Virtual Worlds, Real Profits

Is Gambling Legal in Second Life?

rmiller — Fri, 12 Jan 2007 19:56:12 +0000

The Bush administration insists that Internet gambling violates U.S. law, to the point where last July federal agents arrested BetonSports.com CEO David Carruthers when he was changing flights at Dallas/Fort Worth Airport. If it’s illegal for U.S. residents to gamble online, what’s the legal status of an online casino in Second Life? The Second Life Herald has the story of how SL resident Magnus Rothlisberger recently lost 346,180 Linden dollars playing virtual blackjack and roulette - a sum which at current in-game exchange rates is valued at roughly $1,153 real U.S. dollars.

Valleywag quickly jumped on the issue of whether this might leave Second Life open to scrutiny from the feds:

Reality check: there’s only one reason to prefer the crude Benchmark-backed 3D environment over a purpose-built online casino. The Department of Justice, which tracks down online gambling in the US, and Paypal, through which many Second Life users fund their accounts, simply haven’t grokked yet what’s going on. If the online casino was ever busy, it would be shut down in a moment.

Terra Nova recently predicted a major Second Life backlash this year. Looks like Valleywag will continue to lead the charge.

SL, Open Source and A Connected Metaverse

rmiller — Tue, 09 Jan 2007 04:36:06 +0000

In the wake of Linden Labs’ widely-blogged decision to open source the code for the Second Life client (desktop) software, Steve O’Hear at ZDNet looks at a more intriguing possibility: opening the code for the Second Life server grid and allowing virtual worlds to interoperate. The concept isn’t novel, as there have been Terra Nova discussions on the subject dating back to the 2004 Game Developer’s Conference, including the possibility of portable profiles and the exchange of meta-data (Peter Molyneux of Black & White fame put this forward). Ted Castronova discussed these possibilities at length in his excellent book, Synthetic Worlds.

What might this mean for virtual economies? The notion of an interconnected marketplace for virtual currency and assets has been part of the discussion for years. The Gaming Open Market created a marketplace where players in one virtual world could exchange their currency for the coinage of another world. The GOM later closed when Linden Labs opened its own official currency exchange for Second Life. Maybe they’ll open source some client code. But history suggests that Linden Labs isn’t likely to open source its currency market, having been there once already.

Tracking Real Money Trading in Second Life

rmiller — Mon, 08 Jan 2007 05:42:05 +0000

Prompted by Clay Shirky’s recent coverage at ValleyWag and Many to Many, many bloggers and virtual economists have been re-examining growth in Second Life, which has received more mainstream press attention than any online world except World of Warcraft. This is due to its innovative approach and focus on real-money trading (RMT) of virtual assets users create in the world, but also boosted by claims of rapid growth and the first “virtual millionaire” (the SL real estate maven Anshe Chung).

To expand the metrics for evaluating Second Life and its importance, Tristan Louis set out to measure economic activity in the game, and has some intriguing findings, notably that power users are spending about $50 to $60 a week in the game. As Wagner James Au notes at GigaGamez , this suggests that Second Life is “people light but cash heavy.” Tristan’s post prompted a back-and-forth with Clay in the comments, which is worth reading.

What’s clear is that they tout it or trash it, journalists will continue to cover Second Life, and it will continue to be an intriguing petri dish for the virtual economy.