0
EU-China Information Society Project


                  Virtual Worlds in Asia
                 Trends and Expectations

...
Foreword
Benjamin Joffe
 ベンジャミン
   벤자민
   本杰明
4 years

          1 year
                   4 years
www.plus8star.com
Cross-Market Consulting
Telecom & Internet Innovation
     China | Japan | South Korea
26 events | 98 speakers | 3,296 members | 1,440 companies
I am going to talk about
        1. What is a virtual world
        2. What are their origins
        3. What’s the market...
Chapter 1.
  What is a
Virtual World?
Before getting started…
Questions
Who uses Internet (almost) every day?
Question 2
Yesterday
Virtual World?
Problem 1
What does “virtual” mean?
3D Analog World
Without Server Lag?
Online / Offline
In-
Offline             Online
          between
Digital Immigrants
         &
  Digital Natives
Offline Audience: 300

Online Audience: >30,000
       (and counting)


     Factor 100!
Online + Offline = Life
Problem 2
What means “world”?
Avatars?
Video



[Superbowl Ad]
Key elements
   (1) Reach
(2) Reputation
Definition

  Persistent environment
Synchronous communication
     Personified users
Chapter 2.
  Origins of
Virtual Worlds
1981   1984   1992
The Matrix (1999)   Ghost in the Shell (1989)
LambdaMOO (1990)
Habitat (Lucasfilm, 1986)
Kingdom of the Wind (Nexon, 1996)
EverQuest (Sony, 1999)
Virtual World Types

     Platform
    Community
     Gaming
     Business
Chapter 3.
Market Situation
“It’s complicated”
>150 virtual worlds
In 2008, over US$580 million
were invested in 41 virtual goods-
       related businesses.
  Source: Virtual Worlds Manage...
Is it a business?
Revenue Scale

Online games = x 1,000 million
Social networks = x 100 million
 Virtual worlds = x 10 million
However: Convergence

Online games have revenues
Social networks have loyalty
 Virtual worlds have appeal
2D Worlds
Europe & North America
Daily Users: 495,210
Monthly unique users: 6.6 million across Facebook & MySpace
Service        Registered users   Revenue 2008 (E)   Valuation (E)
Habbo          100 mln            50 mln USD         1....
South Korea
Japan
Service          Registered users   Revenue 2008 (E) Valuation (E)
Cyworld          22 mln             200 mln USD       n...
China
3D Worlds
Europe & North America
(60% Made in China)
Japan
Internet
Adventure   Meet-me
(by SEGA)
Video



[Mii TV ad - 2007]
PS3 “Home”
25 million Xbox 360
 consoles getting
software upgrade?
South Korea
Video



[Nurien Demo]
China
Chapter 4.
  Trends
Trend 1
Away from Second Life
Gaming
               Mainly Second                             virtual
              Life adaptations                    ...
Trend 2
Browser
Browser   Hybrid   Client




2D
3D
Trend 3
Virtual goods
Business models
•   Virtual real estate
•   Virtual currency
•   Virtual goods
•   E-commerce
•   Advertising
•   Platform...
Chapter 5.
Legal Aspects
Trademarks
Patents
Forterra (There.com) vs. IMVU
Prior Art
Worlds.com vs. NC Soft
“System and Method for Enabling
Users to Interact in a Virtual Space”
            (7,181,690)
Will patents hurt the market?
    (“1-click” patent case)
Copyrights
Who owns what?
Facebook’s Terms of Service (TOS)

• “We reserve the right, at our sole discretion, to
  change, modify, add, or delete po...
Terms Of Service (TOS)
         vs.
     Regulation
Copyright? Civil rights? TOS?
Second Life Interview Incident
USA: Digital Millennium copyright Act
               (DMCA)

     EU: EU Copyright Directive
              (EUCD)
Subpoena?

Fair Use?
If the effort it takes to file
repeated claims is greater
than the effort to create an
account and repost a video,
then ce...
My expectation would be
that Linden Lab swiftly
research that problem and
close that loophole.

Otherwise it would raise
q...
Video



[User-Generated Music Video]
Commerce
of Virtual Goods
400,000 Gold Farmers
in China & South Korea?
Identity Management
“On the Internet, nobody knows
         you’re a dog.”




