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021609 Millions Of Us Metanomics Transcript


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Metanomics is a weekly Web-based show on the serious uses of virtual worlds. This transcript is from a past show.

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021609 Millions Of Us Metanomics Transcript

  1. 1. METANOMICS: MILLIONS OF US FEBRUARY 16, 2009 ROBERT BLOOMFIELD: Hello, everyone. I’m your host, Robert Bloomfield, and on behalf of Cornell University’s Johnson Graduate School of Management and Remedy Communications, welcome to Metanomics. Today our guest is Reuben Steiger. Over the last five years, Reuben has catapulted from his role as a Linden Lab employee to serving as the CEO of the social-media agency Millions of Us. Millions of Us has evolved as well from being one of the first and most influential marketing firms in Second Life to building content in Sony Home and licensing celebrity-oriented virtual good through their affiliate Virtual Greats. As always, Metanomics is filmed from the virtual Sage Hall, right here in Second Life’s Metanomics region, thank to my real life employer, Cornell University’s Johnson Graduate School of Management. I’d like to say hello to our event partners Muse Isle, Confederation of Democratic Sims, Rockliffe University, New Media Consortium, Orange Island and Meta Partners. And I also want to say hello to our growing audience who’s watching the show live on the web. I see we actually have quite a few of you out there, and I see that many of you are not yet registered on the website. You’re showing up as guests. So for those of you who have trouble getting into Second Life, whether it’s a firewall or a lack of bandwidth, going to the web is a great option, You can see the show, and you can also participate in backchat through InterSection Unlimited’s ChatBridge system. But, for those of you who are not registered, my understanding is, you
  2. 2. won’t be able to use ChatBridge. So if you want to see the show on the web, please do register so that you can talk not only with the other people on the web but the people throughout our event partner locations. I’d like to say a special thank you to the couple dozen people who have shown up for our Metanomics Office Hours sessions. We’ve had two the last two Thursdays. We got some incredibly useful feedback on what you’re looking for in this series, what works and what we could do better. This week we’re going to do it again with the special focus on the show’s content and format. Do you want to see more focus on academic research, law and policy, new Virtual World platforms? How far should we step outside Virtual Worlds and how often? Should we be talking about all forms of social media, all forms of technology and business and policy? How about personal stories? Breaking new? What matters more to you, the topics or the guests? Do you like the interview format, or would you like to see more panel discussions? Or how about debates? Or, for all I know, there’s a big unmet demand for PowerPoint presentations. So anyway, come to our next Office Hours session this Thursday at noon, Second Life time, on the Remedy Sim, and tell us what you’d like to see. Speaking of breaking news, one of the content options on the list, our first guest today is Jade Lily, community manager of the Austin-based consulting firm Metaversality. But Jade is wearing another hat today, representing the board of directors of the 2009 Second Life Community Convention. It’s really an honor to have the first public announcement of SLCC here on our show. So, Jade, first, welcome to Metanomics.
  3. 3. JADE LILY: Thank you for having me on the show, Beyers. ROBERT BLOOMFIELD: It’s great to have you on. So let’s just jump right to the details. Where and when will SLCC be this year, Jade? JADE LILY: Actually, first of all, if it’s okay, I’d like to just go ahead and explain a little bit about what SLCC is for those people who haven’t heard about it. ROBERT BLOOMFIELD: And keep everyone in suspense; that works for me. If only we had a commercial to slip in, in between, but go ahead. JADE LILY: Okay. Second Life Community Convention is a sort of conference where people who are in Second Life can meet up. It’s filled with all sorts of sessions where people can share what sort of things that they’re doing in Second Life. In the past, we’ve had educational tracks where educational organizations have talked about how they have used Second Life. We’ve had business tracks and social tracks. So in general, it’s just a place where people in real life can go to connect with one another. ROBERT BLOOMFIELD: Well, my understand is that SLCC really just started out in 2005 as a bunch of Second Life residents who wanted to get together in real life, and, over the years, it evolved into a much more formal event, with, as you say, the business tracks. And last year, what, there was an entire sub-conference on education and keynote speeches by Philip Rosedale and Mark Kingdon. So are you planning to continue that trend or get back to the roots of just a social get-together?
  4. 4. JADE LILY: I think it’s going to be a little bit of a mix. And one of the things that we’re really trying to focus on is to have sort of a balance between a lot of the more rigid structure of having panelist discussions and also, at the same time, have a lot more social sort of interaction. Yeah, you can look forward to both of those things. And, if you’re interested in reading more about the history of SLCC, you can go to our website--and I believe we’ll have the link there in a little while--and there’s a section there that talks about how SLCC got started. ROBERT BLOOMFIELD: And that’s Is that right? That’s the website you mean? JADE LILY: Correct. Yes, ROBERT BLOOMFIELD: Okay. Now you’ve kept us in suspense long enough. Where and when? JADE LILY: We’re excited to have SLCC at San Francisco this year, from Thursday, August 13th, through Sunday, August 16th. And the location is the Marriott Hotel in San Francisco, but we don’t want people to go and book their rooms yet. We’re going to have a registration opening soon on the website, and when people get registered, they’ll receive a code for their hotel room so they’ll be able to sign up and book their hotel room at the same time as they register.
