Wednesday, October 10, 2007

Metaverse Skeptic

I've been an extreme skeptic when it comes to virtual worlds for a while now. I really can't understand how people can get excited about things like Second Life. None of the arguments for it as a great business seem to make much sense. The false scarcity markets for real estate seem quite misguided. I really enjoyed working with Forterra the other day- it's definitely richer than chat rooms and teleconferences in terms of communication- but is it richer than video telecon? In one way it is, because you can walk around and such, but that also imposes the limitations of the real world upon communication: you can't hear someone if you walk too far away.

I left a highly skeptical comment on James Au's post on 7 reasons why business execs should care about second life. There needs to be an Internet of sorts, so that the virtual worlds can, well, internetwork. You can't say Second Life is that important, because investing so much in something owned by another company is putting all of your eggs in one basket. It's like starting a company that builds Facebook applications- when (not if) Facebook gets acquired, your whole business model is in jeopardy. Better make a quick buck.

The world isn't just about open platforms. It's about interoperable platforms. One thing that makes adoption of new GIS systems possible is that the data can be transitioned from one to another because all of the stuff is connected to real world coordinates, and it is possible to translate from one coordinate system to another because the both refer to a place on the real earth. I am not sure what the virtual coordinate system is. With the Internet, it's the unified addressing and naming schemes. There can only be one on the public internet.

In this light, the iPhone looks really dumb. You can't install apps on it. Okay, WiFi works and the phone bit actually connects with the real phone network, but it's not an open platform. Few cell phones are unlocked to connect to multiple networks, but Apple seems to be actively discouraging this. To me, that's a sign of a bad business model- easily defeated. Just make the money on the device- not the lock-in.

It seems like the right business model is have an open and interoperable platform. It cuts off competitors, but allows you to benefit from the network effects of others innovations.