                      The New Yorker, 1993
“On the Internet, nobody knows
         you’re a bot.”




                        Wired, 2005
“Glider is a tool that plays your
 World of Warcraft character
 for you, the way you want it.



  It grinds, it loots, it...
Single   Multiple   Use of   Shared
account   accounts    Bots    account
Shared account
  Use of Bots




Whose persona?
Online & Offline Identities

        Real name
        Pen name
       Anonymous
Identity depends
on the social circle
Chapter 6.
More Complexity
Regulating virtual worlds is already complicated
              for service providers
There.com CEO joins the conversation…
       as a voice over his avatar
Video



[Fix8 Demo]
Obama Outfitted With
238 Motion Capture Sensors
For 3-D Record Of Presidency
…or not.
Lawrence
 Howard      Clay
                       Lessig
Rheingold   Shirky
Chapter 7.
The Digital
Third Place
What is a third place?
Economic activities
Creative activities
Cultural products
Social environments
Digital Third Place
Afterword
What Next?
Necessary skills
for the future?
Business is online
Online identity & reputation
    are most important
Increase awareness
      of the risks
and how to avoid them
Celebrate the benefits
About +8*
There are more ideas
outside your country
          than inside
                   Tom Kelley
                    CEO, IDE...
“Innovation Arbitrage”
• About us
   – +8* | Plus Eight Star is the leading cross-market and cross-cultural consultancy in...
Selected References
•   Adidas | E-commerce strategy for China, Japan & Korea

•   Bouygues Telecom | Cases studies of lea...
Social Contribution
• Mobile Monday
   – Founder of the Mobile Monday forum in Beijing since 2006 (3,000+
     members, 23...
Contact Us

www.plus8star.com

benjamin@plus8star.com
                                       +81 | Japan
benjamin0123     ...
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Virtual Worlds in Asia

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Presentation given at the workshop on 3D Internet in EU and China in Beijing in March 2009. It covers various examples of 2D & 3D virtual worlds, social networks as well as some interesting legal issues, to conclude with more abstract ideas about the "digital third place"

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Transcript of "Virtual Worlds in Asia"

