A First Look at Second Life

How's this for blurring the lines between virtual and real? A real Reuters reporter reports a real news story about Congress considering taxing real income earned on a virtual web site, where the reporter writes under a fake name as his real-life employer's (Reuters) new chief of a virtual news bureau.

Huh? Welcome to Second Life, the popular and growing parallel universe on the Internet. Maybe you've read something about Second Life and thought it's just another online game. It is definitely social, but if you define a game as something that's played, won, and finished, this isn't it.

The latest news is that Reuters did indeed open a news bureau in Linden, the virtual city on Second Life, called SL by its virtual residents, which number more than 900,000. London-based correspondent Adam Pasick writes as Adam Reuters on the site. Curious? Here's a look at Second Life, and how the popular virtual world is attracting real-world companies and entrepreneurs, which may be a sign of how business will be conducted on the web.

What is it and who is there?

Think Sim City, only bigger, with the limits set only by the imagination and creativy of those who enter SL. More than 900,000 users have signed up to build homes, neighborhoods, and businesses in the free 3D online world. Some build virtual businesses, making clothes for avatars, for example; others sell plots of land. Some real businesses are joining, too. Starwood Hotels has built a virtual version of a new hotel chain in SL that it plans to unveil in RL (real life) in 2008. Some companies are conducting training sessions and meetings in Second Life.

Real money for fake things that sometimes turn into real things:

Something else that sets Second Life apart from other online games is it allows "residents" to retain full ownership of virtual creations, which has fueled Linden's market economy.

Somewhere between $350,000 and $500,000 in real U.S. dollars is spent user-to-user on Second Life every day. Players buy and sell goods and services using "Linden Dollars," which can be converted to currency in real U.S. dollars. The IRS truly is interested in this, and Congressional economists are looking into how to tax digital assets accrued in games such as Second Life and World of Warcraft.

Sometimes, popular online commodities in Second Life make the leap to Real Life. Creators of popular games in SL have licensed their games to flesh-and-blood video game companies.

Expect to stay awhile:

Reading accounts of others who have jumped into this unique online world, I've figured out it's easy to spend many hours there, learning how to walk, jump, teleport, and fly—yes you fly in SL—and jumping disorientedly from one venue to another.

I have yet to create my avatar and fly around Linden. Fellow blogger Robin and I have talked about meeting in SL, though we're both wondering how we'll find time for a second life when our first ones are pretty darn full.