Coffee & Power is what Rosedale calls a "meta-company," a framework for doing business with no managers or middlemen, all arranged through a website, an iPhone app and the workclub. The site, the app and the first workclub on Market Street in San Francisco all go live today after a rapidly developed beta period starting this summer. Workers of the world, take notice: this San Francisco startup wants to make each of us the boss.

Coffee & Power users perform "missions" for each other ranging from software development to graphic design to chauffeur service to making zombie costumes. They offer a virtual currency called C$ - backed by US$ - as compensation. In the beta period, Coffee & Power users have exchanged over $10,000 in hundreds of missions.

Thus far, Coffee & Power might sound like existing mini-job markets like Zaarly or TaskRabbit. But Rosedale says those services are all about the jobs themselves. Coffee & Power is about the people first and foremost. While the other services just use dollars, Coffee & Power's virtual currency becomes more about giving people credit than merely compensating them. The site ranks participants by missions completed and ratings of trust, letting them build up reputations on a network of creative, well-connected people.

Virtual Currency, Real Work

Rosedale and his LoveMachine co-founders, Ryan Downe and Fred Heiberger, know how these kinds of incentives work. Both the medium of exchange - a virtual currency - and the social dynamics of neighbors helping each other out were tested on Second Life.

Second Life is a virtual Wild West with an almost entirely unregulated economy. It's a more extreme environment than the streets of San Francisco, where Coffee & Power has been beta tested. By this year's measurements, SL also brings in about $100 million a year in revenue, and that's for entirely virtual goods and services. Coffee & Power is the tangible version of that economy, except the costly work of building the city is already done.

Second Life, by contrast, started as a vast, flat, empty plane. Rosedale launched Second Life in 2003, and users had to create all the content themselves. "I think the forces that gave it traction in the beginning was the feeling of freedom and pioneering," Rosedale says. "The early users felt the power and freedom of being asked (and expected/required) to build the whole world themselves."

Coffee & Power users won't have to build a whole world, but they will have to invent new ways of working in the existing one. The old vision of work is static, stable, routine, repetitive. Coffee & Power workers might have different jobs every day. But the key difference is that they work for each other, not for a boss. Rosedale says that same spirit inspired the founding members of Second Life.

At first, the virtual currency in Second Life - Linden Dollars (L$) - was not connected to real money. "The only way to earn dollars was from someone else paying you something," Rosedale says, "so SL was very much a meritocracy, as you needed to do amazing stuff within the community to have large visible wealth."

But then third-party currency exchanges started popping up, L$ found a market price, and Rosedale says that "by late 2005, people really thought of the L$ as being its own real/stable currency." Eventually, the work created in Second Life gained press attention, and it was off to the races.

Rosedale says there's something "sticky" about virtual currencies, even when they're backed by real dollars. It's an investment in the community that uses the currency, which encourages holders to reinvest it rather than cashing out. In terms of Coffee & Power - as well as Second Life - that means members investing in each other.

Working For Each Other

Anne Sullivan, A.K.A. Miss Minty, a trusted Coffee & Power beta user, is driven by the freedom and parity among workers as much as the monetary rewards. When Rosedale recently asked members to describe Coffee & Power in one sentence, Sullivan came up with this slogan: "Coffee & Power: Work for each other - not The Man."

She's a freelance stylist and costumer, and she accomplished what the Coffee & Power blog calls "the best Coffee & Power mission of all time:" the zombie costume mission.

"I usually just work through referrals," she says. "However, I did see a post on Coffee & Power asking, 'I want my old suit turned into a zombie costume.'"

The mission had been posted by Catamount Ventures partner James Joaquin. This task was a natural fit for Sullivan's talents. "When I went to pick it up," she says, "he was over the moon." He told her he had a big party to go to, but he had no idea how to get in touch with a professional costume designer.

Coffee & Power made an ideal venue for that. Thanks to the system of recommendations and account validations it uses, Miss Minty and Jamesj were able to start working together with a pre-established level of trust. Here is a slideshow of the resulting zombie costume:

Cutting Out The Middle Man

As a professional costume designer, it isn't surprising that she did an awesome job on the zombie costume. But for Sullivan, the Coffee & Power economic model is essential to the work itself.

