Sooner or later — often sooner! — a new user will know that they need money. They might have read magazine ads telling them how successful business in Second Life® is. They might have browsed through blogs and forums, catching numbers here and there, on how much money is being transacted in SL, and how some content creators and live music performers make a living here. They might even have come to a conference or two at the Beta Business Park and listened to people talking about their business experience in SL. Or they just looked up on the top of the screen where it says “L$0″ and wondered how to get more.

No matter what the reason was, usually rather early in the process of getting acquainted with Second Life, one of the very, very first questions asked is how to make money in SL (often seconded by “will you give me some L$?”). Unless, of course, you just came in for the dating

Traditionally, the usual answer you give to an intelligent new user is that it’s “as hard as to make money in the real world”, and follow that up with a comparison with making money from Web design. Some helpers just take the trouble to describe what you can create, from buildings to clothes, from scripting to animations, and patiently explain how you develop a brand in SL, make it a successful, and retire on a Caribbean island (even a virtual one!).

The casual user, however, is not interested in how to make money that way. They want to make money fast. They know they’re unskilled, so they hardly expect to become the next super-architect or boots designer in SL, but they still want money. Quickly. Painlessly. Without an effort.

At this point, most helpers just shake their heads and sigh.

Making money in SL’s remote past

A few years ago, it was far easier to “make money fast”. All you needed was a Basic account and to log in for a few minutes: you’d get L$50 every week that way. If you wanted a bit more, you could just join one of the hundreds of daily contests that were sponsored by Linden Lab, and they would give you, say, L$500 — if you won. But you could always participate on a different contest.

The economy ceased to be subsidised several years ago, and thus making money fast became far less easy. Gambling in Second Life, outlawed in August 2007 (except for the immensely popular Zyngo, that Aargle Zymurgy for mysterious reasons is still allowed to run), used to be a major way to make money — or, more likely, lose it very quickly. Unless, of course, you set up your own casino The politically-correctly named “escort service” was another way to get some money at the very beginning, and with luck, your “sponsor” would possibly pay for your initial set of clothes and an “appropriate” Animation Overrider. But besides that, making money didn’t seem to be very easy…

Enter camping. In the past, Linden Lab would pay land owners for the ability to drive traffic to their locations. The very naive concept behind this was simply that “cool places” would be popular, thus making residents happy, and this should be rewarded with a financial incentive in the form of a lower monthly tier payment. Thus, land owners quickly found out that they could set up chairs on their location that would pay any resident sitting on it a small fee per minute (or per hour) — artificially driving up their traffic, and ensuring a higher return on the monthly “incentive payments”. Camping chairs were born, and some of those were quite ingenious, like the “camping dance poles”, where attractive avatars would just sit inside a “dating parlour” and let their avatar be animated with sexy poses or dances. My favourite ones were animations cleaning building façades or lawn mowing

Linden Lab then removed the financial incentives for higher traffic. For a while, the impact of this measure was not unduly felt, since higher traffic still meant higher ranking on the internal search engine, and camping chairs were still useful for that. But then “camping bots” were invented — they would be much cheaper to maintain and guaranteed to attract an artificial crowd that could be “sitting” for any amount of time desired. Bots became the bane of Second Life, since they are so easy to setup, require almost zero maintenance, never leave their place, and naturally enough, do not require any payment. Camping chairs for human avatars became less popular.

Of course, the next predictable step by Linden Lab was to consider any measures to artificially increase traffic to a location illegal — specifically, camping bots, but also camping chairs or their more exquisite alternatives — and even go so far as to require users to flag their avatars as bots or humans. Using any of those systems became a bannable offense, and for a while, the reduction of the number of simultaneous users by 15-20% was attributed to the removal of dozens of thousands of bots grid-wide. They’re not all gone, since LL is unable to catch them all. And, since high traffic still gives an advantage on the search engine ranking, some locations continue to have variants of camping chairs for humans: in some cases, avatars actually have to stand up and walk a bit around the place to ensure that, if the land owner is reported, they can prove that their campers are not just sitting in the same place for hours and hours.

No matter how successful those techniques were (or still are), the point is that paying people to simply come to your place have become less popular. Without gambling variants, you wouldn’t be able to provide entertainment that would give L$ to unskilled people — and skill games are far less attractive than unskilled ones (for a new user). The notion of just paying people to sit on a bench and stay there disappeared. So there were no more easy ways to make money in Second Life.

