Africa in Virtual Worlds

…Journal of our Experiences with Social Media and Virtual Worlds to date…

Archive for the tag “Linden Lab”

Nine Months Later…

It has been almost nine months since the last post. Almost like giving birth to something new – we have been thinking about virtual worlds a lot here at Uthango Social Investments. Much changed at Linden Lab during this time, like Philip Rosedale who returned as CEO and in Second Life, a new viewer was introduced and is still enduring its growing pains.  Some  flaws remained exactly the same, like live music/entertainment still not getting the prominent place it deserves, and emerging markets still being overlooked in terms of experimentation with virtual worlds.

Similarly, change and consistency are also true for our project on the platform – and yes, we still DO think of it as a platform and not a social network, although the debate lingers. Virtual Africa remains in Second Life and gets about 3000 visits a month, but by firm resolution of Directors, we reduced our footprint and decided to pour less energy into the initiative, and focus our limited resources on building capacity of organisations that work directly in communities in South Africa. During this process we engaged several civil society organisations on their needs to be effective and  confirmed our belief that advocacy in terms of community radio, mobile and social media tied to direct beneficiaries is a priority – as it should be.

The latest good news shared among long-term SL fans in the metaverse, is that Linden Lab is returning to basics to fix what is not working, and introduced Mesh with great potential for creative content-creators.  It is certainly worth exploring. Let us stick to the disturbing news for now: No more special discounts to educational institutions and non-profits from January 2011 (which is really bad news for any organisation from this side of the world that was planning to join). The latter was promptly announced by Nelson Linden on the 4th of October, and the comments are even more telling than the ‘ugly truth’ itself:

Announcement by Linden Lab early October 2010

 

We have been asked in private by quite a few long-time users of Second Life how the  LL decision will affect our project. So here is the deal: Uthango made a decision to invest less in Second Life after it became clear to us that Linden Lab’s business model does not have sufficient room for mutual benefit in terms of applying virtual worlds for/in Africa. Apart from Philip Rosedale’s visit to Virtual Africa in 2007 and declaring on two occasions that there is potential in virtual worlds to provide income to grass roots entrepreneurs in Africa!, it was clear to us in mid-2009 that Linden Lab’s strategic team did not debate – nor ‘google’ – how “doing good is good for business” – because if they did, they would have:

  1. had a more solid Corporate Social Responsibility’ strategy in place by now, to ensure that their business decision-making is based on shared ethical values and benefit beyond profit to the state, country or the world (even) in which they position their service;
  2. made a bigger effort to work in partnership with educational institutions and non-profits on various fronts, least of it being research into the application of virtual technologies to improve quality of life;
  3. understood that the reputation of Second Life has been held in tact by an active educational community that have implemented extraordinary initiatives and promoted it in their respective reputable networks; and
  4. implemented a more structured client support programme aimed to verify qualifying non-profits and institutions worldwide.

Linden Lab CEO, Philip Rosedale was quoted in the CSR Digest, “’You can argue with a mentor, but you can’t argue with the crowd… When every third person says you’re too scattered, it’s the truth.’” The context here was an employee peer-assessment, but surely the same principle holds true for other parts of the business. Isn’t it ironic that it seems that truly innovative, and forward-thinking business people and their enterprises are increasingly seeing the value of social investment, of doing business or being in business with societal change-makers (non-profits, librarians, educators and social entrepreneurs) and yet, Linden Lab takes a step backwards in October and alienates the very groups that the company courted before when hype was high and a good reputation was needed. Or should we interpret the innovative edge of Linden Lab merely in terms of  technology and not broader business practice? In a recent post, Gwen Llwellyn points out that Linden Lab is merely turning “residential (with) OpenSim embracing education and business”. She paints it as an opportunity of sorts and this is the motivation she suggests – when it comes to Linden Lab’s strategy:

I know that Philip has repeatedly said that Linden Lab would still support business and educators on Second Life. Nevertheless, I would say that actions speak louder than words…I’m not blaming Linden Lab. Business and education where good for PR — back in 2006/7. But, in truth, LL is not really a non-profit foundation. After all, they make money from leasing server space for hosting 3D content. The over 1400 organisations in Second Life are not exceptionally good customers: most have, at most (and on average), just one sim. They contribute little (if at all) to the SL economy.

Agreed. Linden Lab is not a non-profit and should provide value for money to shareholders. Period. However, the world has changed in the economic downturn, and the way we are doing business is fundamentally shifting. Although I am also not blaming Linden Lab, business and education is not only ‘good for PR’ – but it is good for business itself, and Linden Lab is making a judgement call that will shape its business for the future.