She says the name "Coffee & Power" instantly reminded her of a book with the same name about the politically turbulent 1980s in Central America. The elite and the working people in El Salvador, Costa Rica and Nicaragua during that time had to strike difficult balances and make compromises in order for those societies to make it through the decade intact.

"I think that is something a lot of people have felt is missing in the workplace as of late," Sullivan says, citing the growth of the Occupy movement as evidence that the need for such compromises is now felt worldwide. "Big business has lost its humanity."

Sullivan sees Coffee & Power as a working model for how work in the 21st century could be redefined. "If you let people work amongst themselves, a mutual respect will arise." It's not a market based on scarcity. It's as abundant with potential as its participants are, and it lets them decide what their work is worth.

It's also one that suits the remote, largely virtual and independent nature of the changing 21st-century workplace. On Coffee & Power, workers don't have to be just one thing; they can use their full range of skills for whatever work their compatriots want done. "It's not that we have to to different work," Sullian says, "but maybe we have to do it for different people."

I Want And I Will

Coffee & Power users can post and browse missions in two forms: wills and wants. Requests for a mission take the form, "I want _____," and volunteered missions are phrased as "I will _____." Members can browse for work or services by location as well as category.

I pointed out to Rosedale that these two verbs would make an excellent fit for Facebook's Open Graph, and a Facebook app would be a great way to spread the word. He thought that was interesting, but it wasn't where his head was at. Rosedale is thinking about a marketing strategy inspired by a value system that matters much more to both of us than Facebook: Burning Man.

The principles of Burning Man are an antidote to the alienating effects of the social Web and the corporate values that underlie them. That's why so many of the Web's radical thinkers attend. The first Google doodle in 1998 was the team's Burning Man away message. It's no coincidence that Second Life was inspired by Burning Man as well.

Burning Man's principle of gifting is one of the main ways its participants break the ice and establish trust and immediacy with one another. That's the way Rosedale wants to spread Coffee & Power.

Any mission can be gifted to a prospective member, who would be introduced to Coffee & Power by redeeming it. This is an invitation to the service vastly more meaningful than any Twitter mention or beta invite. After a gift mission is accomplished, Rosedale hopes, new users will trust that this system works.

The Value of Transparency

Rosedale and the Coffee & Power team work hard to maintain that trust. Their commitment to the economic model of Coffee & Power - and the openness and transparency it entails - goes right to the core of the way the project was built.

Prior to building Coffee & Power, the LoveMachine team built worklist.net, a marketplace specifically for building software using the same job exchange model that Coffee & Power has. In fact, Coffee & Power was and is developed using Worklist, and that means it's totally transparent. You can view the entire C&P development process on Worklist including the budget.

Developers will love Worklist as a way of building out software projects. We'll save the details for a separate post on ReadWriteHack. For now, suffice it to say that Coffee & Power is a democratic place. The builders are constantly seeking input from the participants, who are also, in a sense, builders. On the Coffee & Power homepage, the public chat widget is constantly buzzing with back-and-forth between users and the team.

A New Way of Working

Something's got to give. People are camped in cities around the world demanding a new way of working and doing business. The Web has supported the current wave of social movements, serving as a citizen medium when official outlets won't suffice. But Web companies themselves chug merrily along, monetizing the status quo.

Tech companies - and certainly tech writers - like to use the word "revolution" to describe the really big changes. Is that justified? Isn't it a bit boy-who-cried-wolf to call responsive Web design or an AI phone secretary "revolutionary?" How would we know a real Web revolution if we saw one? For starters, it would probably have to move off the Web and into the real world. Coffee & Power is taking values learned in a virtual world and using them to change the workplace. That sounds like a promising start.

Stay tuned. We'll check back in with Coffee & Power after it has some time to grow and tell you what its founders and members have learned and accomplished in the meantime.

Coffee & Power photo credits: MissMintySF and Coffee & Power

Burning Man photo credit: Josh Adler

Do you think Coffee & Power can change the way we work? Share your thoughts in the comments.

But this isn't just another nine-digit number in the sea of Web business news. Linden Lab, the parent company of Second Life, simply charges fees on financial transactions. Its revenue comes from an entirely user-generated economy built on real estate, virtual goods and services. Yes, there's also a sex industry.