  5. 5. ROBERT BLOOMFIELD: Okay. I see the backchat seems happy about that. So cool. Yeah, San Francisco is great and should make it easy to get some Linden Lab representation there. JADE LILY: Absolutely. ROBERT BLOOMFIELD: And I also notice that you have an earlier time. Last year it was the first week of September, which I know caused some difficulties for people associated with education. Was that part of the thinking in moving it earlier? JADE LILY: Yes, I believe so. There was a lot of complaints about people who were going to be in school at that time, so that’s why we moved it back to earlier in August. ROBERT BLOOMFIELD: What is your role as community coordinator? JADE LILY: My role is basically to improve transparency a little bit into the planning process. I want to help to encourage and facilitate increased participation this year. We really just want to get as many people in Second Life involved in the planning process as possible. And so, along those lines, one of the things that I know already is, if you go to our website, along the side there you can see a tool that we’ve set up, that allows people to submit ideas for the convention this year. And once they’ve submitted an idea, anybody can go in and vote on the ideas they like the most. We don’t guarantee that we’re going to have everything that’s posted there. We can see what sort of ideas people like the most and try and implement some of those.
  6. 6. ROBERT BLOOMFIELD: Okay. Great. I assume you are still looking for sponsors and speakers and volunteers and the whole works. That’s right? JADE LILY: Absolutely. So if you go over to that user voice page and you can submit ideas, but that doesn’t commit you to actually planning. So if you want to get involved in the planning, you want to volunteer, what you can do is send an email to And we’re also looking for sponsors so, if you’re interested in sponsoring the event, we’re going to have some information out on the website about sponsorship as well. But, if you think you’re interested, in the meantime you can send an email also to ROBERT BLOOMFIELD: Okay. Thank you very much, Jade Lily, for coming on behalf of the Second Life Community Convention, and I, for one, hope to see you there. JADE LILY: Thanks so much for having me, Beyers. ROBERT BLOOMFIELD: My pleasure. Let’s turn now to today’s main guest, Reuben Steiger, founder and CEO of Millions of Us, a company dedicated to helping businesses understand and harness the power of Virtual Worlds and online communities. Reuben began this career path as a Linden Lab employee, with the colorful title of “evangelist.” He left Linden Lab to found Millions of Us, which contracted directly with companies that wanted to reach consumers in Second Life, companies like Toyota and Warner Brothers. But now Millions of Us has its focus elsewhere in Worlds, like Gaia Online
  7. 7. and Sony Home, and in licensing celebrity-based virtual goods through a new company Virtual Greats. Reuben, welcome to Metanomics. REUBEN STEIGER: Thanks for having me. I’m glad to be here. ROBERT BLOOMFIELD: We’re delighted. I’m really interested in hearing about all these different aspects of what you have been doing and what you’re doing now. I know that a lot of our viewers are going to want to know why Millions of Us is no longer so active in Second Life. But one reason, of course, is that there are big opportunities elsewhere, so what I’d like to do is start with those. And, in particular, one that’s very interesting to me is Sony Home, since I recently bought a PlayStation 3. There was a recent article in Virtual Worlds News that reported that you’re no longer a licensed developer for Sony Home. So I’m wondering if you could start by telling us what you were doing for them and then why are you no longer going to be. REUBEN STEIGER: Sure. We were hired--let me get this right--in late 2007 by Sony to build a lot of the content, I’d say substantially all the non-core Home content. So the Central Plaza, the Far Cry spaces, spaces for all the third-party games. And we spent [the greater?] part of a year building that and really enjoyed it. Had a fantastic time. And we’re not doing it anymore. So is there more that--tell me where you want to go with that. I mean I think there’s a lot in common with that and with Second Life, “Why aren’t you there anymore? Do you not love it? Do you not feel this way or that about it?” And the reality is that there are now 250-odd commercial Virtual Worlds, and we’ve been very, very bad, as a company, at finding the one that will work for us, to the exclusion of the other 249.
  8. 8. ROBERT BLOOMFIELD: One possibility is that you guys are well-positioned to come in, in the early stage, do something you do particularly well and then, as it becomes more routine, let other providers come in, take over your job while you go to the next new World. Do you see it that way? REUBEN STEIGER: Possibly. I think it’s a much more interesting question actually because I think there’s a lot of other questions to unpack underneath it, all of which are very interesting, if you think Virtual Worlds are interesting. So I assume we have a qualified audience where the answer to that is a hundred percent yes. I guess one thing I always hoped with Second Life--and I think this is probably true of this crowd--is that maybe we can do like an IM chat, virtual show of hands, but for how many people in the room today is Second Life your primary Virtual World platform as to [AUDIO GLITCH] time spent. ROBERT BLOOMFIELD: So just so you know, most people are watching this through a video stream, so it will take anywhere between 15 and 30 seconds for them to hear that and start responding. But I’m sure they will. Let’s let them. REUBEN STEIGER: While they start doing that, why don’t I just take a very tiny sample set with you. ROBERT BLOOMFIELD: Yeah. So for me, I hate to take the focus off you and put it on the interviewer, but I do want to say I got into this whole thing in the first place because I had a very specific goal I wanted to accomplish for my research, and I was looking for platforms
  9. 9. that would help me. So I looked at a bunch of different Worlds, and Second Life, very early on, appeared to me to be about the worst choice, but it was a great place for me to learn more about the industry and just to keep in contact with the people who knew about the other platforms and the technological innovations that would be coming over the next year or so. So for me, it has ended up being, in some ways, the place that I hang out waiting for that perfect World to be formed, which I guess I’m still waiting. REUBEN STEIGER: Yeah. Your description of it, I think, is fairly--without meaning to undercut your personal uniqueness--I think it’s fairly technical. And, what I mean by that is that, certainly in the IM sent, it is for everyone here as well; Second Life is their primary world. And that makes sense. The interesting thing is that it’s a very small percentage of the overall market, in terms of people. Growing. Certainly, I would say the most committed single population, but we all know that the bulk of the market is kids and teenagers. And often the use cases are not what they are in Second Life. So the interesting observation here is that Millions of Us, as a company, there’s many ways to describe us, but the easiest one and the one that’s most accurate, I think, is that we’re a company that gets paid to create very cool stuff, and, in general, the bill is footed either predominantly by an advertiser who feels a glow on their brand because they’re doing something very innovative or very interesting in environments that are atypical, or it’s paid by the intellectual property holder, whether that be a Sony or the owner of content that’s being highlighted within Sony Home. Second Life--and I think it bears going into this--in the first wave of hype around Second