The new generation of money-making schemes

In the real world, there are a lot of methods for unskilled people to make money — not much money, but at least something that is worth the time spent. Possibly the oldest of those methods comes from market analysis: it’s popular to give a small gift if you fill up a form or reply to an interview regarding a product’s perceived brand awareness. It’s just to thank you for your time. Lots of sites actually list events and things that give out free gifts or even some money in return for your time; some people spend all their (real world) time just looking for those — which can quickly turn into a full-time job! — and do little else besides searching for “free money” or “free gifts”.

But I still think that the best model is something automated… like Google AdSense. Google turned the common user into a billboard for advertising services — not a novel idea, but they definitely do it massively. The idea is simple: you’re already driving traffic to your website. Ad sponsors want that traffic. Google acts as the middleman putting both in touch and charges a percentage (how much, we don’t know; but it definitely accounts for billions of US$ in annual income for Google!). Anyone can set up a website in minutes and place a Google Ad on it, and immediately start making a few cents. Work harder to get more traffic, and Google pays you more. It’s simple to setup, simple to understand — although very hard to make a living of it (my other blog barely pays for the annual hosting expenses with the income I get from the ads!).

The whole idea is, however, easy to understand, and a few variations are naturally possible. Market analysis, for instance, can send you a gift if you fill up an online form — a gift which could be, say, a Google AdSense voucher, or a voucher for Amazon.com or eBay. In the not-so-distant past, people were paid to click on links, just to drive traffic to websites. Charities very often have links where you can click, and they’ll send some money to feed people all over the world, for example. The notion that a micropayment is more than adequate for people to do very simple tasks online is quite popular, and many variations exist.

Needless to say, clever Second Life entrepreneurs have figured that they could do the same. Billboards in Second Life never catched on, except perhaps on the mainland, since hiring spots to place ads was too expensive for the little traffic they guaranteed (if you had a spot already with a lot of traffic, why bother with placing a board there?) Metrics were also inadequately supplied. The same problem exists with billboards in real life, too: if you have a board on a location that is “seen by 100,000 people every day”, how many of those did actually buy your product? Unless you have a way to measure the return, this is usually dealt with heuristics — and some follow-up questionnaires.

Second Life, however, allows for something much cleverer: interactive billboards. A sign on the board can invite the user to click on it, and when the avatar does so, they could typically receive a landmark and/or a notecard, but also a tiny monetary incentive — say, L$1. The land owner setting up the billboard might get another L$1 (think of it as “rent”). And the advertiser would pay L$3/click.

Several variations on the theme exist. SLBiz2Life is a typical example of an operator providing those kinds of services, one of them called “Ad-Fusion Network” which is just a system like the one described.

Clicking on ads inside SL might be the most basic way of getting some awareness, but there are more alternatives. Shop owners have long since created groups to promote their products: join the group, and you get some free items once in a while; Fashion Consolidated offers a “meta-group” where thousands of content creators routinely make their announcements and send their freebies to dozens of thousands of eager residents; kiosks on the designers’ shops allow people to automatically register to the group. Subscribe-o-Matic is one of the most popular automated systems to do the same thing that doesn’t even require people to join any SL group; Jacek Antonelli’s Deliverator is a similar tool. An alternative to attracting people to your shop is just to set up a device that gives free gifts: Lucky Chairs are a popular method of doing so. The disadvantage of those tools is that you have to know beforehand where to go to get some free items (or free L$ to spend on a shop).

More innovative solutions exist. For instance, you can get paid to list a shop on your picks list. Variations, like paying you for joining a group, or list an URL or something on your profile, also exist. These days, as it’s easy to retrieve information from within SL, almost anything on your profile can be scanned and validated to see if you’re still being a good, walking ad — and if so, some L$ love will be sent your way!

What about finding new places to visit, where content merchants with their ready vendors anxiously await new customers? The above methods most rely on people finding locations first, and then joining a group (or tweaking their profiles) to get some L$ or freebies. ConeNet from Bletaverse works from the reverse approach. You can think of it as an evolutionary approach to the old camping chairs. Instead of a chair, however, you place a special Traffic Cone on your shop. You pay a certain amount to it. Now everybody that finds a Cone somewhere on the grid can click to teleport to a random location; if they arrive at yours, you’ll get debited L$2 which will go to the visitor, and an additional L$2 to ConeNet. Visitors to your location have to stay in the same area for 11 minutes to get some payment — this will obviously increase traffic, so even if they don’t buy anything, you’ll at least get a bit more traffic for your rankings. The system is quite democratic: it doesn’t matter if you invest a lot or little, you’ll still get visitors randomly allocated to your place (I’ve tried it out on my always-empty and never-visited shop in Io and got 20 or so visits in 24 hours). You can also control your campaign very carefully: no money will be debited from your account beyond what you’ve initially set up. Some cleverly simple anti-bot measures are in place to prevent bots to use the system and deplete your L$ account. An alternative, which is HUD-based and gives higher payouts (but also requires advertisers to spend more), is Pay4Visit from Earn2Life.

