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Introduction to virtual worlds

Artesia whitepaper, September 2008

(c) Artesia ltd., 2008

Business impact of virtual worlds
"Public virtual worlds, which are suffering from disillusionment
after their peak of hype in 2007, will in the long term represent
an important media channel to support and build broader
communities of interest."

-- “Hype Cycle for Emerging Technologies, 2008”,

Gartner Research, August 2008

Virtual worlds are computer simulated environments that

are inhabited by multiple users in form of customizable
avatars (graphical representations), who can interact
Examples of Second Life avatars with the simulated textual or graphical environment and
other users. Virtual worlds are often seen just as 3D
multiplayer games or chat rooms, but are in fact also an
increasingly powerful education and business tool. The
sense of immersion and the depth of connection to other
virtual world users make them perfect for such diverse
activities as training medical, emergency and military
personnel, hiring employees, distance learning and world-
wide collaboration.
The number of personal and enterprise virtual world users
Training of emergency personnel in grows daily, with over 300 million users world-wide in
Fortrerra OLIVE 2008. Analytics forecast 2 to five years for mass market
adoption and 1 billion users in 2017, and new virtual
worlds are constantly being developed.
This whitepaper will introduce you to different types of
virtual worlds, provide examples and recommend steps to
help you and your company use virtual worlds to improve
your external and internal business processes and get in
touch with your target users.

“Within five years, the 3-D Internet will be as

important for work as the Web is today. Information and
knowledge management professionals should begin to
investigate and experiment with virtual worlds.” *

*Source: Getting Real Work Done In Virtual Worlds, Forrester Research, January 2008

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Virtual worlds types
Virtual world developers combine a variety of tools and
approaches to create engaging virtual environments. For
example, all virtual worlds allow users to communicate
with each other (usually through text, but voice is
becoming common too) and users can usually present
themselves through profiles that often feature
information about a user’s reputation within the virtual
However, not all virtual worlds enable players to own and
manage their own virtual land, although many include
virtual goods that players can buy or sell with an in-world
virtual currency. A few worlds allow users to create their
own content, while most focus on providing a limited set
of professionally developed content for users to consume.
Another distinction among virtual world is that they can
be modeled to resemble the real world or made to look
like imaginary non-existing worlds.
Therefore it is no surprise that there are many different
types of virtual worlds on the market that serve a
different purpose and are made to appeal to different
types of users. These are some of the basic types of
virtual worlds based on their main purpose:
Google Lively • Social virtual worlds focus on enabling conversation
among users and are often compared to 3D
chatroooms. They often include virtual goods that
users can buy, and some enable users to create and
customize their own virtual rooms or spaces.
Examples: Kaneva, There, Lively, Vivaty, IMVU.
• Casual gaming virtual worlds are very similar to
social virtual worlds with the difference that they
also focus on users playing smaller, casual games
within the virtual world. Examples: Club Penguin,
Club Penguin Habbo, Neopets, Dizzyworld.

Club Penguin is a virtual world for kids aged 6 - 14

that has over 700 000 paying subscribers and was bought
by Disney for 700 million USD

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1. • Role-playing virtual worlds or MMORPGs (Massively
2. multiplayer online role-playing games) encourage
players to assume a role in a themed world and
progress through the game by competing with or
4. against other players in a variety of quests in the
5. fictional environment. MMORPGs also include some
sort of in-game culture and provide different tools
for players’ social interaction and even team work.
7. MMORPGs often have a living economy that is based
8. on virtual goods that can be bought and sold with an
in-game currency. Examples: World of Warcarft, Age
World of Warcraft of Conan (fantasy themed); EVE Online, Ultima
Online (science fiction themed); Gaia Online.
• Virtual worlds for content creation enable users to
create their own content and in some cases also sell
it to other users. Due to the user generated content,
these worlds can be used for a variety of purposes -
from chat and gaming to education and even
business. Examples: Second Life, HiPiHi.
• Educational virtual worlds aim to educate their
users about a certain topic. Most often these worlds
Creating content in Second Life are targeted at children and offer similar features as
the casual gaming virtual worlds. Examples:
Whyville, Handipoints HandiLand, MinyanLand.
• Interest focused virtual worlds are focused around
users’ real world interests, such as sports, fashion,
music etc.. Examples: vSide, Stardoll.
• Branded virtual worlds are created around a certain
real life brand and can include elements of other
types of virtual worlds. Some branded virtual worlds
vSide require or encourage users to purchase a real world
product to be able to enter the branded virtual
world. Examples: vMTV, Webkinz, Barbie Girls.
• Mirror worlds are built to mirror the real world. They
can be used as 3D maps or to promote tourism.
Examples: Unype, Twinity, Amazing Worlds.
• Virtual worlds platforms are software frameworks
that enable users to create their own virtual worlds.
Some (mainly open-source) platforms even enable
users to host virtual worlds on their own servers.
Examples: Active Words, Croquet, Multiverse,
Project Darkstar, OLIVE, WebFlock, Metaplace,
Twinity OpenSim.