  10. 10. Life, Second Life sort of failed as an advertising environment. And that, not more than anything else, that and that alone is why we stopped. We couldn’t do work in there anymore. And it was really, I think, attributable to two key things, both of which are fixable. One, for the most part, advertising is about aggregating attention. Right? So I don’t need advertising’s help to have a one-on-one conversation with you, but, if I want to talk quote/unquote to a million people like you, I need to advertise in some way, shape or form. And, in the entire Second Life experience, because it wasn’t built to enable reaching tons and tons of people, it was built to facilitate small groups like this, it never performed very well when measured against things like banner buys or television ad spots, in terms of just volume. It killed everything ever known to man, in terms of engagement. But the observation is that advertisers, they like engagement, but only if it’s in reference to how engaged the millions of people rather than tens of thousands were. ROBERT BLOOMFIELD: You see it primarily as a metrics and scale issue? REUBEN STEIGER: Well, metrics simply--yes, it’s a metrics and scale issue. I had to consider that for a second, but I do think it was a metrics and scale issue. I think that the second thing there that’s really interesting is that, while you’ve got metrics and scale, you’ve also got control. And interestingly, Second Life did okay in terms of control, meaning, if you’re a corporation, there are the thousand horror stories of you’re doing an event like this. You’re XYZ corporation and some [AUDIO GLITCH] comes up and starts launching self-replicating penis attacks. That, one would have thought, would have been the bigger hurdle, but I think that relative to what could have happened, Second Life did really, really,
  11. 11. really well in the area of control and not so great in terms of-- ROBERT BLOOMFIELD: Okay. We’ve got a bunch of questions already popping up, and I’d like to pass some of them along. One is from Dusan Writer, and that is: Do you see console-based Worlds having a future based on what you know about Sony Home? REUBEN STEIGER: Wow! First of all, I just got an IM from Latok Neumman--that’s awesome. “Console-based Worlds, do they have a future?” Yeah, they do have a future. Absolutely. The question there, I think, breaks down to--I’m going to start ignoring the chat as I’m speaking because I can’t devote-- ROBERT BLOOMFIELD: It does take a lot of practice. So if you’re willing, I will go through-- I actually have a staff who sends me the best questions and stuff like that. REUBEN STEIGER: Awesome. I will quell my curiosity. They absolutely have a future, for a variety of reasons, namely because there’s a huge audience using the consoles. Secondly, consoles are really, really good at synthesizing 95 percent of the things that make Virtual Worlds compelling. So I think you’re going to get Virtual-World-like experiences, meaning undirected, highly graphical, but not hierarchically imposed goal-based. So they might be about status. They’re broadly about socialization and co-discovering content with people and making friends. ROBERT BLOOMFIELD: Not slaying the giant orc and then [CROSSTALK].
  12. 12. REUBEN STEIGER: No, no, no, no, no. But the interesting observation, I think, is that, at least in the first wave of console-based Virtual World experiences, the unifying element is a shared interest in games. That’s what everyone has in common so a lot of the content, a lot of the social experiences are built around facilitating people to meet so that they can go off and play console games together and creating sort of a unifying scoring backplane so that context can be added to that. It’s so different than Second Life, and certainly, when I first started looking at it, I wanted to say that it would fail because so many of the truths that we hold to be self-evident as Second Life evangelists are really notably absent in the console-based Virtual Worlds like user creation of content. ROBERT BLOOMFIELD: Let me, if I could, I’d like to get you to put some of this in the context of the Gartner Hype Cycle, which I’m sure you’re familiar with, but some of our viewers might not be. We actually have a graphic of the Gartner Hype Cycle. It starts with a technology trigger, which causes the technology to become more and more visible until it reaches--and I love this term--the peak of inflated expectations. And then when those expectations are revealed to be unattainable, the visibility and hype drops down to the trough of disillusionment. And then, finally through the slow and quiet efforts to improve the technology and use it more intelligently, you see companies climbing up the Slope of Enlightenment toward the Plateau of Productivity. They must have spent a lot of time thinking of those names. But one of the things I’m wondering, especially being one of the first companies to come in and try to do marketing campaigns within Second Life, do you feel like you came in right at the peak of inflated expectations? Well, let me just ask that. Where do you think, when you
  13. 13. were doing your Scion and some of these other pretty high-profile ones, do you see that as being like just before the peak of expectations? REUBEN STEIGER: I don’t know. I can never think about how movements start effectively in the terms that, who was it, Gartner? ROBERT BLOOMFIELD: Yeah, Gartner. REUBEN STEIGER: Gartner. I can’t do that. It’s like, “I get it.” Tech makes something possible. We all get excited. We tell everyone we know. Then we feel hideously embarrassed because everyone who know shows up and the thing breaks, and we sit there sweating and crying and apologizing and saying, “It was so cool yesterday. You’ve got to see this.” Then they tell a lot of people that they heard about it. We’re insane; it doesn’t work. And then we lock ourselves in a garage and make it work. And then they come back, and they say, “Wow! It really was cool when you told me about it five years ago.” So I have no idea where we are in that slope. My perspective is, yeah, I’m probably to blame for a lot of the Hype Cycle. I got so excited about Second Life when I was first exposed to the idea, that I figured out how to devote my life to helping this become more widespread and helping people from a huge array of backgrounds understand how this would affect their life and how to do interesting things with it. I don’t know where we are. I do know that, from the perspective from which I look at it today, the hype is way over. I think you’re right that we’re sort of whatever that little squishy bit before enlightenment is called is probably where we find ourselves.
