GotMMOG?

It seems Linden Labs, the company that built and runs Second Life, is restructuring–which is a nice way of saying they’re tossing some people out on the street. The question is why? Supposedly, they cleared 30% more transactions (of which they get a small cut) year-over-year in the first quarter of 2010. In other words, a company that’s seeing solid growth in a time when people are cutting back on non-essential items (though entertainment tends to be somewhat essential at times like these).

At the same time, you could argue that the company’s been around for about 11 years and it’s about time they cleaned up any inefficiencies in the org, especially during a recession (and a supposed decline in virtual worlds subs/activity). They’re also talking about the Web. With all the players out there setting up engines in Web browsers (Instant Action, Unity, etc.), it makes a lot of sense (and might enable a lot of junkies to play the game at work and other places they might not have been able to play).

My main question though: after a while, why would you want to “play” a game that involves no play at all? Granted you can socialize and potentially play something in the game, if someone creates a game for you to play.  I know they’re talking about 800k+ unique users and all that but, how many of those are just storekeepers/product producers? If you have an economy based on people just selling crap, at some point people are going to ask: Do I need this crap?

In a standard MMO, the answer is usually yes. Some fancy armor, extra gold to buy other stuff, etc. That’s actually tangible in a virtual sense. I need that shit. In the real world, sure I might buy some stupid picture but that’s because I have this wall I stare at all the time and I want to put something on it so I don’t have to stare at the plain stupid wall. But, there’s another funny thing related to that: if I had to choose, I’d choose food or a new game or a night out with friends over that funky picture. With a crappy economy, I usually have to make that choice.

I dunno. GDC Austin’s been renamed GDC Online to cover the vast online world (meaning virtual worlds AND MMOs and the like). Obviously, with ample (and cheap) bandwidth and the need for socialization (despite the usual stereotype of the lonely isolated gamer), online is the place to be. Whether it’s a lobby or a full-fledged world, people want to game with people in the end. Thing is, that word “game” is the key.

Think of it this way. The average gamer has a budget (whether they blocked it out in QuickBooks or just think about it in their head). They can spend $X per month on games. Despite their cost, MMOs are still getting churned out at a decent clip…some are even free to a limited extent (remember, you’re still getting suckered into those microtransactions). In the end, as time moves on, games form communities of like-minded individuals…until they get bored and find another group of like-minded individuals around the next big thing.

And, while I don’t expect a mass exodus from Second Life, I think this reorg is a sign that the people at Linden Lab see there’s no where left to go but down. Of course, they could reinvent themselves some how…or rather, they can try to steer the ship. At this point, though, I think they’ve got to be already aware that they aren’t steering any more. Much of the game relies on user-generated content/products. When those users decline, so does their content. And, as we all know, static content with no updates, expansions, etc. ends up being boring. Boring means whatever that fancy new MMO that just opened up shop down the street is offering is probably better than this (for now).

I think this part of the virtual world is really susceptible to a newcomer. Someone can plant a flag and produce a solid virtual world for people to play in that offers all the same benefits with a newer sheen and newer features. That could mean yet another reorganization in the future…one that doesn’t end until the servers are barren and empty.

g afk

So, Linden Labs decided to enter the virtual goods fray by buying two sites that hawk their wares. Time and again, virtual world and MMO publishers have avoided the potential profits from virtual goods, instead sticking to lobbing their EULA grenades around. I’ve said it time and again, what better way to control game balance AND make some money (Second Life’s aftermarket generated $360 million? Drop your virtual linen and start your grinnin’) than to offer up a venue for virtual goods commerce?

Think about it. Players are already doing it. Why not take a rake and make it “legal”? Better yet, you can even control it a bit. Don’t want epic items accumulating on a single shard or world? Fine, set a limit? Tag an item as available for certain worlds.

WoW and others have been offering up more and more character transfers (though it’s been a bumpy ride.). They charge a fee so why not let someone sell their level 60 hunter they’re bored with, charge them a larger fee if they want to transfer it to another world and take your cut. Will players gripe at first at that “service fee” you tagged to their item? Sure, but if it’s not huge (you’ve to 11 million subscribers you’re already making huge money on, don’t gouge…leave that to rogues), they’ll get used to it. Especially if you make it 100x easier to do the transaction. Selling a sword? CC clears and BAM it’s in someone’s in-game mail in hours. Gold? Even easier…it’s just a number.

Funny thing is, you might even up your PR and make your players happier.

So, to all those publishers gripping the purse strings so tight they’re losing gold left and right, take the cork out and relax. Money’s out there to be made…gold in thar virtual hills.

grieger afk