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Second Life: hype or business model?

After my first 2 month in Second Life, I want to give you another report if it could be a business model or if it is just a big waste of time.

First of all: I found some useful usages for SL so far.

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Education

Some institutions are using SL for learning and teaching. English Village is offering language classes, mainly ESL. They are using "holodecks" to produce learning environments like a restaurant, a bus stop or other places that are great for role play.

Thomson NETg is a big sponsor for the Academy of Second Learning (ASL) which is offering free classes for SL-topics as well as RL-topics at the moment.

Even Germany has now a representation of a German "Volkshochschule" in SL: VHS Goslar.

The Museum of Spacecraft in Spaceport Alpha is a very good example how you can teach people with real "hands-on" experience. They are showing all spacecrafts with all the technical and historical information there. You can inspect how a spacecraft engine works in 3D. You can even fly into orbit and inspect a model of the planetary system.

Another learning place can be found at ROMA that is a replica of ancient Rome. You learn here how the old Romans lived, what they ate and you can even buy their food to make your avatar eating it (using an animation script that comes with the food).

Presentation

Possibilities for Presentation are limited in SL. Every image that you want to show here must be uploaded for a fee of 10 Linden (about 3.7 US-Cent) per image. Landowners can use streaming video but that will add even more costs for a streaming video Server that is necessary to set up in the real world.

Most presentations will take place using text chat and uploaded images. So you will see some PowerPoint like slides along with much text chat. Some people are using third-party voice chat software like teamspeak to use spoken presentations. But this will not be available for all SL users. Some don't have a headset or the computer is not powerful enough to run SL and the voice application simultaneously.

Marketing

Some companies are using SL for marketing. Coca Cola has an island here as well as Nissan, Mercedes and BMW. Especially the car companies are very interested in SL, because Avatars love to drive new cars, even if they are just virtual cars.

Some manufacturers of sport shoes do the same to try out new shoe outfits in the virtual world first. Even the German Post will have an island in SL in May 2007.

Discussion

SL is also a great place for discussions. Anybody can choose a public place here and enter a discussion event in the community calendar. Discussions will be performed using text chat. You can either enter your text in the public chat that everybody can see, or you can speak to other avatars in private using instant messages.

It's also easy to exchange your knowledge with other people. You can easily give notecards, landmarks or even objects to other avatars. So you are not limited to your text alone but you can also share nice places that you have found in SL.

How to find the events?

Second Life has a community calendar for public events. It's easy to find these events in the SL-client by clicking on "Search" in the Button Set you find on your screen. You can then select the "Event" Tab and choose which sort of event you want to find. I use "Education" for SL classes. You can also put in a word to search but this doesn't work very well at the moment. The search will only look for the beginning of the title.

For example, if there is a class "^ASL^ Scripting 101" you can't find it by "Scripting", you have to type in "^ASL^" to find this title. I have reported this as a bug some weeks ago, but they seem not to be able to fix it yet.

You can also find the same events on the website http://www.secondlife.com/events/. The search for keywords works better here if you go to advanced search (http://www.secondlife.com/community/search.php?search_type=events).

The website will give you not only the description and time of the event, but you will also get an SLURL that will be able to open your SL-Client and show the place on the map. You can then choose "Teleport" from the map in SL. If you search in SL directly, you can just click "Teleport" from the description page which is faster and more convenient.

How to post events?

If you are interested to post an event for a discussion, a class or just a big party, go to the second life events page and choose "Add Event". To limit spam in the calendar, you will not be able to post more than 5 events per day, but that was never a big problem, at least not for me :)

You can choose among all public places from the event posting form. If you are member of a special group you can choose more places. I am a member of the ASL Faculty, so I can post events for the ASL Campus. This is important because the Teleport Button will take the user exactly to that place that you choose as location.

If you have friends who own land, you can also choose their location for an event. But for sure, it's better to ask your friend first ;)

How to use it for business?