  14. 14. ROBERT BLOOMFIELD: Climbing the Slope of Enlightenment. REUBEN STEIGER: Exactly. Why do we have to climb it? Why can’t the Slope of Enlightenment go down to the playground of the glossy-eyed and weary? I think we’re somewhere. Right? My big observation today is that--I measure this by where everyone in my family’s head is at during the holidays, around Christmastime or Hanukah. I remember five years ago I told everyone that I was going to take a job at a company called Linden Lab, and they made a Virtual World called Second Life. And they all became very nervous. As long as I wasn’t being paid in virtual currency, then they would deal with it. But they’d never heard of it. It was endlessly exotic and scary. The following year, a lot of interesting things had happened at Linden Lab. We’d gotten growth to really move. We were over 100,000 residents, and there was a lot of Second Life in the news. And my family thought--probably didn’t think I was smart; they’re like, “Wow! The insane kid gets lucky again. Maybe he won’t have as big a humiliation here as we thought.” The year after that, Second Life had gone global. I’d just started my own company around it. People were hiring us. It was clearly a bigger movement. The year after that, it was now clearly much, much bigger, but advertisers had left Second Life. That year, three years in, two years ago, was the big aha for me because the big Christmas present was a Virtual World product. Right? Now, still, no one in the mainstream had a clue about Second Life. Right? It was way too much for them, but they were buying their kids Webkinz.
  15. 15. ROBERT BLOOMFIELD: Webkinz. Yeah. REUBEN STEIGER: Right. So it went from obscurity to the centerpiece of every family’s Christmas, in three years. And, for the most part, without explaining what the last two Christmases have been like, for the most part, that’s, I think, the interesting place in which we find ourselves now is, first of all, Virtual Worlds are pervasive. Secondly, there’s a set of core concepts and principles from Virtual Worlds that can be abstracted and are now broadly being applied to all forms of communication and product development. And, largely speaking, it’s an interesting thing to get into, but I think this has a lot to do with the fact that, over time, atoms get more expensive, bits fall to zero, and marketers, product designers, educators, humans are starting to learn which pieces of that thing that we call happiness can be virtualized and made more affordable and more universal. So I think it’s a really, really interesting time to be involved in all this, and I don’t know which way it’s going to break between now and next year, but I do think it’s an unstoppable process that’s going to keep-- ROBERT BLOOMFIELD: You’ve made a bet on one way that this is going to break, which is that you are now getting into licensing of distribution rights for celebrity virtual goods. REUBEN STEIGER: Yeah. ROBERT BLOOMFIELD: In December, I saw the New York Times had an article on Virtual Greats, which is--actually I’m hoping you can clarify, just for starters, on just the business
  16. 16. end. Who actually owns this company, and who are the collaborators? REUBEN STEIGER: This is Virtual Greats? ROBERT BLOOMFIELD: Yeah. REUBEN STEIGER: Okay. I should say, by the way, sort of laughing to myself when you said, “You’ve made a bet.” I make a lot of bets over the course of a year, and the one you’re talking about is a big bet, and it’s a multi-year bet. But, over the course of every year, when I look back on it, like last year, we made a lot of bets that didn’t pay off that I would have bet on again, I think, if I had the chance. We made a big bet on Lively. ROBERT BLOOMFIELD: What was the nature of that bet? Did you become a licensed developer for that? REUBEN STEIGER: Yeah, we became one of the first developers. I think we were the first. But the bet, broadly speaking, was kind of a silly one. It was, “Google plus Virtual Worlds sounds like it could work.” ROBERT BLOOMFIELD: Why do you think it didn’t? REUBEN STEIGER: I think it’s very interesting why it didn’t. I’d like to be very diplomatic in saying that the reason--
  17. 17. ROBERT BLOOMFIELD: No one’s listening so it’s-- REUBEN STEIGER: Yeah, right. The reason it didn’t work, I think, was that it wasn’t compelling to [end users]. The reasons why it wasn’t compelling are--I think it’s a very good case study because a lot of things did work about it, and some things that are absolutely critical for success didn’t. It also may not have worked because Virtual Worlds, at least in the Second Life model, need an extraordinarily long runway. And the Google let a thousand flowers bloom and cut the nine hundred and ninety that didn’t bloom into entire forests, let those die. Second Life wouldn’t have made it, according to those criteria. But I think there’s a lot of reasons to look. You’d asked about Virtual Greats, by the way. ROBERT BLOOMFIELD: Yeah, let’s get back to that. REUBEN STEIGER: Let me give folks the background there. Three years ago, 2007, two years ago now, statistics started to be released about the volume of virtual goods transactions across all Virtual Worlds. And this was at a time at which we were still very, very active in Second Life, which I should say we’re going to be again in the very near future. But we were still involved in Second Life, and we were also branching out and trying to understand which of the other successful consumer communities or emerging platforms were going to be very promising. And the stats came out that there was about a billion and a half dollars in virtual goods