More complex systems exist. Knowing that people have little patience to travel around in search for new items — specially free or very cheap ones — companies like Robbie Kiama’s metaLife offer a full range of devices to facilitate capturing visitors to your location or sell them items. These involve HUDs and in-world kiosks; they add social networking and a way for people to tell friends what interesting things they found. Of course, reading Fabulously Free in Second Life is an alternative

If all else fails, well, there is no other option but to get a job. SL Job Finder from Indusgeeks is probably the longest-running job advertisement website for Second Life; another option would be the jobs page on SL profiles. However, don’t expect much from these sites: word-of-mouth is still the best way to find reputable, skilled workers in Second Life.

Last but not least, you can always search for the myriad sites out there offering L$ payment services in exchange for some kind of advertising or marketing campaign.

In conclusion: yes, you can make money in L$ without being skilled. All it takes is some time  to watch some ads.

When I started blogging about Second Life®, my original purpose was quite naive: create a place where starting residents (newbies!) could find some information about Second Life. It was supposed to be a sort of “guide” — but a guide written by someone who was actually also starting her first steps in Second Life! Each time I figured something out, I would immediately blog about it (well, I had far more free time for blogging, that’s the simple truth!).

Soon, however, I found out that there were far too many “beginners’ guides” out there (my personal blog still gets lots of queries for “tutorials” or “free scripts” or “clothing templates!”), and I should just turn to something else: discussing the implications of living and working in a virtual environment.

That did, indeed, capture my attention for the past five years.

Starting in 2006, we saw the arrival of a new generation of business in Second Life. It was not only the people creating content in SL and selling it for a few L$. It was not just land barons. And, to a degree, it was not only pseudonymous avatars doing transactions in SL. A new type of business — the Metaverse Development Companies (MDC) — had arrived on the Grid, and were here to stay. They are real companies, with physical locations in the real world, with employees getting paid through bank transfers, and paying taxes like any other company. Their clients were not other residents of Second Life — but other companies, as well as universities, institutions, or the Government. For all purposes, they were conducting business transactions outside of the Second Life economy, and thus it’s always hard to estimate how big that market is.

Surprising at first, most residents were baffled at how these companies could survive at all. Labour in Second Life was cheap; for as little as L$500/hour, you could hire any reasonably good content creator, and most would work for free anyway. How would real companies manage to survive with all that low-cost competition?

The answer actually baffled our original team (just Eggy Lippmann, Moon Adamant and myself) in mid-2006. Residents come and go; content creators appear one month or one year to disappear forever in the next week, either because they got bored with Second Life, or stopped outputting content. For a large group of content creators, Second Life was entertainment — something they did for fun, and this meant that their “real job” (in the sense of their job outside Second Life) always had priority. They quickly got tired from answering emails or IMs from their angry customers and just deleted their avatar and started from scratch with another one. The notion that work in Second Life actually entailed some responsibility was completely out of their minds. Doing business with them was a nightmare.

Of course not all thought like that. But, again, surprisingly, the number of reliable content creators in Second Life in 2006, the kind that corporations and institutions are after to establish business deals, was quite small. Beta Technologies was created to fill that niche: when the real business meets the virtual world, it means responsibility, liability, quality processes, and the ability to meet a deadline with professionally designed content. The many freelancers in Second Life were simply unable to provide all of that.

On the reverse side of the mirror, many individuals also were quite reluctant to engage in “serious” business with real life corporations. A few stories popped up in the past about some less reputable organisations who simply took all the content and refused to pay for it, alleging all sorts of reasons, but the most usual one was simply being able to afford not to pay a pseudonymous user. What could a resident do? Hire a lawyer to fight against the megacorps? It was highly unlikely…

Today, fortunately, the content development business is quite mature. Linden Lab lists over 300 developers on their Solution Provider Directory, and these are just the ones that bothered to get listed. Over 30 are Gold Solution Providers, like Beta Technologies, which has been through a long, detailed, and thorough process of validation, where Linden Lab has taken some pains to interview clients, view the overall work delivered, and confirm credentials. This list doesn’t include a lot of reputable organisations, like universities and not-for-profits, that regularly output content in Second Life for other real life organisations — they’re also “metaverse developers”, just working under different assumptions (i.e. they don’t work for a profit; but they most definitely wish to cover their costs!).