The world uses a currency called Linden dollars, currently trading at about L$ 241.5 / US$ 1.00, and Linden Lab picks up a $0.30 transaction fee when users purchase currency. The company also gets a 5% commission on virtual goods sales on the Second Life Marketplace, and the remaining 95% goes to the user who created the object. Users also pay the company to rent virtual land, representing real-world server space, which can then be developed and bought and sold between users at will. Linden Lab is really merely a bank, providing capital as well as bandwidth, but the health of the Second Life economy is all due to the creativity and effort of its users.

Second Life is a Big Place

As of Q1 2011, the world was around 2,060 square kilometers in size, which would make it the largest city in the continental United States. Users logged 104 million hours in-world last quarter. The average monthly repeat logins, the most meaningful measure of the number of people in Second Life, was about 794,000. It's free to use Second Life, and there are plenty of free clothes and avatar shapes and other goods available. All this economic activity is based on people voluntarily paying for a more immersive experience.

Second Life has been around since 2003, and its usage statistics seem to be more or less stable, neither gaining nor losing significant numbers of users. But the virtual world has reported consistently strong economic growth, and the official numbers are corroborated by independent reports.

Linden Lab hired Rod Humble, a former executive at Electronic Arts, as its CEO late last year, replacing interim CEO and founder Philip Rosedale. The company is currently focusing its development efforts on user experience, providing better and more intuitive interfaces. If the virtual world's economy keeps growing like this, Second Life doesn't have to constantly attract new users into the fold; it can stay focused on making the experience more fulfilling for existing residents.

Second Life is far from the only 3-D virtual world out there (here's a good comparative list), but no other has such spatial or economic magnitude.

But is the Second Life Economy Sustainable?

Update 4:15 p.m.: Wagner James Au, creator of prominent Second Life blog New World Notes, questions whether Second Life can sustain its economic miracle. He cites the $75 million revenue figure, which has been stated in Linden Lab press releases, and he builds a case by breaking down the most important kinds of economic activity in-world. He estimates that the share that falls on the head of each private estate owner is $11,000 per year, which is a hefty cost by any measure.

Au says there are "all kinds of reasons" estate owners wouldn't want to pay that cost forever, and it really doesn't take much to imagine why $11,000 per year in overhead would be a bit steep for a resident of a virtual world. Most importantly, he says, "It's highly unlikely these departing landowners can be replaced." His solution is that Second Life must be made friendlier for mass adoption, and he points to some efforts by Linden Lab to move the service in that direction.

There have been a number of startups take aim at Craiglist as of late. That's no surprise, really. The UI is wretched, there's no social sharing component, and there's no mobile Website and no mobile app. There's definitely room for disruption here, right?

That concept has had a trial run, of sorts, within Rosedale's other startup project LoveMachine as a way for developers to bid on tasks that need to be done. And CoffeeandPower sounds somewhat similar to the real-time service offered by Zaarly, which also opened to the public today.

There are a couple of key differences however.

First, CoffeeandPower utilizes a virtual currency. Users who sign up and give their cellphone numbers so they can receive SMS updates are automatically seeded with C$20 to get started. C$ is exchanged when goods are bought and sold. More can be purchased (at an exchange rate of US$0.75 for C$1) and users will be able to "cash out" as well. As many of the transactions on the site might be quite small, the virtual currency will help minimize transaction fees for every exchange. In other words, you can earn from C$ and then buy things on from other users without any fees.

Second, CoffeeandPower really emphasizes the community around this marketplace. That's not a surprise when you think of Philip Rosedale's work in creating the virtual world Second Life and its online community and economy. Users will be able to chat with each other, both in a public timeline and in private messaging and video chat.

Rosedale stresses the importance of creating a "highly connected early community of content creators," something that SecondLife did quite successfully. There are other aspects of the virtual world that have influenced the design of CoffeeandPower, Rosedale says. It's a

"place where people can create new and unique value for each other. So choices like using live public chat to let everyone 'near' each other easily talk - that comes right from SL. Also that it needs to be fun, crazy, quirky - again these are the ways things like this get started. Gotta get some basic parts in place and then get out of the way and let people do strange and beautiful things with it. We bet there will be a much larger and different range of things people will do with CoffeeandPower than anyone (including us) can initially imagine - just like Second Life."

Rosedale co-founded Second Life in 1999. He stepped down as CEO in 2008, although he did take the reigns of the company again briefly last year as an interim CEO.