  18. 18. transactions. And this came at a time when we were doing a lot of work with folks in Hollywood. What I found really noteworthy was that none of that, or substantially none of that $1.5 billion involved preexisting intellectual property. In other words, if I were to right-click on your shoes, they’re not Nike shoes; they’re a Second Life creator. Which is awesome, but I found it to be counterintuitive. That there wasn’t a market for stuff like, I don’t know, Pirates of the Caribbean merchandise, or the ability to be Jack Sparrow, or the ability to aspirationally become Elvis Presley. I just didn’t understand it. We went and looked at it, and what we discovered was that nobody had defined the legal rights that related to virtual goods. So what we did was, we defined the rights. We came up with a strategy to acquire them exclusively from some very iconic figures at the top of the market, with the hope that their endorsement of this new company and this new approach would drive the rest of the rights-holders towards us. And so we launched by announcing that we had the exclusive rights for Justin Timberlake, Tila Tequila, Paris Hilton, Snoop Dogg, 50 Cent, the Incredible Hulk and Elvis Presley, if Elvis-- ROBERT BLOOMFIELD: I’m guessing that mid-40’s aged accounting professors are not the target market that you’re trying to hit. It’s okay. You don’t have to answer that even. We see lots of Worlds where the whole World is tied to content, owned by the World developers. So you can think of this with, you know, Disney has some Worlds tied to the fairies from Peter Pan. Of course, then there’s Webkinz, which is an RL product in in-world content. So you’re trying to open this up and say, “Whatever World you have, we will have licensed goods that may be of interest to you. You can work these into your World.” REUBEN STEIGER: Yeah. Here’s the way it works now and--well, here’s the problem. So if
  19. 19. your Habbo Hotel or Gaia Online or any other at-scale World, if you want to, either for promotional reasons or for transactional reasons, offer Snoop Dogg stuff in your World, you have to get on the phone, call Snoop Dogg’s agent, perhaps then figure out that that’s not the right person. Then you go to their management. And then you have to convince, effectively, Snoop Dogg and his manager that they should care about your World that they’ve never heard about and so on. And then you have to negotiate a deal. Turns out it’s massively, massively time-consuming because these Worlds don’t really matter to these stars because they don’t represent individually a lot of revenue potential. And so our structure simply allows any World to tap into a catalogue or a library and use it as they see fit. Right? So they don’t have to argue with anyone or waste a year of their life negotiating for a single right; they can get them all. ROBERT BLOOMFIELD: So it sounds like one of the things Virtual Greats will bring to this is you’re going to do not only the legal work-- REUBEN STEIGER: So it’s interesting. The audience doesn’t like any of this. ROBERT BLOOMFIELD: I am kind of noticing that. REUBEN STEIGER: And I’ll challenge them on it. It’s very interesting. ROBERT BLOOMFIELD: Okay. Go for it.
  20. 20. REUBEN STEIGER: Folks see this in very binary terms. So one person said, “The good thing about Virtual Worlds is that it allows completely separate celebrity to work.” That’s true. That has nothing to do with this. Not everyone will want to be Torley Torgeson, to use an example, or pick your Second Life celebrity. So the reality is that the way in which we encode meaning and tell stories is a large industry, and it’s protected. So there, first of all, are a lot of people who want to use those elements of identity to express who they are. In fact, it is one of the most efficient ways to do so. It’s more so in Worlds that have less user creation rather than more. Secondly, I think a lot of people would think, “Well, you’re just sitting here,” and this is the new DMCA I heard someone say. ROBERT BLOOMFIELD: Yeah, I saw that. REUBEN STEIGER: I don’t think there’s a controversy to be had there. The fact is that, if someone’s going to pay for celebrity or just IP-related stuff, to not pay the IP holder is not legal, and it’s not possible to get to real scale and have it be done really beautifully without some sort of mechanism to fairly pay all participants. ROBERT BLOOMFIELD: I’d like to pick up a different aspect of this business. Part of this is just arranging the legalities, but a lot of it seems to be that someone’s got to go to Snoop Dogg’s whoever is representing him and not only work out some sort of reasonable deal, but also convince them that Virtual Worlds are even worth talking about and paying attention to. And, beyond that, if I understand you right, you’re going to go try to convince them to give you legal rights for virtual content. You’re not necessarily handing them a
  21. 21. specific World and a specific promotion. You’re saying, “Someday you’re going to want to do this. We’d like to nail something down now.” And then you would go sell that, try to work with the Virtual Worlds so they don’t have to think about the legal side. REUBEN STEIGER: That’s right. ROBERT BLOOMFIELD: That seems like a very hard sell to the celeb. REUBEN STEIGER: It is, which is good and bad. It’s bad for us, in that it doesn’t happen quickly. It’s good because it means we have a reason to exist. It’s considered a barrier to entry. ROBERT BLOOMFIELD: This is a Millions of Us rather than a Virtual Greats activity, I believe, but it seems like you got close to this type of business plan with the World Wrestling Entertainment’s SummerSlam in Gaia Online. So that was Millions of Us, right, not Virtual Greats? REUBEN STEIGER: That was. Yeah. ROBERT BLOOMFIELD: We’ve just been talking about celebrity. And I’ve also heard you talk about storytelling and the importance of storytelling in marketing and in engaging with people. I’m wondering if you could sort of pull these two together for me. How did you blend storytelling and celebrity to promote World Wrestling Entertainment’s SummerSlam in a teen Virtual World?