I also think Gwyn’s statement that educational institutions or non-profits do not contribute much to the SL economy is a bit harsh.  Ask “How does education affect the economy?” in Answers.com and it spits out: “Education directly affects the level of human capital (skill and knowledge we acquire), which is an input in economic production. Human capital increases economic growth by decreasing the costs of production and therefore increasing cost efficiency“.

The role played by educators and non-profits to enable  users to use the platform productively may very well be overlooked by Linden Lab  in their calculation of land fees. Intangible value added by (unpaid-for) services of training avatars, creating communities and sharing content-creation skills is not being brought into the equation.  Linden Lab seems to have blinkers on in terms of trends internationally – where relationships with community builders are treasured like fine gold in a very competitive business environment. Ironically, a few days apart from the announcement, Voigt Linden states as a high-level goal: “(to) leverage industry best practices, and our own hard-earned lessons, to create a comprehensive customer service offering”.  In this case, industry best practice would suggest to build on those elements that are successful when wanting to grow and consolidate a business model – which is (certainly) the educational component of Second Life. After all, at a recent Virtual Worlds Education Roundtable on the 9th of September Ignatius Onomatopoeia (SL) stated:

  • 800 educational institutions, 550-600 of them colleges or universities, currently in SL.
  • of all land owned by organizations and not indviduals, 50% is owned by education, a figure that does not include museums or libraries. No one comes close to education, with non profits coming next.
  • Edu growth more than 10% since last year.

Yes, the reality is that only about 10% of the avatars in Second Life is associated with education.  If numbers are counted, one could be deceived to think that it would not make such difference to lose the support of the sector, and a shift to ‘residential’ and social users is a good call. In our opinion, the educators and non-profit leaders (together with the live performers) make up the greater percentage of community builders – the influencers, and the glue that holds networks together. It is simply short-sighted to sacrifice high-level widespread public relations for narrow bottom-line profits. In the long-run the lack of ‘doing good’ may hurt the business of Linden Lab as they wave many early adopters, community builders and innovators farewell.

All of us yearn to see that Linden Lab has a long-term view and vision for Second Life, one that is inclusive and takes more than its own agenda into consideration. At the SLCC2010 we heard some tones of this, but action will speak loudly to  rebuild our confidence in the leadership at Linden Lab. If not, the alternative is too obvious: It is about short-term profits and creating value for a few shareholders and investors (which is not entirely bad!). Interestingly, Linden Lab offered an explanation, which is captured and discussed in the blog of Tateru Nino and their reasoning is apparently unrelated to profit (not entirely believable) and based on the principle of ‘fairness’:

Ultimately, we made the business decision that as we focus on improving Second Life for all users, we will no longer provide the level of special treatment previously offered to educators and nonprofits, which includes ending the 50% discount these organizations have received.

It is a strange and fascinating logic, suggesting that Second Life will improve because it is more fair  (e.g. no special treatment). For the record, one thing we DO know is that Linden Lab never offered our non-profit special treatment in any form. In fact, we have been disadvantaged in quite few ways, with the currency exchange the least of our challenges.  In terms of the real reason behind the decision, we can only speculate, that Linden Lab’s inability or unwillingness to verify the status of those that qualify for a discount, made the decision easier to get rid of some that misuse the  flawed system: Since we registered for Second Life in 2007, we have always recognised how vulnerable the platform was for exploitation related to a non-profit or educational status. After all, our first telephone conversation with a Linden Lab manager was about our desire to verify our status and align our auditing processes with record-keeping systems.  (A lot of good work was done in terms of a database of nonprofits by the Non Profit Commons). We are a registered Non-Profit Company (NPC) in terms of the South African Companies Act of 2007, amended 2010 with internationally recognised auditors, lawyers and paying VAT at the same rate as any other company.  Yet, we were not asked our registration number on purchasing land at a discount and we offered it in an unsolicited letter to Linden Lab to make a case for international verification based on our own need for compliance. (And again, it is not Linden Lab’s responsibility to ensure compliance, but if discounts are offered to a sector, it makes good business sense to get checks and balances in place – and certainly before pulling the plug and losing the baby with the bathwater).

Important! It is not all doom and gloom for non-profits – in fact, Linden Lab announced a ‘lock-in’ on current prices for tier if these entities show commitment over a long period in the future. This has been received positively by the community after an initial outcry. We are also relieved and will take it into consideration when we decide next steps. Entries by BetterVerse and bloggers such as Silver Telling reflect some of the sentiments of the community when Linden Lab responded cautiously to the non-profits. However, for some, the trust damage has been done, and they are cutting their losses and planning exit strategies….

