Tuesday, January 25, 2011

2013 BIZ: S-tech is here. E-tech is last year

S-tech, the social internet, and 
the future of virtual worlds 
S-tech is the social sciences: Economics, Sociology, Psychology.
Electronics don't buy things. People buy things.

Start with 2 key concepts:
Community: "The word is often used to refer to a group that is organized around common values and social cohesion within a shared geographical location." Or, we might add, shared virtual location.
Network effect: "In economics and business, a network effect (also called network externality) is the effect that one user of a good or service has on the value of that product to other people.
The classic example is the telephone. The more people own telephones, the more valuable the telephone is to each owner."
And the more people on a given network, the harder it is for a competitor to survive. Here, the phone system is not a great example anymore, because there are now legal requirements to support interconnection across networks.
To put this in e-terms, voice over the internet has been technically feasible for years. But it was limited to geek-to-geek transmission. You couldn’t call you grandmother on it.  Skype arranged to connect to land lines. Now people are using Skype to replace their land lines. Pure network effect. The value of using Skype grew hugely with the increase in the size of the network.
Now put this in Second Life terms: People tell me about e-tech improvements in virtual reality. They seem to think that these e-tech improvements will create something that can compete with Second Life. But most of us are not using SL because we like e-tech. We are using it – wait let me put that in big letters so that King George can read it without his glasses
We are using Second Life because we value creative collaboration with our friends.
We have creative communities in Second Life—many of them. And most of us will react to an other virtual world just as I will:
“I am not interested unless my friends go there too.” 
In other words, the network effect strongly favors an entrenched monopoly over a competitor, even if the competitor has better e-tech. The competitor needs to be vastly better or vastly cheaper to have any chance in that game.

Second Life = f(community ^ social network) ^ virtual reality
How durable is that network effect?
The network effect in Second Life is not as durable as that famous effect that so nurtured AT&T. Second Life is made up of many networks. It is lumpy. Communities form strong networks. But the communities are not all strongly connected. Some pieces could break off and run their own world.
Some communities that are not likely to break off:  The rail and the sailing communities.
- Rail Buffs Alert: Virtual Railways Await Your Hand on the Throttle

These communities are recognized by Linden Lab and get cooperation, for example, in the use of Linden land and water and in the assistance of people like Michael Linden.  This is an example of how Linden Lab can work effectively with communities to retain residents.
On the other hand, part of the education community is already establishing bases in other virtual worlds. Here is some background to that:
As I suggested previously, the shift of much educational activity to OpenSim was inevitable.  But the actions of Linden Lab last October did distress the educational communities and  have the effect of hastening the diaspora.   Second Life can still play an important role in the development of virtual worlds for education--because that network effect still counts when educators need to reach out of their local communities.  Second Life can be central meeting place for many educators, something like a perpetual conference, where educators go to
  • Exchange ideas,    
  • See, learn, and try new methods,
  • Find out about resources,
  • Recruit personnel 
  • Look for jobs.

  • What do we do in Virtual Worlds? 
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  • Annotated screen shots made with Jing
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