  22. 22. REUBEN STEIGER: What we did was, one Monday morning, the users of Gaia Online, which is a large Virtual World for teens, logged on to find out that someone had appeared on their forums and claimed that they had taken over the World. This person was one of the bad guys from the WWE. Over the course of the next five days, a drama unfolded essentially on the forums of Gaia, which is very interesting because Gaia has both a Virtual World, like the one in which we’re sitting in now, but most of the activity actually occurs on the forums, where people are speaking to each other asynchronously through avatars. So over the course of the next week, we essentially had a scripted drama, that was puppeteered by Millions of Us, unfold, in which the good guys and bad guys of WWE fought it out, where the users would rally support for them as it unfolded and show their affiliation by carrying virtual good related to the WWE, like the chairs that they break over each other’s backs or other pieces of virtual merchandise around the World to show whose side they were on. Over the course of it, it all sort of concluded on live television so you had to turn in to the purview to see how it played out. Close to a million pieces of virtual merchandise were taken, and most importantly, I think people loved it. ROBERT BLOOMFIELD: Fascinating story. You’ll have to forgive me. I’m just scrambling a little. You’ve kept me on my toes, so we’ve been changing around and trying to get the graphics to line up with the direction of the conversation. We only have a few minutes left, and I guess I have one quick question about the economy, and then I’d like to talk about your work with Byron Reeves. But first, on the economy, I know Advertising Age reported that--this was last week--77 percent of businesses plan to reduce their advertising campaigns’ media budgets in the coming year. I’m wondering are you feeling that? How are
  23. 23. you responding? Do you think that these sort of cutting edge forms of advertising can actually survive in this climate? REUBEN STEIGER: There were three questions there, and I’m not going to get the answers correct. ROBERT BLOOMFIELD: I do that. I never got interviewer training. REUBEN STEIGER: I’d say 77 percent is probably a low estimate. My guess is that 95 percent cut their budgets. I think that the kind of stuff we do, in terms of Virtual World marketing, if it hasn’t been cut already, it’ll be cut in the next two weeks. And what else was in the question? ROBERT BLOOMFIELD: Now there’s going to be fierce competition. I’m wondering if the headline is, “Virtual Worlds Lose Out Because Everyone’s Sending Their Advertising Dollars To The Most Traditional Outlets.” REUBEN STEIGER: Well, what are the most traditional outlets? ROBERT BLOOMFIELD: I know they’re leaving newspapers. I know they’re leaving TV. Certainly local TV. REUBEN STEIGER: Those sound like pretty traditional outlets to me. What, everyone’s going to put their stuff on billboards? The reality is that, during recessions, you have two
  24. 24. competing pressures that go on. One, you have no money to waste, so there’s a flight towards the most accountable media, whether they’re better or worse; it’s the most accountable. And generally, in our day and age, that means Google. Direct response. Highly actuarial. So you can actually say, “For every dollar I spent, here’s how much money I made.” And, if that equation is that you’re making $1.10 for every dollar you spend, then the logic is, you should just scale that until you have all the money in the world. Most advertising is not like that. So broadly speaking, what we’re seeing is that digital, as part of the advertising portfolio, is the only growth area. The fastest growth area within digital, in terms of consumer attention, is online communities or social media. And the third piece is that the economy is in the toilet. So you put those all together, and it just says that the market’s under huge pressure to be where people are and be relevant and to be spending their money responsibly. It’ll put a damper on the most sort of experimental things, into which camp I think probably Second Life falls, but it won’t kill the market. There’s a lot of places, broadly speaking, that advertisers don’t know how to capitalize on. And so I think these will be places like, “How do we be successful in Facebook? How are we going to be successful in Twitter? How do we talk to people instead of advertising to them?” Because, in general, that’s going to be the defining element for the entire category known as social media, I think. It’s that it just won’t obey the rules. The same observations you saw with Second Life, that it’s hard to get pure scale, which you can buy through advertising. Most of these media are not driven by those same forces. They’re not very excited to have messages thrown in front of them, and the question
  25. 25. becomes not how do I make this behave like something it’s not to get the numbers that I think I’m used to, but how do I learn to value radically different numbers differently, and how do I think long-term about using this broad class of technologies ranging from social media to Virtual Worlds to micro-blogging platforms, to do something that’s important, namely build a movement that might not be about my brand. I’m not sure people are dying to join the Pepsi movement. I think that they’re excited to join movements, and movements are things that often have very little to do with a brand, other than that the brand may have brought it to you. And, when a brand brings you a movement, meaning something you really care about that you’ll devote a lot of your time and energy and passion to, then that’s good for [AUDIO GLITCH]. That was a long rant. ROBERT BLOOMFIELD: That was. We will definitely make a clip of that for YouTube. It’s interesting, we’re getting very mixed feedback on the show topic itself. I think there are some people who, especially in Second Life, not wild about the marketing side, the consumer engagement side of business in Virtual Worlds. And we have Prokofy Neva calling you a genius and just saying I guess I’m not doing a good job asking the right questions, which, no doubt, is true. But, if I could, I’d like to change gears just to close by taking a look at a rather different endeavor that Millions of Us is doing in collaboration with Stanford professor Byron Reeves on the Green Energy Conservation Challenge. And, rather than try to explain it, we can just take a look at the video and then talk about it right afterwards. So, SLCN, go on and cue up that video.
