Second Life I : The Hype

Last december I was interviewed for Elseviers weekly, sort of the Dutch version of Time Magazine, regarding Second Life. In the past week the resulting cover story was published, which prompted me to write a miniseries about Second Life on our company blog. This and the coming posting(s) are translations of those postings.

The hype
Second Life draws a lot of attention recently, in fact is showing all the signs of hype.
Early 2006 there were roughly a hundredthousand registered accounts with SL. Now, a year later 2,8 million are registered, with the first million reached last September, and the second million last month. The influx of newly registered accounts is indication of the hype. Mainstream media is paying a lot of attention (see this graph), and big name companies (Philips, Nike, ABN Amro, Adidas, Toyota) are jumping to get in.
Not that all those registered accounts represent actual returning users. Estimates are that there are between 200 and 400 thousand of those. And that means that there is a chance that there isn't really much to get from SL yet. Or is there?
The first anti-hype sounds can be heard around the net, and in the media. Especially after Clay Shirky's critical and necessary review of SL's statistics as reported by the media and not corrected by Linden Labs.

Big Brother in SL, attempt to cash in on the hype

Looking beyond the hype
There is more to SL than just hype. Companies moving into SL, and those originating there, do not do so without reason. People that already are earning (part) of their income through SL are at least witnesses to the potential (not to say that as always the pron and gambling industry have been paving the way in this new medium)
I have seen the value of the in-world transactions between SL residents rise from about 300 thousand US$ per 24 hours in August to 1,2 million US$ now. And the couple of hundred thousand real residents of SL at least seem to derive a lot of fun from it.

Active residents and turnover on Jan 22nd 2007

PR bonus
That a lot of companies seem to be jumping on the bandwagon regarding SL is I think due to the fear of missing out on an important development again. They want to avoid being late discovering and capitalizing on opportunities, just as they did when the Web first came up in the first half of the nineties.
The return on investment at this stage for those companies moving into SL is the PR bonus that they get as being perceived as 'first movers'. They both feed the media hype, as well as they are being fed by the media hype. Perception trumps facts. ING bank for instance had been experimenting in SL low key for months, when competitor ABN Amro came in with a lot of fanfare and cashed the first mover PR bonus as the 'first' big bank in Second Life.

ABN Amro, first mover PR bonus despite ING's efforts