Second Life Creator Linden Lab Prepares To Test Parallel VR Universe

Xconomy San Francisco —

[Corrected 6/26/15, 10:02 am. See below.] San Francisco-based Linden Lab, the granddaddy of virtual reality companies, is celebrating the 12th birthday of its cyberworld Second Life this week with a digital fairground full of fanciful constructions, including a concert stage shaped like a birthday cake.

But Linden, founded in 1999, is also getting ready to open an alternate online universe to its first digital settlers by the end of July. Linden’s next-generation virtual community, temporarily dubbed Project Sansar, is not a mere upgrade of Second Life, which was launched back in 2003, CEO Ebbe Altberg says.

Although Second Life is still a popular online meeting place, as well as an e-commerce marketplace with a GDP greater than $500 million, Altberg says Linden Lab’s leadership team decided last year it needed to build a new world from the ground up if it wanted to succeed in the future.

Linden and its competitors are rushing to create content suited for a new wave of head-mounted viewers such as the Oculus Rift and Samsung Gear VR, which can immerse users in a 3D experience with more realistic motion, lighting, and sound than earlier virtual environments.

Those competitors include San Francisco-based startup High Fidelity, which was founded in 2013 by Linden co-founder and former CEO Philip Rosedale; Cloud Party, which was acquired by Yahoo last year; and Redwood City, CA-based startup AltspaceVR.

While Linden has been making improvements to Second Life, Altberg says it would take more than just tinkering to retrofit it for current virtual reality hardware while keeping the site up and running.

“It would be like replacing the hull on a ship while you’re crossing the ocean,” Altberg says.

The next-gen Project Sansar can already run at 75 frames per second—a speed unachievable in Second Life. Linden plans to accelerate Project Sansar to 90 frames per second to sync with specifications expected for the Oculus Rift, Altberg says.

Faster speeds not only smooth out movements on screen. They’re also important when viewers move through virtual worlds wearing 3D headsets rather than merely looking at a monitor. They can become nauseated when the display lags behind their movements, or contradicts what they’re hearing, Altberg says.

Linden plans to begin alpha testing Project Sansar toward the end of July, by inviting in handpicked, skilled creators eager to build something in the new virtual reality medium, Altberg says. These guests—who won’t be employees—will use each other’s games and other invented environments, trade feedback, and tweak their own work, he says.

Within about a year, Linden will begin inviting ordinary users to explore the ecosystem, with a more public beta testing phase around the first half of next year, Altberg says. A version 1.0 might be ready by the end of 2016.

While Linden plans to do many things differently in Project Sansar than it does in Second Life, it will also draw on its dozen years of experience operating a pioneering site in several different fields: virtual reality, user-generated content, e-commerce, and virtual currencies. In Second Life, users can buy its currency called Linden with their credit cards at an exchange rate of 250 for one dollar. They can also earn Linden as participants in the Second Life economy, and cash out their virtual currency. Altberg says users redeemed a total of $60 million in 2014.

Among the products and services for sale are makeovers for one’s avatar. Second Life’s standard-issue, free avatars all look like minor Marvel Comics characters—maybe to appeal to the male fans of digital games who flock to virtual reality sites. But users have also used Second Life for more diverse activities—to host meetings, offer college classes, teach each other languages, open fashion design houses, and set up real estate businesses. (The pirate ship with dirigible shown above is a Second Life creation.)

Linden, which is profitable, earns revenues by renting “land” where users can build their virtual homes, museums, shops, or racetracks, at the rate of for $295 per month for a plot of a little over 16 acres. Users who only want to pitch a tent or open a taco stand can rent smaller spaces from virtual real estate businesses that lease large properties and then create subdivisions, Altberg says. [An earlier version of this story miscalculated the size of a plot rented for $295 a month. We regret the error.]

Second Life will live on after Project Sansar opens its doors as a parallel universe, probably under a new name.

“It’s still very popular and very successful, so we have no plans to discontinue it,” Altberg says. Second Life now hosts about 900,000 active users a month—a bit lower than its peak of about a million years ago. As a private company, Linden Lab doesn’t disclose its revenues. It had raised a total of about $30 million in equity financing by 2006.

Linden’s employee count is now more than 213 “and we’re hiring as fast as we can,” Altberg says. Most of the new hires will … Next Page »