Tuesday, December 18, 2007

Massive lay offs and the future of NVE's

Today Massively made it into my RSS feed. There's really a couple of cool Second Life residents blogging over there now. This time it's Moo Money that brings up some juicy gossip from Second Life as she writes on the ESCapists:

In a shocking blog entry today, Jeremy Flagstaff noted that the Electric Sheep Company has laid off approximately one-third of their staff, or about 22 people. It has been previously noted that ESC had to cut back on the number of islands for CSI: NY, and now both AOL Pointe and Pontiac are pulling out of Second Life. This news should come as no surprise, but it's still heartbreaking to hear that it
happened so close to Christmas.

While it is not known at this time exactly why the layoffs occurred, Jeremy speculates that they will be focusing on technology like OnRez. Joel Greenberg, whose job status is unknown at this time, announced on Twitter that ESC is shutting down their virtual ad network project. In a prophetic blog entry written last week by Rez Menoptra, he speculated on how long builds will last in virtual worlds and who will remember them.

Massively will update you with the latest news on this topic as we hear it. Stay tuned!

Most of these people we will never know, but we've seen Jeremy himself move away from the Sheep earlier this year as well as Jerry Paffendorf. Is the negative trend for Second Life we've seen in Europe now crossing to the US as well? Are we close to a dotcom-burst in the virtual world industry? I don't think so.

In november I quickly mentioned AOL's departure from Second Life, now Pontiac is joining the list of departing companies. How should we read these signs: Is it true that Second Life has proved itself unfit for business? In the case of Pontiac / Motorati I think it surely didn't.

The thing I keep saying to our clients is this: Right now Second Life is the ideal platform to experiment. It is open, and it's present, which means you can start up exploring the metaverse at relatively low cost. Try to get a feel for the technology, explore opportunities, chase ideas. Second Life makes this possible because it's free to sign up and you can put in almost any kind of data. Second Life is as open as the gates of heaven to whom believes. The feeling I get now is that most of the departing companies are not going out of business, they're moving. It's just as much tribal migration that we see in social networking sites. You explore, then find a site that better suits your needs. A lot of these companies gained experience from Second Life and are now preparing for dedicated themed worlds, based upon enterprise technology on platforms like There.com

It is a moving business we're in. The past year has seen an extreme usergrowth in Second Life, and an enormous commercial / PR drive for companies to enter virtual worlds. Now it's time to check the balance. All in all, as I wrote in my previous blogpost on the Millions of Us venue for Splenda; "It's Dozens of Them" meaning right now it's just too much of the same. We're creating presence for companies. There's an occasional immersion that goes beyond simple presence and really adds something to the industry.

Millions of Us, Lost in the Magic Forest, Electric Sheep Company, Virtual Italian Parks, and many many other MDC's have mastered the skill of building in Second Life. What they haven't got is the skill of Business Analysis.

It will take skilled consultants to translate core business to virtual representations. It will take experience and time for us to be able to build virtual venues that are fit for business and will form an extention to our daily operations. 2007 has been a year in which Second Life and virtual worlds have been a toy for marketing and communication departments, 2008 will probably see NVE's as a playhouse for IT departments and 2009 will probably be the year in which the NVE potential really sinks in, the time when the Business takes over and will use it as a medium for its core processes.

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6 Comments:

Anonymous Dobre Vanbrugh said...

Hi Veejay, keep in mind that a lot of the business for MDC's like ourselves comes from advertising companies who act as the 'middleman' between us and the advertiser. It is also them who have to be able to analyze the communication needs of the client and come up with concepts and campaigns that fit those needs. Unfortunately and traditionally the advertiser rings his agency first and not us, so we have to deal with a big chunk of oldschool thinking and most of the times we can only change a small part of this. It will take time...

Tuesday, December 18, 2007 12:19:00 PM  
Anonymous Anonymous said...

Good analysis, Mal.

Wednesday, December 19, 2007 12:39:00 AM  
Blogger dyerbrookME said...

Also, just some correctives here to put things more in perspective. 22 people laid off from the Sheep isn't a "massive" lay-off, as there are still, all told, thousands and thousands of people in business in SL making a profit, and many of them a living. That story, while boring to the geeky analysts because it isn't about metaversal development companies, is still relevant. And...it's a miracle anybody makes a buck off virtuality, so complaining about "massive" layoffs in this completely wonky volatile neo-industry seems...odd.

Also, the cool bloggers are just the FIC, the people who got to befriend the Lindens long ago, and therefore got the leaked memos, and also are close to the Sheep.

Prokofy

Wednesday, December 19, 2007 2:30:00 AM  
Blogger VeeJay Burns said...

Prokofy,

In terms of the herd it's a massive lay off though. It's a quarter to one third of their sheep.

If IBM or General Motors had to let go a quarter of its employees all of a sudden the world would rock.

And yes, I know there are lots of other companies who still have their order portfolio's filled to the brim for the coming year.

Wednesday, December 19, 2007 8:03:00 AM  
Blogger xlent1 said...

Agree on points raised. Is consistent with our view from Nov LL data

http://rezzable.com/blog/2007/vr/second-life-market-size-growth-is-slowflat-ll-leaves-door-open-for-new-virtual-world-competitors/

LL is flat atm. Looks like they need to break through on backlog of tech issues...we think they will. They dedicated, motivated and just need a little time to sort out what must be a complicated stack of apps and deployment architecture. SL still best show in 3D Web.

We think LL is still in a marketing coma though. Really they need to tell the story about the virtual world and global community rather than the fringe. This is largest issue. Why is it in fact a 2nd Life...not just another social environment like facebook et al? Is there something so twisted that it really needs to be concealed. We don't think so and neither do most SL residents we suppose.

Tuesday, January 08, 2008 10:59:00 PM  
Blogger xlent1 said...

Agree on points raised. Is consistent with our view from Nov LL data

http://rezzable.com/blog/2007/vr/second-life-market-size-growth-is-slowflat-ll-leaves-door-open-for-new-virtual-world-competitors/

LL is flat atm. Looks like they need to break through on backlog of tech issues...we think they will. They dedicated, motivated and just need a little time to sort out what must be a complicated stack of apps and deployment architecture. SL still best show in 3D Web.

We think LL is still in a marketing coma though. Really they need to tell the story about the virtual world and global community rather than the fringe. This is largest issue. Why is it in fact a 2nd Life...not just another social environment like facebook et al? Is there something so twisted that it really needs to be concealed. We don't think so and neither do most SL residents we suppose.

Tuesday, January 08, 2008 11:00:00 PM  

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