Monday, January 22, 2007

The Second Life Goldmine: Sam Palmisano

CNNMoney gets some money quotes from Sam Palmisano, CEO of IBM.


"By early January more than 3,000 IBM employees had acquired their own avatars, and about 300 were routinely conducting company business inside Second Life. "The 3-D Internet may at first appear to be eye candy," Palmisano writes in an e-mail interview, "but don't get hung up on how frivolous some of its initial uses may seem." He calls 3-D realms such as Second Life the "next phase of the Internet's evolution" and says they may have "the same level of impact" as the first Web explosion.

But what's beginning to catch the attention of IBM and other huge corporations is something potentially far more profound than a new online pastime. It's the ability to use Second Life as a platform for a whole new Net - this one in 3-D and even more social than the original - with huge opportunities to sell products and services.

In essence, (Linden Lab's) customers are renting space on the 1,750 servers that store the digital representation of the land. One of the biggest landowners is IBM, which rules over 24 islands. Since Linden revamped its business model to focus on real estate, users and revenues have grown at least 10 percent every month.

Easier said than done, of course. Metaverses will become a very competitive field, says Irving Wladawsky- Berger, vice president for technical strategy at IBM. These are just the earliest days of exploration, and needless to say, the outcome is anything but certain. "Today," says Wladawsky- Berger, "virtual worlds are where video and VCRs were in the early 1980s, or where the Web was in 1993."

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