  26. 26. [VIDEO BEGINS] ANNOUNCER: We’re all interested in helping the environment. Right? Recently I had a smart meter installed and found out a whole new way to do that. Smart meters are like regular electricity meters, except they can tell me just how much energy I’m consuming anytime online. So whether I’m online at home or on the go, I can see just how much energy I’m consuming. But that’s just the beginning. My smart meter connects me to a virtual home that gives me detailed information about how my house is consuming energy. I can even find information about how to lower my usage rate instantly. And then the real challenge begins because the smart meters let everyone see just how much energy we’re using and play a really fun game to compete, to make our home that much greener. Because, in this world, the only way to improve your virtual home is to lower the energy usage in your real one. And, with all the extra info about my energy efficiency peak hours and comparisons to similar homes, it was no problem finding quick ways to improve. When saving energy and the environment is this easy and fun, everyone wants to do it. And I finally beat my neighbor Frank at something. That’s his house. All this effort paid off, not just for the planet, but also four our pocketbooks. Once we knew how to conserve power, we started saving both energy and dollars. And once one neighborhood does something so amazing, pretty soon our whole town was green with envy, and all the neighborhoods were competing to be the best. People always say it’s hard to change set behaviors, but, as it turned out, all they needed was a really good challenge.
  27. 27. [VIDEO ENDS] ROBERT BLOOMFIELD: Reuben, that seems like a fascinating project. My understanding is that this is demo. Where do you see this heading for Millions of Us? REUBEN STEIGER: Where do I see the stuff we’re doing-- ROBERT BLOOMFIELD: The collaboration, yeah, with Byron. REUBEN STEIGER: I’m not quite sure. I sort of dreaded this interview, to be honest with you. I know I’m a bit of a polarizing figure in these audiences because I think one of the reasons is that people think what we’re doing is crass and commercial and devalues the important things that are going on in Virtual Worlds. I guess my view is what we’re really interested in doing is making what’s going in Virtual Worlds more and more real and giving it a bigger voice and a bigger platform on which to play. At the beginning I said Virtual World principles are just endemic, and I think this Byron Reeves stuff shows how you actually take Virtual World game feedback system principles and attempt to use them to change real behavior. And that’s a very big deal, I think. If we, not we as Millions of Us, but we as a population of people, as a community of people, are able to make people in the Real World more energy efficient, that’s massive. Or, able to promote more responsible behavior, that’s massive. So whether this project will come to fruition with Byron and a particular energy company is less important to me than will
  28. 28. this type of approach be able to be applied to a broad swath of industries and applications, and I think there the answer is, absolutely. ROBERT BLOOMFIELD: I think it looks fascinating. The video itself certainly makes a compelling case. So many people are into social games, and it really seemed to tap into their latent competitiveness. I just want to say, in closing, Reuben, thank you so much for ignoring your feelings of dread and coming onto Metanomics to speak your piece. I think it’s a fascinating take, and you guys have shown lots of successes. So I look forward to getting you back again and not too long, and you can tell us about your next success. REUBEN STEIGER: Thank you so much for having me. I enjoyed it. ROBERT BLOOMFIELD: Thanks a lot. REUBEN STEIGER: Bye, everybody. ROBERT BLOOMFIELD: So to our audience, I’d like to say, if you enjoyed today’s topic, there are a number of past shows you might find particularly relevant. If you found this topic annoying or objectionable, you should definitely take a look at these items from our archives. We’ve had a couple of interviews with competitors of Millions of Us. Electric Sheep Company’s Chris Carella, back in our first year, and Sibley Verbeck last fall. We also had a great discussion with K Zero’s Nic Mitham last August, who talked about a number of virtual marketing successes and failures.
  29. 29. I’d also suggest taking a look at one of our shows from the Virtual World, There, with Morgan Brooks, of CosmoGIRL, and Mary Ellen Gordon, of Market Truths, as we took a look at CosmoGIRL’s virtual prom. So I guess maybe the analogy to the SummerSlam, but for the fairer sex. So anyway, I hope you did enjoy this show and take a look at our old ones. We always close Metanomics with an opinion piece, Connecting The Dots. Connecting The Dots today is Tish Shute, author of the blog Ugo Trade. As someone who follows the business side of technology, it’s great to be able to rely on someone who follows the technology side of the Virtual World business. So, Tish, take it away. TISH SHUTE: Okay. Well, Rob, you said that that would be a good segue perhaps from the green gaming project to what I would like to talk about. I think it is because I think if you’d been anyone that’s been reading Ugo Trade, you’ll know that I’ve actually been turning my attention to the connection between virtual environments and real environments. I’ve always been interested in that, but I think, really, in the last six months, I’ve really kind of taken the bull by the horns and tried to look at that conversation. I know this is supposed to be an opinion section, but I think, really, this is a conversation. I mean how we connect real and virtual environments is really--it’s a conversation that’s just beginning. And I think, if you probably heard a number of terms; everyone’s heard these terms floating around there, the internet of things, the web of things, Bruce Sterling’s neologism of space and time--spines, S P I N E S. There’s another great term: Every Ware, spelled Every Ware, W A R E. And there’s a great book by Adam Greenfield that really looks at what the world of
  30. 30. Every Ware might be about and all the kind of things that we’re going to have to think about in a world of Every Ware. But anyway, I think a lot of people go, “Well, what’s this got to do with Virtual Worlds? We’ve just kind of got this so the thing doesn’t crash on the end-to-end internet, and now you want to take it like beyond the end-to-end internet.” But, this is happening, and I would argue, and this is the conversation piece, but who’s going to be envisioning this? Aren’t people who’ve spent a lot of time in these Virtual Worlds that, at the end of the internet, we’re basically stuck behind our PCs still? But, as this begins to move out and be not tethered to a single PC, but pixels anywhere is really another expression I’ve started to use, who better than to start this conversation than people immersed in this space? I think Reuben pointed out he doesn’t know where that conversation on green gaming is going. Because, clearly, how we make these connections between virtual and real environments is just beginning to be explored. So that brings me to a recent blog I did with a project called “patchbay.” It’s spelled Pachube, and a lot of people call it that. I call it patchbay because it’s sort of went around that that what it was called for a while. But you’re free to interpret. It’s something so new that its name even is flexible. But I think what’s important here and what is very interesting is actually Virtual Worlds have been the first to kind of step forward and become early adopters of something like patchbay, which really is about connecting environments. Not just real to virtual environments, but environments like web pages with objects in the World. If you want to know more about it, I’ve got an extensive blog. I interviewed the founder, Usman Haque. I think it’s an interesting project. If you don’t have time to read the whole
