Second Life: A Real Digital U

Dory Devlin at Yahoo! Tech wrote a great piece today on Second Life.  If you don’t know what Second Life is, it’s not a moniker for retirement.  It’s a 3-D virtual world entirely built and owned by its residents, who reside in the virtual city of Linden.   You can’t get more digital than this!

Since launched by Linden Labs in 2003, the site has exploded to the point where Linden has approx. 900,000 residents.  That’s 900,000 users that at are spending real world money (after exchanging for Linden dollars) for virtual and real world goods and services.  At the time of this writing residents spent $433, 676 in the past 24 hrs! 

Essentially, once you sign up you can do almost anything in Second Life that you can in real life and some things you can’t (like fly!).  It’s pretty cool and is having real world effects.   As Dory’s article illustrates, Congress has taken notice.  With this much money trading hands it was inevitable that the government wants a piece of the action.

Check out the article on Yahoo! and if you have time go check out Second Life.  It just might be the life you’ve always wanted!

Done Deal: Google buys YouTube

Progressing from rumor to confirmation in only a couple of days, Google has bought YouTube.   It’s a $1.65 Billion all stock deal.  Congrats to the guys at YouTube!

My take is that this is great for both companies.  YouTube benefits from the Google tech muscle, having someone else worry about monetization, and the founders get rich.  Google becomes the leader in online video, something they haven’t done very well with Google Video, which is supposed to stay alive (at least for now).

 How Google deals with copywritten content on YouTube may ultimately make this a great deal for Google or not.  If they can quell fears of the major content players and monteize YouTube then it will be a huge success.   If on the otherhand, content kings NBC, Universal, ABC, CBS, and Fox get nasty then it may have been the worst $1.65B ever spent.

One immediate worry for Google may be Fox.  Fox owns MySpace, where video is exploding and may one day rival YouTube.  Fox also says that MySpace is responsible for 60-70% of the traffic enjoyed by YouTube.  MySpace already selectively allows outside links and if they choose not to play nice with YouTube then it could spell trouble for Google.

Of course, this is all speculation on my part.  Although Fox has said they were surprised by the deal, Google does have an advertising deal with MySpace.  I’m sure the Google team knows what they’re doing and will take YouTube to the next level.

The Consumer Revolution

I’ve alluded to what I call the “Consumer Revolution” in past posts.  What I mean by this term is that we have entered into a new era of the Web, and for connectivity in general.   An era where the consumer is king (or queen)! In 1995 Netscape brought the internet to the world.  In 1998, Google made it easy to find what we were looking for.  In a decade the web has changed our world. 

As the web evolved, the marketplace has as well.  Innovation in wireless technology, bandwidth, and storage spurred a new generation of mobile gadgets (MP3 Players, iPods, video phones, etc.), putting the web and all its power in the hands (or pockets) of people for use anywhere, anytime, any place. And now the revolution is here…The Consumer Revolution.   

First, Napster changed the music industry, then Digital Video Recording (i.e. Tivo and others) turned the television world upside down, and now T.V. is going broadband…..who wins?  The people! The web is a part of our daily lives just as much as music and television.  Here’s my take on it all….  Music Blazes a New Path…- Napster let us download music and challenged the establishment- The establishment responded by lawsuits but then realized you can’t fight the people- Napster goes legit, and Apple popularizes legal music downloading by giving us iTunes, and mobility by giving us the iPod 

Video is close behind… - Digital Video Recording gets popular, now people can skip commercials - People are spending an equal amount of time online as they are on T.V. - Advertising embrace the web – ads need to be where the people are!-  The value proposition of sending millions on T.V. commercials isn’t that compelling (when people are actually watching, they’re not watching commercials!)- Less money from T.V. sponsors has broadcasters moving content online….T.V. embrace the web! 

Mobilephones, iPods, Zune, MP3 players, etc.  Content is everywhere, anytime, any place.  To win over the consumer companies need to have an answer to the quintessential question of the Consumer Revolution: “I want what I want, when I want, how I want, and anytime I want.  Do you have what I’m looking for?” 

From Telco/Cable 4-Play bundles, Microsoft vs. Apple vs. Google vs. Yahoo vs. Web 2.0, business is innovating, aligning, partnering, and acquiring to have the answer.   But one thing is for sure, when companies compete we all win. 

Long live the revolution!