Let’s imagine just for a moment that the problem with Second Life (SL) isn’t that people can copy textures. Let’s imagine that the problem is that the business models are wrong, and that IP maximalism is seductive but has been proven to be counter-productive wherever it has been tried.
What Second Life Is
SL’s appearance as an imaginary physical world has confused people into believing that it isn’t a service and that what goes on inside it isn’t services. Its frontier feel has confused people into seeing it as a socially and economically open world rather than a walled garden. But make no mistake, if you want to make money in Second Life you have to recognise that you are providing a service within a walled garden.
People can copy textures, models and scripts but they can’t copy reputations, the details of experiences, or out-of-Second-Life value. And we’ve learnt a lot about competing with free, getting people to pay for “free”, and rearranging revenue graphs to turn negatives into positives. So let’s apply this, rather than dreams of an in-game DMCA, to the problem of how to invigorate monetization of SL.
Rather than entering into an arms race with piracy, enter into it an arms race with changing tastes. Charge for convenient access to timely and compelling streams of content. Learn from ringtone companies and licenced music stores, who make millions from music, games, and images that could otherwise be copied from the Internet or pre-owned CDs.
Servicising Regions And Sims
Rather than applying locks to textures, apply gates to areas. Theme parks, game zones and other experiences are worth money in-game as well as in real life. If locking out regions of sims offends people, just have pay-access sims. People pay for access to SL, so this is hardly unprecedented.
Charge for “alternate reality games” in-world, charge for night clubs and party events, consider that the escort industry has done well in-world, consider whether the Elvish or Furry communities would pay to access or take part in a spectacular event. Give the dance mat away and charge to play in the league.
Amazon and iTunes don’t charge you for access to their sites, reading their reviews or reading or listening to some of their catalogues. They make money by using their virtual storefronts to charge for the delivery of real-world value. The same is true for ticket and travel services and for all the other service and product sellers that we used to call ecommerce. Build eCommerce in SL. We had a practice run of this with VRML.
Franchising And Commissions
Rather than worrying about how to get people to pay you for your work, pass that challenge on to other people. Start franchise operations for copies of your environments or objects and charge for setup or services, or let people sell on copies of your work for a commission.
Change The Revenue Graph
Treat copying of your work as a reduction in distribution costs for your client’s promotional materials. Keep your salt sellar handy and read the “Free” article in Wired. Use indirect monetization.
Look at how Facebook apps work. They access the in-world data and add out-of-world data to create value. SL objects and environments can do that as well.
Compare Second Life to MySpace. Both are “user-generated-content”, with some corporate content included. Compare Second Life to FaceBook. Both are social networks with third-party applications included. Compare Second Life to Livejournal. Both are hosting companies for records of people’s activities. And all monetize this through advertising. I’m not suggesting advertising blimps over Luskwood, or Goreans getting tattoos from sponsors, but there’s much that can be done to improve both the concept of what advertising is and how to make money from it in SL.
If a single work is easy to copy, ten thousand are not only difficult to copy but more difficult to find exactly the right one in. Create large volumes of content generatively and charge for providing the right one (see also Bespoke Services and Servicising Content).
Bespoke production and customization are as valuable in in software and music as it is in SL. People aren’t going to stop paying for the right modified objects, skins, and environments just because they can get the wrong ones for free.
Brands and Exclusivity
Work to establish your products and services as an exclusive brand, learning from the fashion world that counterfeit copies are reputational network effects for your originals.
Business As Usual
Bespoke builders are making money in SL. What is preventing them making more money is the lack of clear objectives, metrics, and in-world value narratives for their clients. Another generic corporate information centre isn’t worth anything to avatar or executive. But building (which includes modelling, texturing, scripting and populating) for individuals, groups (in-or-out-of-world), institutions and corporations is SL’s goldmine if people can just get it right. It isn’t texture copying that is stopping this.
Gatekeepers and Intermediaries
Provide the SL equivalent of reports or collections, whatever that might be. Embody and sell trends (see Servicising Content).
But I Just Want To Get Rich Writing Code And Texturing Prims!
I have explained precisely how to do that. All of the above need code, models and textures. You just need to do the work of selling them as something people actually want to buy.
Second Life And OpenSim
Once you start treating people like thieves they treat punishment for theft as a cost to be borne not a disincentive to be avoided. Second Life is, like the blogging and social networking sites, a user generated social environment that commercial and corporate activity can learn to monetize part of at various levels of indirection. *If* they don’t destroy the neighborhood. The user-generated aspect of Second Life, however inept it may lead to vast swathes of the world appearing, is its purpose and its value, not an inconvenience and an impediment to monetization.
Far from those who support in-world freedom fleeing to OpenSim, I think that corporate users will start using OpenSim to make their own walled gardens that they can add value to and charge for, much as Linden Lab charge for access to the UGC value of Second Life. This will raise its own problems for freedom, but that is another story.