  1. 1. EU-China Information Society Project Virtual Worlds in Asia Trends and Expectations Shaping and Governing the 3-D Internet Benjamin Joffe, CEO | Plus Eight Star | Beijing, 2009.03
  2. 2. Foreword
  3. 3. Benjamin Joffe ベンジャミン 벤자민 本杰明
  4. 4. 4 years 1 year 4 years
  5. 5. www.plus8star.com
  6. 6. Cross-Market Consulting Telecom & Internet Innovation China | Japan | South Korea
  7. 7. 26 events | 98 speakers | 3,296 members | 1,440 companies
  8. 8. I am going to talk about 1. What is a virtual world 2. What are their origins 3. What’s the market situation 4. What are the trends 5. What are the legal challenges 6. More complexities 7. The digital third place for 60 minutes
  9. 9. Chapter 1. What is a Virtual World?
  10. 10. Before getting started…
  11. 11. Questions
  12. 12. Who uses Internet (almost) every day?
  13. 13. Question 2 Yesterday
  14. 14. Virtual World?
  15. 15. Problem 1 What does “virtual” mean?
  16. 16. 3D Analog World Without Server Lag?
  17. 17. Online / Offline
  18. 18. In- Offline Online between
  19. 19. Digital Immigrants & Digital Natives
  20. 20. Offline Audience: 300 Online Audience: >30,000 (and counting) Factor 100!
  21. 21. Online + Offline = Life
  22. 22. Problem 2 What means “world”?
  23. 23. Avatars?
  24. 24. Video [Superbowl Ad]
  25. 25. Key elements (1) Reach (2) Reputation
  26. 26. Definition Persistent environment Synchronous communication Personified users
  27. 27. Chapter 2. Origins of Virtual Worlds
  28. 28. 1981 1984 1992
  29. 29. The Matrix (1999) Ghost in the Shell (1989)
  30. 30. LambdaMOO (1990)
  31. 31. Habitat (Lucasfilm, 1986)
  32. 32. Kingdom of the Wind (Nexon, 1996)
  33. 33. EverQuest (Sony, 1999)
  34. 34. Virtual World Types Platform Community Gaming Business
  35. 35. Chapter 3. Market Situation
  36. 36. “It’s complicated”
  37. 37. >150 virtual worlds
  38. 38. In 2008, over US$580 million were invested in 41 virtual goods- related businesses. Source: Virtual Worlds Management
  39. 39. Is it a business?
  40. 40. Revenue Scale Online games = x 1,000 million Social networks = x 100 million Virtual worlds = x 10 million
  41. 41. However: Convergence Online games have revenues Social networks have loyalty Virtual worlds have appeal
  42. 42. 2D Worlds
  43. 43. Europe & North America
  44. 44. Daily Users: 495,210 Monthly unique users: 6.6 million across Facebook & MySpace
  45. 45. Service Registered users Revenue 2008 (E) Valuation (E) Habbo 100 mln 50 mln USD 1.25 bln USD Gaia Online 7 mln UV/month 10 mln USD n.a. Stardoll 20 mln 30 mln USD 450 mln USD Club Penguin 12 mln 50-150 mln USD 350-700 mln USD
  46. 46. South Korea
  47. 47. Japan
  48. 48. Service Registered users Revenue 2008 (E) Valuation (E) Cyworld 22 mln 200 mln USD n.a. Mobile Game Town 12.6 mln 250 mln USD 1.4 billion USD Gree 8 mln 60 mln USD 1.2 billion USD Nicotto Town 100,000 n.a. n.a.
  49. 49. China
  50. 50. 3D Worlds
  51. 51. Europe & North America
  52. 52. (60% Made in China)
  53. 53. Japan
  54. 54. Internet Adventure Meet-me (by SEGA)
  55. 55. Video [Mii TV ad - 2007]
  56. 56. PS3 “Home”
  57. 57. 25 million Xbox 360 consoles getting software upgrade?
  58. 58. South Korea
  59. 59. Video [Nurien Demo]
  60. 60. China
  61. 61. Chapter 4. Trends
  62. 62. Trend 1 Away from Second Life
  63. 63. Gaming Mainly Second virtual Life adaptations worlds 2D dating 2005 2006 2007 2008 2009 2D worlds Variety of concepts and revenue models
  64. 64. Trend 2 Browser
  65. 65. Browser Hybrid Client 2D 3D
  66. 66. Trend 3 Virtual goods
  67. 67. Business models • Virtual real estate • Virtual currency • Virtual goods • E-commerce • Advertising • Platform licensing • Content creation
  68. 68. Chapter 5. Legal Aspects
  69. 69. Trademarks
  70. 70. Patents
  71. 71. Forterra (There.com) vs. IMVU
  72. 72. Prior Art
  73. 73. Worlds.com vs. NC Soft
  74. 74. “System and Method for Enabling Users to Interact in a Virtual Space” (7,181,690)
  75. 75. Will patents hurt the market? (“1-click” patent case)
  76. 76. Copyrights
  77. 77. Who owns what?
  78. 78. Facebook’s Terms of Service (TOS) • “We reserve the right, at our sole discretion, to change, modify, add, or delete portions of these Terms of Use at any time without further notice.” • Chronology of the TOS-gate – 2009.02.15 | Change in TOS – Facebook can do whatever it wants with the content – 2009.02.15 | Users uproar – 2009.02.17 | Back to old TOS – 2009.02.26 | Opens its TOS for input from users
  79. 79. Terms Of Service (TOS) vs. Regulation
  80. 80. Copyright? Civil rights? TOS?
  81. 81. Second Life Interview Incident
  82. 82. USA: Digital Millennium copyright Act (DMCA) EU: EU Copyright Directive (EUCD)
  83. 83. Subpoena? Fair Use?