Much is happening in the virtual worlds’ space and innovative platforms are seeing the light every year. One thing is sure: Linden Lab needs a savvy strategy and some businesses and organisations will exit. The question is whether the company is building doors, pushing clients through them, or standing on the outside themselves already…. with Microsoft (rumour?) putting in new carpets…

SongBirdClone’s tune on (not-so-open) spaces for NGOs in Second Life (TM)…

In Second Life (TM) we have the opportunity to liaise with many organizations – this is, after all, WHY we are also in virtual worlds as a fellow nonprofit organization. It is widely acknowledged that one of the greatest value of virtual worlds is in working together. More about this in a follow-up post…

And so I have met SongBirdClone Writer quite a few months ago with this short introduction:

  • [11:25]  Alanagh Recreant: Hi there, please let me introduce myself quickly: I am… the Director of a RL NGO in South Africa. If possible I would love to talk to you when you have a minute – this relate to a conversation I had about charities with Linden Lab…

SongBirdClone is a well-respected real world “conservationist of endangered species and globally imperiled habitats. (She) lives in the USA and is the Founder and Executive Director of  The Habitat Trust for Wildlife and Spirit of the Sage Council”.

A few months later, and last week my friend SongBird appeals to us and copies a letter to CEO of Linden Lab on the latest Opensim issue, and I hear the frustration in her ‘tune’ so clearly:

  • “[15:23]  SongbirdClone Writer: ….. We are very distressed over this LL proposal to raise the tiers on Open Space sim by 333% for nonprofits. Current cost is $37.50 per month and LL is proposing $125. a month.  This is just outrageous and impossible for small nonprofits!!  Please do not raise the costs for nonprofits that have less than 4 sims PLEASE.   I really need to know ASAP what is going to happen for us small nonprofits?   We have paid in advance and I believe that was a contractual agreement?    Besides the excessive increase in costs, how do you expect small nonprofit to pay 6 mos – 1 year in advance at a 333% cost increase?   Is LL trying to get rid of charities in SL??” [15:23]  Second Life: User not online – message will be stored and delivered later”.

Well, UTHANGO just purchased two openspace islands adjacent to Virtual Africa to experiment one step further with sustainable practices for nonprofits in Second Life. We have set out little African safari campsites and prepared ourselves for a break-even to cover the tier fees with limited, wide-spread, low-prim rental spaces: A true virtual wildlife experience!  BUT!! We got the letter a month later (AFTER being pressed to pay 6 months in advance for these sims!) and even BEFORE these new openspace sims opened:  The Linden Lab Conceige Team (always courteous mind you) simply reminded us a few days ago: “Rather than being employed as open areas like ocean with little or no content and traffic, the majority are being rented out to residents looking for a place to live…”  Now, I understand Africa has some water and many open planes – but even for us, it is a tall order to ask a non-profit to put an entire sim to such unsustainable use as NOT to rent it out to residents (really community members) that would like to contribute from the sky campsites (six small ones) to the maintenance of the project. I must be missing some reasoning here…

For now, I shall just say that we will continue to seek sustainable ways to use virtual worlds in/for Africa. This last step makes it a bit more impossible to apply Second Life’s benefits to Bottom-of-the-Pyramid projects – or even, to achieve our dream to revamp Robben Island for intercultural dialogue and exhibition of African best practice projects. But! Yes, we can!  We appeal that the voice of Songwriter Writer and other NGOs and educational institutions be heard loud and clear. There is not ‘abuse’ by these institutions and organisations (I am almost sure) when they seek to recuperate costs. This is important in non-profit work to avoid the ‘black pit of spending without offering value worth paying for (call it social enterprise if you will). BOP principles ask that we cut the margins on profit and achieve mass market absorption – or maybe… this is what being avoided by Linden Lab? Are we being downscaled?  It will be an opportunity lost… This is a time for courage – the type of bold vision of Philip Rosedale and our own co-founder, Erna Sittig about the potential of virtual economies in developing worlds – for generating income. The same regulatory enablers that are necessary for doing business in Africa, are often true for doing business in Second Life – and we sincerely hope that Linden Lab is able to create such enterprising environment by allowing enterprise that are market driven.

“….Some nonprofits will keep Open Space sims and some will embrace the upgrade option.   Raising nonprofit Open Space costs to $75.00 is still a 100% increase.  However, a 333% increase is just plain wrong and greedy.  It’s just too much of a shock and strain on nonprofits”.

We will paste our own stance on this matter within a few days… but for now, we sing to SongBirdClone’s tune in solidarity with her organisation’s plight….

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