While I was still happily walking around the grid in search of cool things to see, to do, or cool people to meet, part of my daily work was spent in the more administrative aspects of running a new company. I’m no stranger to that, of course, but working in Second Life was really way more challenging, since so many things we take for granted are so different. Perhaps the thing that mostly affected me was to have to deal with this idea that “people in Second Life are playing”. I used to tell my colleagues and friends that I had to go back home, because I would be meeting a client in Second Life. At the beginning I was merely laughed at; later I guess that some of my friends just thought I was plainly insane. Right now, I’m a bit more careful — I just tell them that I have a teleconference to attend with clients from overseas, and so I have to get back to my computer where I have all the required setup. This is far more acceptable in the corporate world: we’re used to teleconferences, and most of them do not happen in the office any longer, specially if you work across 12 different timezones, as I did for a while

Still, the reverse is also true. These days, except for a few scattered exceptions, I tend to login to Second Life only for business-related work. I’m aware that a lot of residents who work for other metaverse development companies have simply created a different alt when they want to join SL for fun. I never managed to do that, and as time goes by, it makes less and less sense to me. On the other hand, in the real world, I can easily separate between “work” and “fun”. If I’m at the office, people usually don’t ask me out to go to a dance club in the middle of the afternoon. Even though a lot of people still believe that MSN is just good for setting up dates, since 1997 I’ve been using instant messaging tools just to do business — but at least I can turn it off if I don’t want any interruptions (like I switch off my mobile phone during meetings!).

In Second Life, the separation is not so clear. I might be in the middle of a meeting, but a newbie I met the day before asks me for some tips and help in IM. A friend, living on a different time zone, sends me a teleport request to join a party — because they assume that if I’m in Second Life, I’m free and having fun (or bored at work — yes, there are so many lucky people who have time to be bored at work and log in to SL for some fun!). For them, declining politely the IM or the offer to join them at a club, is even more weirder than explaining to my colleagues, friends, and family that I have to attend a “teleconference”. They can’t understand how someone possibly has a job that makes them stay in Second Life and not have fun! (Well, actually, most of my work in SL is fun, although not all of it…)

And it’s always hard for me to explain to someone that just dropped inside a corporate meeting that we’re not really socialising and chatting about trivia, but actually trying to get some work done. Most of them don’t believe us, or just think we’re some strange roleplaying types that get their kicks by pretending they’re business managers

All this is actually quite fun if seen from the right perspective, and part of being alive in the 21st century — very likely, the first century in history where the fine dividing line between “work” and “play” is so narrow as to become invisible. So, naturally, this whole aspect of Second Life — Second Life as the tool that will finally shatter the barrier between fun and work — caught my attention as a blogger, and I wrote a lot about it.

Although it was quite unexpected or unplanned for, the articles about this strange relationship between “work” and “pleasure” caught the attention of many of my readers. I can’t possibly claim any credit for being the “first” in writing about it — after all, almost all my competitors in the MDC business wrote about it very early, as well as a lot of media journalists, specially after Anshe Chung became famous for making her first US$ million from work done in Second Life.

But it certainly was something that I quickly found out to be even more interesting than writing tutorials for newbies (please, no disrespect intended; I still teleport to the Help Islands and spend some hours there, just to have a feeling on the type of newbies that we’re getting, and what are their current major issues with Second Life). In a sense, I started to write for “business newbies” — people that had heard about Second Life, wanted to engage in business here, but were completely lost in the process. They needed something to hold unto that gave them reassurance that things in Second Life might be “weird”, but, like doing business on a country you never visited before, the weirdness goes away as soon as you start getting familiar with it. That was my purpose: making people familiar with Second Life, and understand how it is valuable as a business tool.

Well, it’s now time to split my blog in two

On my original blog, I will continue to explore one aspect that always fascinated me about Second Life. It was, for the first time, a technological tool that fundamentally allowed me to think about my self. I’m familiar with several other approaches, of course — from the sciences of the mind. I hardly expected to find a tool that would allow me to explore the self using, well, a crude thing like a computer. But this is a vast field — and it encompasses what I find cool and exciting in Second Life, as well as more trivial things like SL fashion, or how art is slowly blossoming inside this medium and coming up with novel ideas, or, well, how we view and explore relationships inside a virtual world. There is always so much to talk about this whole area that I could spend a lifetime writing about it and would never see beyond the tip of the iceberg.

On this blog for Beta Technologies I will address the issues that mostly affect business in Second Life: how the technology and the in-world economy work, and how both influence the use of Second Life as a business platform. Oh, I’m sure I’ll be digressing a lot — that’s the fun bit about writing about Second Life I rarely have any idea where things are going to lead, and I’m quite sure that the whole entertaining aspect of it (and writing about it!) is just to follow the process and see where it ends.

After all, none of us at Beta Technologies would ever imagine that we’d be here, today, doing what we do for a living…