Six Pixels of Separation - The Blog
October 17, 2008 2:37 PM

Third Life For Virtual Worlds

When was the last time you thought about the online virtual world, Second Life? Most of our attention shifted out of Second Life over to Twitter and FriendFeed.

It turns out virtual worlds are not dead.

According to this news item from Virtual World Management, $148.5 Million Invested In 12 Virtual Worlds-Related Companies in Q3 2008, things are still rocking and rolling in the virtual worlds:

"Virtual Worlds Management, the leading virtual worlds trade media company, has announced findings from a comprehensive study of accountable transactions showing that venture capital and media firms have invested more than $148.5 million dollars in 12 virtual worlds-related companies during the third quarter of 2008 with participation from many more VC firms and angel investors. The total investment in the virtual worlds space for 2008 is now over $493 million... The bulk of the investment is in the entertainment space, with all but $22.4 million going to developers of worlds with strong gameplay elements, ties to media brands, or the youth sector."

By the sounds of this, someone, somewhere is drawing lines of distinction between pure-play games and virtual worlds.

This begs the questions: is Club Penguin a game or a virtual world? What about Webkinz?

One of the main differentiations of Second Life was the fact that it was, indeed, not a game. It was a place to socialize and virtualize a new life. By all counts, this was the main driving force behind why businesses and brands dove on in. Otherwise, the dollars would have been allocated via their in-game ad spends (if they even had one).

If virtual worlds want to go from the gaming side to the business side, these distinctions are going to have to be made much clearer. After reading this news item, I'm a little confused.

Do you think businesses are going to jump on in or are brands looking for something more?

Is the next iteration of virtual worlds really just a sub-category of the gaming industry?

By Mitch Joel