I believe the most interesting question for most people is: how can I use Second Life for my business? I think there are some alternatives available:

1. You use it as a social platform for your company.
   This will be the easiest way to use Second Life in your company, just for having group meetings with visual aids and interaction. This will give people in a company an illusion of a real meeting. It can be useful if you do meetings with people that are spread all over the world in different locations.
2. You use it for education in your own company.
   Instead of wasting time and money for flying in your people to a classroom where they will attend a presentation with PowerPoint flair, you can invite them into a virtual classroom. You will have all the advantages like small talk at the water cooler if you schedule the event with regular breaks where people can chat together.
3. You use it as marketing tool for your company.
   Just show other people that your company is already present in Second Life. If you have something to show or to sell, just make a virtual representation of it and give it to SL residents for free. You don't have high production costs to build shoes, houses, cars, etc. So it's cheap and easy to give things away for free.

How to start?

So how can you start your business in Second Life? Do you need to buy a whole island?

No, it's not necessary to spend a lot of money on your own land, if you just want to try something out. You can easily rent some space for public presentation or if you want to sell something. You don't even need to have employees to greet your customers in the shop. In SL you find a lot of shops that are entirely empty.

This works because most things are sold by automatic vendors. You can also just put your items in the shop or place a box somewhere that contains the items that you want to sell. SL has an automatic selling system where you just set a price on the item or on the box. It will sell the item or the content automatically to everybody who pays the price. Because everything is so easy to copy, these objects always sell a copy and you will never be out of stock.

If your business model is personal service, you may want to have a greeter in your shop who can ask potential customers how they can help them. Even that is easy in SL, because all the new residents are usually looking for a job. So you just can hire somebody for a few lindens per hour to stay in your shop. Don't be afraid of shoplifters because items in your shop cannot be stolen, even if nobody keeps an eye on them.

This all makes it easy to set up automated points of sale in Second Life as well as building places with personal touch. Your shop will be available 24/7 because you may get customers from all existing time zones in the world.

Is SL the new Web?

If you compare Second Life with the beginning of the World Wide Web in its early years, you will find some things that are similar:

1. If you arrive on any place in SL, you have to wait for things to appear (SL speak: to rez) in front of you.
   This is very similar to the first websites on the Internet in the early days where you had to wait for all images to load. This is very similar in SL.
2. You can build your presence in SL by buying an island or renting some Land or just a small Shop or Mall.
   This is very similar to the web hosting business in the early days. People rented "Home-Pages" and paid fees for hosting just a set of 3-5 pages with address and phone number, just for being present on the Internet. People could buy or rent web servers for their presence, which was usually very costly. This is very similar in SL now.
3. Content is important.
   If you have your place in SL, nobody knows about it. So you try to attract people to you place by offering a cool night club, some free stuff or you even pay people for staying at your place (that's called "camping" in SL).
   The same happened (and still happens) on the Web if you try to attract people with free downloads or even paying people for clicking on paid advertising (like Google Adverts).

With all these similarities, SL may result in a similar hype as the WWW have been in the early days. As well as with the Web, it is important to have unique ideas and to be the first one to realize these ideas. With the growing success and the increasing demand for new accounts, it seems to be important to have an eye on Second Life as another option for Internet based business.

04/27/2007 09:01:05, von Marian , 1768 words, 7072 views   Categories: Articles

2 comments

Comments, Pingbacks:

Comment from: Boulder Tutor [Visitor] · http://mathnasium.com/boulder

If SL is worth it, it all depends on who uses it. Big companies are pouring millions into marketing in SL. We'll see how it goes.

Sandy
VailPM Events
Flyfishing Outfitters

07/13/2007 @ 18:20

Comment from: Rapidshare SE [Visitor]

Thanks a lot for a great advice! It has neer occurred to me that it is possible to use SL for your the development of your business.

05/05/2010 @ 07:44

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