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Other virtual world distinctions
Virtual worlds also have different revenue models. Some
virtual worlds require users to pay a subscription (e.g.
World of Warcraft), while others are free to play and
make revenue by selling virtual currency that can be used
to buy virtual goods (e.g. Habbo), by selling virtual land
(e.g. Second Life) or any other premium virtual services.
We can also classify virtual worlds by the age of their
users. An increasing number of virtual worlds are
targeted at children (examples: Club Penguin, Whyville),
and many social worlds are made for teenagers
(examples: Habbo, There, Kaneva, vSide). There are also
virtual worlds that appeal more to an adult audience or
Habbo - a virtual world for teenagers that might even have age limits (for example, Second Life
works in a browser
users must be over 18, the average age is 33).
We should also keep in mind that virtual worlds have
different technological requirements. Some virtual
worlds that do not have full 3D graphics can be accessed
through a standard web browser by installing a plugin (a
lot of virtual worlds use the popular Flash plugin), while
fully 3D virtual worlds usually require better computer
hardware and the installation of a standalone software
client (application). Most advanced virtual worlds also
Second Life - users must be over 18 and
download the Second Life client require a broadband internet connection on the user’s
Intellectual property rights are not treated equally,
either. Second Life is the only major virtual world that
explicitly states that content creators keep the IP rights
to their content; in the rest, all content belongs to the
virtual world creators.
The final distinction is the hosting. Currently, most
virtual worlds are hosted on servers that are owned by
private companies, which poses some questions regarding
data confidentiality. However, there are already some
The OpenSimulator project can be used to (usually open source) virtual world platforms that allow
create and host a Second Life like companies and users to host their own servers (even
enviornment on your own servers behind the firewall). Examples: ActiveWorlds, OpenSim.

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External business opportunities:
connect with others
The level of immersion and the possibility of forging deep
relationships enable companies to successfully use virtual
worlds to connect with their users, customers and
business partners. Virtual worlds can be used in:
• Sales and marketing: Virtual worlds enable
promotion of sales of real life products and services,
creation of virtual world versions of real life products
and services or even of branded virtual worlds. Also,
promotional virtual events can be organized or
sponsored within virtual worlds. For example, users
Sony Home of Sony Playstation 3 Home will be able to dress their
avatars in Nike, Puma and other branded virtual
• External relations: Virtual worlds provide new places
where companies can interact with their users in a
more effective way and expand their business
network by connecting with new and existing
business partners. They can be used to provide
support, foster better relationships, and build
Showtime organizes regular events for fans communities. For example, Showtime’s hit TV series
of The L Word in Second Life The L Words has a thriving fan community in Second
• Recruiting: Virtual worlds attract many highly skilled
workers from different fields. Companies can use the
virtual world to connect with potential employees,
and conduct virtual job interviews or collect resumes
to select the most promising candidates. For
example, Cisco organized a Virtual Career Fair in
Second Life for engineers interested in working for
Cisco’s real world partners, and Luxembourg’s Virtual
job fair in November of 2007 drew 800 candidates
Luxembourg job fair from 45 nations.

