Second Life, Trion, and the ‘War’

Capn needs to watch his mouth when he is around journalists. This is something of a public apology to the Lindens for the quote from me in this Red Herring article on ‘The War to Build the Next Warcraft’; ‘Using Second Life is like having teeth pulled’ is not entirely fair. It’s a lot more fun than that (unless they give you the really good drugs at the dentist).

Linden continues to do really cool things. They open-sourced the client (Susan’s take) and just released some really great, detailed numbers (Raph’s analysis is useful). On the latter, my estimates of their revenue were higher than Raph (I probably booched the math) but given our relative concurrency user numbers (impressively they are up to ~4-5x us, vs ~2x in the summer), Puzzle Pirates and Second Life seem to have similar ballpark average revenue per user. The recent growth is fantastic; go Linden!

Back to the Red Herring arrrticle, I am also bemused by the authors implication that we have had ‘much more luck’ than Runescape. Our 30,000 paying customers (it’s actually a fair bit more than that, but it depends on how you slice it up over time; PP has had over 80,000 paying customers over its lifetime) by no means indicate more ‘luck’ than Runescape’s 900,000. I’d like a slice of their ‘luck’, myself.

I find myself a little baffled by the business plan of ‘Trion World Network’. It’s still in stealth, but what they do say is something like ‘top quality online games for broadband’. I am of course very much on-board with there being a big distinction between an online service oriented company and a packaged goods publisher, and I can forsee that Electronic Arts (the CEO’s former employer) may continue to acquire companies that succeed in this paradigm. However, EA aren’t all that bad at online stuff; after the debacle passed they’ve done a good job managing Pogo, and now they now have Mythic. They just bought SingShot, too; Sims Karaoke, anyone? I’m not sure what the big difference in experience (not distribution, which is important certainly) for a player is between a pure download game and the box-purchase with regular patches. I’m very skeptical of streaming solutions, as they mostly seem to produce a patchy (ha ha) experience that gamers won’t stand for. It’ll be interesting to see how Trion and competitors Multiverse, shape up in the field of battle.

Naturally the Capn remains aghast at the budget requirements of (presumably) Trion and Red5. Excuse the play on the name, but to an investor, to me it looks like this; if you’re okay with putting down $10M (out of, say, $40M) on red 5 then waiting four years or so to see if the roulette wheel comes up, great! You might win big (especially if you can do that scream thing like in Run Lola Run, ~6.40 mins in)… but this seems like a odd kind of bet for a venture investor to make. As Gus Tai says in the article, VCs have historically shied away from such content bets because they realise that they are not publishers and do not have the skillset to make judgements about what might succeed in the marketplace — let alone the marketplace four years away. Anyway, I’ve blogged about the insane competition in the MMORPG market before. We’ll see who is left on the battlefield… in a few years.

Finally, they end the article with a quote from me about a ‘ten year battle’. I believe that in this case I was referring to specifically the player-created content ‘virtual world’ space, not entertainment. I hope that entertainment worlds are not a winner-takes-all business. I think that would be a shame, although it certainly looks a bit like that right now with WoW. However, open-platform virtual worlds are likely to have some kind of network effect properties that lead one to dominate the landscape. I think that it will be a long and bloody conflict before a world emerges the winner, and I strongly believe that it will only a deeply open platform that succeeds. I think Linden agrees with me, which gives them a whole lot of legs in the struggle.

One of my favourite meetings ever was in Silicon Valley with a very famous and successful entrepreneur who was interested in buying Three Rings. He quoted Sun Tzu to me, something about taking the high ground and forcing your enemy into the swampy lowlands. I hope Three Rings can keep to the higher ground, if I can keep my feet out of my mouth we might just make it up the hill.

2 thoughts on “Second Life, Trion, and the ‘War’”

  1. I have never been able to understand people who use “luck” as some sort of statistic to used in quanitative analysis. This isn’t D&D, you can’t roll yourself a few more paying customers. Anyway, I raise my mug of rum to you!

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