  84. 84. If the effort it takes to file repeated claims is greater than the effort to create an account and repost a video, then certainly something is flawed.
  85. 85. My expectation would be that Linden Lab swiftly research that problem and close that loophole. Otherwise it would raise questions about how ready Second Life actually is for professional use.
  86. 86. Video [User-Generated Music Video]
  87. 87. Commerce of Virtual Goods
  88. 88. 400,000 Gold Farmers in China & South Korea?
  89. 89. Identity Management
  90. 90. “On the Internet, nobody knows you’re a dog.” The New Yorker, 1993
  91. 91. “On the Internet, nobody knows you’re a bot.” Wired, 2005
  92. 92. “Glider is a tool that plays your World of Warcraft character for you, the way you want it. It grinds, it loots, it skins, it heals, it even farms soul shards... without you.”
  93. 93. Single Multiple Use of Shared account accounts Bots account
  94. 94. Shared account Use of Bots Whose persona?
  95. 95. Online & Offline Identities Real name Pen name Anonymous
  96. 96. Identity depends on the social circle
  97. 97. Chapter 6. More Complexity
  98. 98. Regulating virtual worlds is already complicated for service providers
  99. 99. There.com CEO joins the conversation… as a voice over his avatar
  100. 100. Video [Fix8 Demo]
  101. 101. Obama Outfitted With 238 Motion Capture Sensors For 3-D Record Of Presidency
  102. 102. …or not.
  103. 103. Lawrence Howard Clay Lessig Rheingold Shirky
  104. 104. Chapter 7. The Digital Third Place
  105. 105. What is a third place?
  106. 106. Economic activities
  107. 107. Creative activities
  108. 108. Cultural products
  109. 109. Social environments
  110. 110. Digital Third Place
  111. 111. Afterword What Next?
  112. 112. Necessary skills for the future?
  113. 113. Business is online Online identity & reputation are most important
  114. 114. Increase awareness of the risks and how to avoid them
  115. 115. Celebrate the benefits
  116. 116. About +8*
  117. 117. There are more ideas outside your country than inside Tom Kelley CEO, IDEO The 10 faces of Innovation
  118. 118. “Innovation Arbitrage” • About us – +8* | Plus Eight Star is the leading cross-market and cross-cultural consultancy in Asia. – We provide local expertise & global perspective on mobile and Internet innovation from China, Japan and South Korea to add value to and accelerate the development of our clients’ businesses. • Our services – Analysis of proven best practices and business models from Asia – Other services: executive study trips, market entry strategy, M&A advisory, partners identification, negotiation support. • Founder & CEO: Benjamin Joffe – 9 years experience with mobile & Internet in Asia – Selected among “China’s Top 100 mobile industry influencers” in 2007 – Regular speaker at events on mobile and Internet in Asia – Fluent in English, Japanese, French with working knowledge of Mandarin, Korean and Spanish
  119. 119. Selected References • Adidas | E-commerce strategy for China, Japan & Korea • Bouygues Telecom | Cases studies of leading Asian Web 2.0 services and virtual worlds • Deutsche Telekom / T-Online | Benchmark of Korean mobile & Internet convergence strategies • Hemisphere | Analysis of mobile marketing best practices in Japan and South Korea (Hemisphere is a leading digital advertising agency), analysis of leading social platforms (SNS, virtual worlds, online games). • Microsoft | Analysis of Japan’s key players and market catalysts for mobile commerce market positioning in China • DeNA | Case studies of the best practices of leading social networks in China and South Korea (DeNA operates Mobile Game Town, Japan’s leading mobile SNS service) • China Mobile | Benchmark of Korean leading online communities • Sands Capital Management | Evaluation of China’s investment opportunities in social networks in China
  120. 120. Social Contribution • Mobile Monday – Founder of the Mobile Monday forum in Beijing since 2006 (3,000+ members, 23 events, over 80 presentations). • Media – Monthly column on Asian innovation for Asian Business Leaders (one of the leading Chinese business magazines), numerous interviews in international media. • Events – Regular keynote speaker and moderator at Internet, Telecom, Media and Investment events e.g. eComm, ITU Asia, Asia Venture Capital Forum, China Mobility International Summit, O’Reilly’s Graphing Social Patterns, Red Herring Asia, Media 08 Conference, Wireless Developer Forum, Open Web Asia, XMediaLab, Mobile Monday Global Summit, etc.
  121. 121. Contact Us www.plus8star.com benjamin@plus8star.com +81 | Japan benjamin0123 +82 | Korea +86 | China http://twitter.com/plus8star Telecom & Internet www.linkedin.com/in/benjaminjoffe + Added Value www.slideshare.net/plus8star * High quality
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