"There have been some folks who questioned why we

would choose to participate in Second Life and I always go
back to this; before Cisco had presence in Second Life a
Cisco User Group the ‘go where your audience
is’ adage seems to ring true."
- Dannette Veale on the Cisco Virtual Worlds blog

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Internal business opportunities:
connect your employees
Virtual worlds can also be successfully used internally in:
• Meetings, collaboration and remote work: Virtual
worlds provide a collaborative immersive
environment that can be used to host meetings and
enable remote workers to keep in touch. Using
virtual worlds for meetings can be more cost-
effective than videoconferencing systems, can save
traveling costs and also provide an engaging
environment for informal social interactions within
A meeting in Forterra OLIVE the company. For example, IBM uses ActiveWorlds as
an internal virtual world for collaboration and also
holds informal and formal meetings in Second Life.
• Education and training: Virtual worlds can also be
used for highly realistic and cost-effective training.
Employees can also benefit by attending virtual
conferences that are less time and money consuming
than real ones, but still provide the benefits of
informal interaction and networking. For example,
A conference in Second Life Language Lab is a company that offers immersive
language classes in Second Life.
• Research and development: Virtual worlds can
provide a cost effective way for product prototyping,
testing and development. For example, Unimodal has
improved prototypes of SkyTran (a public personal
train transport system) by building and testing a
virtual model in Second Life.

SkyTran prototype in Second Life

“(Virtual worlds are important) because they provide

a level of human interaction and experience that is
increasing important in this disconnected world we live
in; plus they provide a platform for enhanced learning
and collaboration.”
- Zain Naboulsi, Microsoft

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Four steps to a virtual world strategy
So how should your company get started with virtual
Identify the most important business opportunity in
virtual worlds for your company. What goals can they
help you achieve? Are you a large multinational company
that can cut down travel costs by collaborating and
meeting in a virtual world? Do you want to reach your
consumers that are already using virtual worlds? Think
about what virtual worlds can do for you, and what value
you can offer to virtual worlds users.
Identify the right virtual world(s) for you. Consider your
target audience and your needs. Do you want to reach
your business partners or your end consumers? What kind
of environment do you need to reach your goals?
Find the right people in your company to get involved.
Maybe some of your employees are already using virtual
worlds and they can help you get started. Or maybe you
can find employees that are willing to learn and explore
this new area. If you can’t find the right people inside
your company, consider hiring some outside help to help
you focus your efforts.
Do something! The important thing is to get a feeling for
virtual worlds - start thinking about where your company
could fit in. Start by exploring virtual worlds or set up a
small presence. There is no need to invest big money in
your own Second Life island; you can start by joining a
dedicated business environment like the B2P business
park, get to know other enterprise participants of virtual
worlds and exchange experiences. Once you get familiar
with a virtual world, you can start thinking about bigger

Contact us for more information about

using virtual worlds!

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About Artesia
Artesia is a start-up company, focusing on the enterprise use of social media, user communities
and virtual worlds. We firmly believe that in the inter-connected business world of today and
tomorrow, the successful companies will be the ones that will use the evolving social media and
virtual world technologies to improve dialogue and add value to their customers, business
partners and employees.
Artesia is present in virtual worlds since the early 2007. Our projects include helping Slovenia’s
public broadcaster establish a Second Life presence and build a community, helping with new
user orientation, organization of dozens of virtual events and management of virtual
counterparts of academic conferences. We have forged strong ties with some of the premier
virtual world content, knowledge and service providers including Beta technologies, B2P
business park, and Metanomics.
Making sense of the jungle of social technologies can be hard. Our Artesia SocialMatch™
methodology helps our clients define potential value for the users and the company - which
parts of the business processes to enhance using social tools, define the best tools for the
project based on target users’ social profiles, develop the custom software, if needed, train the
company employees in the usage of the new tools and help them in the crucial first months of
the project. We were invited to present the SocialMatch™ methodology at the Mindtrek 2008
conference in Finland.
Our consulting services are completely adaptable to your needs - we have worked on projects
ranging from a few brainstorming sessions and a recommendation document to year-long
engagements with development of custom software. We’d be glad to help your company, too.

Jan Isakovic, CEO:, LinkedIn Profile, Skype: artesia-jan, SL: IYan Writer
Alja Sulcic, platform expert:, LinkedIn profile, Skype: alja-skype, SL iAlja Writer
Artesia ltd., Iztokova 16, 1215 Medvode, Slovenia, office: +386 590 64-063

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Other Artesia Whitepapers:

Business use of online communities

Artesia SocialMatch™ is a trademark of Artesia ltd. All other trademarks and trade names are properties of their respective owners.

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