  31. 31. blog, look at Natural Fuse, which is his project of electronically assisted plants there. You’ll see how interesting this all starts to get when we’re talking to machines and machines to each other. [There’s a new?] system that goes literally beyond the traditional internet. Now I’m probably messing Lynn up drastically with the slide she’s got to put up because I’m adlibbing slightly. But there’s an important piece of this, I think, that Virtual World people might be the most interested in, and that is one part of Every Ware is how we link these environments together and the communications protocols we use to do that and how we see that evolving. The other part of this is, you know, what is the cyberspace that we useto--how do we relate to this new data everywhere, data coming from everything. And I think that this is where probably Virtual Worlds people and people in Second Life--you probably all read Snow Crash at least ten times--I don’t know whether all of you have read Halting State--but, obviously, Halting State gives you an idea of what cyberspace might be like when it’s everywhere, as opposed to being linked, something you sit at, you know, you sit at your PC and “enter.” Now basically I think one of the things that people have not really thought about a lot, and Virtual World technology has taken a long time to stabilize, but it takes a stretch of the imagination to think of mobility and Virtual Worlds all in one breath. And I don’t mean little light-weight Worlds on your mobile phone so that you just basically got a little mobile desktop. I mean pixels anywhere. I’m not sure if Lynn’s ready for this slide yet, but she has a link. Everyone, I assume, saw the Super Bowl ads. They saw this idea of ubiquitous
  32. 32. avatars, right? I’m not sure that everyone knows how damn close this is. I think, if there’s a link going to go up at some point of a little YouTube demo put up in 2/07 by total immersion, a little blue ape avatar, it’s around the corner, really, in many, many ways. Now that’s not to say it’s tomorrow, and it’s also not to say that some of the ways that we begin to link real and virtual environments won’t just happen using our PCs, using a platform like patchbay so that we can begin to do some interesting projects now. We don’t need these magical goggles and whatever to really get started with this. I think one of the things that is really interesting is that actually how quickly people who work in Second Life and OpenSim get this. You show them patchbay, and a very good example of this is the reaction grid folks, that, within days, they had got out some really amazing projects. I think, again, Lynn will put up this link so that you can go and see what they’ve done. And, plus, I think G2’s put up some very clear explanations how to use the code to--what you can do, what the protocol that patchbay is based on, which is called the extended environment’s markup language is about and what that facilitates. I would argue, and this is the conversation I’m sort of, “Why has my interest gone from Virtual Worlds more towards beyond the end-to-end internet and the internet things is because I think that, really, people who’ve experienced Virtual Worlds at the end-to-end internet and really positioned to do some very creative things now that we have really the pieces we need to really break our tethers to these PCs. Virtual Worlds should not be something that you just have to enter because you happen to be sitting at your PC. There’s something that should be there when you need them and where you need them. And, in fact, it’s quite critical that they’re there. Because, if you imagine a World of Every Ware, W A R E--Rob told me be careful when I say “everywhere” and “Every Ware”; it’s
  33. 33. confusing--how you can relate to that, what your data visualization, what your pixels are telling you about Every Ware is vital. Again, and there’s another interesting point that’s going to come up, and there’s a lot and a lot and a lot, and I see Prokofy’s in the chat here. She’s debated this endlessly. Well, not endlessly. She’s talked about this a lot. But the end-to-end internet has a very special relationship to identity. It gives you, because you basically have as a given anonymity, a certain amount of anonymity in the end-to-end internet. It’s freed us up to have lots of ways we can present ourselves, plus sitting at a PC where you have control of how you present yourself. It’s a very different situation to what cyberspace will be like when we really have it where we want it, when we want it. So the people who are kind of pioneering these visions, I think visionary architects have been key, I think in augmented reality, actually thinkers from games and Virtual Worlds are very key, that this is a conversation. I think it’s going to be interesting who kind of defines this, how it gets defined. And I’m happy to see people from Second Life and OpenSim. I think that, hopefully, Lynn’s putting up the links to Reaction Grid because it’s going to be a class there so you can get started. I’m thinking my time is nearly up. ROBERT BLOOMFIELD: That would be about right. TISH SHUTE: Yes. Just go get involved, and get started, and see where this goes. I think it’s exciting, obviously. ROBERT BLOOMFIELD: You spell out a fascinating vision, and I know I hear more and
  34. 34. more about the Halting State vision of the Metaverse, as opposed to what’s usually taken is the Snow Crash vision, with just lots of information flowing from devices in Real and Virtual Worlds, connecting them not in giant immersive ways, but in very small and penetrating ways. So thank you, Tish Shute, from Ugo Trade, for coming on and giving us a great look at the future of virtual technologies. Next week, we have Alice Krueger--some of you may know here as Gentle Heron--who works with the nonprofit organization Virtual Ability, and we will be talking about the challenges of engaging with Virtual Worlds when you have disabilities, and we will also be looking at the opportunities that Virtual Worlds and related technologies provide to those with disabilities. So I look forward to seeing you at next week’s show. Thanks a lot, and bye bye. Document: cor1050.doc Transcribed by: Second Life Avatar: Transcriptionist Writer