objects, to the textures and scripts. Because everything is user-created, the world is changing so constantly, it has to stream to stay updated.

      If you fly through the world at a decent speed, you'll miss a lot, because it hasn't had time to download and appear. Or you'll go somewhere, but you have t
  • 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 ec

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

    by Optic7 ( 688717 ) on Wednesday June 15, 2005 @06:47PM (#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.
    • It's no different to the question "what happens 10 years down the line when this hard disk I paid $150 for dies?" or "what happens 10 years down the line when this car I paid $12,000 for dies?" or pertinently right now, "What happens to my Rover car that I paid $15,000 when it breaks down and I can't get spares because Rover just went bankrupt?"

      Virtual property is like anything else that can be traded; its value can increase or decrease relative to something else. It has a set of 'what ifs' attached to it

  • Amused to Death (Score:3, Funny)

    by Doc Ruby ( 173196 ) on Wednesday June 15, 2005 @06:55PM (#12828557) Homepage Journal
    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.
  • 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 ?

  • Should virtual property be treated as real? It's moot; what's happened in common law is that it's been determined to be real. Case closed.

    I hate when people sum up complex and unresolved issues with flat statements like this. Saying something is worth money and calling "real" are two different things. There's a long legal history of acknowledging that intangibles can have monetary value. It's nothing new, and it's a far cry from a sweeping declaration that virtual property is real. Virtual property is a f

  • An important point (Score:2, Interesting)

    by Ponzicar ( 861589 )
    People are forgetting one thing: in this game, the game creators are basically gods. Even if they promise to not change anything on the perfectly located beachfront property with gold mines and AI bikini girls, there's nothing that can stop them from making a hundred more islands with identical property when they feel the need to squeeze a bit more cash out of the game. Or what if they release an expansion with new content that makes assets in the old game worth almost nothing in comparison? People who ha

  • "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.'"


    Error: sentence cannot be parsed. abort, retry ignore?

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