Once pegged as an up-and-coming competitor to Second Life, Blue Marks is a CryEngine 2-powered virtual world from developer Avatar Reality. On Friday, the company said it will no longer add new content to the PC version of Blue Mars, switching its efforts to develop a version of the virtual world on iPhone, iPod Touch, and iPad devices. The servers will remain online, but there will no longer be any technical support. Current city developers will no longer be charged monthly hosting fees.

The move from a desktop client to a mobile platform makes sense in terms of general trends towards mobile gaming. And if Blue Mars is successful with its release, it will be the first 3D virtual world on the iPad. But some question whether mobile devices will be able to provide the same sort of experiences - resource-intensive in terms of graphics, data, and processing power - that a PC can.

The Future of Virtual Worlds

The change in the focus of Blue Mars development - along with a larger company shake-up echoes some of the problems that Linden Labs Second Life has faced in the past year - layoffs, management changes, and a struggle to woo new "residents" and maintain interest in 3D virtual worlds. For its part, Linden Labs has recently hired Rod Humble, a former EA Games exec, as CEO.

It remains to be seen if making virtual worlds more like games or more like mobile apps will be what saves these companies from more bad news in 2011.

2010 was hardly a banner year for Second Life, and Linden Lab says it hopes that a new CEO at the helm will bring "fresh perspective, renewed energy, and creativity" to the new year.

Second Life describes itself has "leading 3D virtual world," but virtual worlds have never quite taken off. Second Life does offer an immersive, user-created world and boasts a strong virtual economy, and it still has a devoted user base - over 750,000 unique Residents spent morre than 105 million hours "in world" in the third quarter of this year alone. Nonetheless, Second Life has a notoriously steep learning curve and substantial hardware requirements - perhaps limiting a more widespread adoption.

By selecting Rod Humble to lead the company, Linden Lab has chosen someone who knows popular gaming. Most recently, Humble headed the EA Play label, which includes the best-selling PC game franchise of all time, The Sims. Prior to working at Electronic Arts, Humble served as VP of Product Development for the MMO EverQuest. With a strong background in gaming, it will be interesting to see how Humble's direction shapes Second Life, something that fans often insist is "not a game."

Linden Lab intends to move the Second Life environment to a browser- and mobile-based platform, obviating the need to download software. It will combine its product and engineering divisions. Future plans include migration to social networks, like Facebook.

PaidContent pointed out that Linden Lab, "hasn't raised outside cash since 2006. At least two of its backers have sold their stakes."

Massively reported that the company's Singapore office is being shut and its Germany head is leaving.

In a post on the Second Life blog, Tom Hale, Chief Product Officer for SL owner Linden Lab, said user-to-user transactions in the immersive world spiked 30% over last year to $160 million, breaking all previous company records.

The company itself makes money in part by assessing a transaction fee on in-game commerce.

Additional high-points for the company included included the fact total sales on Xstreet, the Second Life marketplace, reaching $2.3 million, an 82% increase year-to-year and a 24% increase over the previous quarter. Total Linden Dollars exchanged on LindeX, the in-game currency exchange, totaled $31 million, a 9% increase over the previous year, and monthly unique users with repeat logins peaked in March at 826,214, a 13% increase year-to-year and an all-time high.

Hall said the money the company invested in customer acquisition was the hinge his economy turned on. Infrastructure improvements included a new viewer and data center. He also noted that Valentine's Day was the single largest day on their virtual currency exchange, Xstreet and theorized that the success of the movie Avatar, which was heavy on immersion, might have inspired a new wave of people to try it.

Update: Linden Lab's PR rep, Rena Grant from Edelman, contacted me to dispute the notion they charge in-game transaction fees. I have a couple of questions back to her and will clarify as necessary.

Update: Ms. Grand told me Linden charges an "exchange rate" on the virtual currency that is used for in-game commerce and they do not charge a commission on in-game commerce.

ReadWriteWeb has already written about data visualization capabilities in sites like Second Life. Due to a fledgling economy, many suggested that these institutionally-branded education initiatives may also become popular. Nevertheless, apart from this recent endorsement by the University of Texas, mainstream educators still don't have the green light to teach in virtual worlds. Many argue that video teleconferencing and instant messaging have replaced the need for virtual world interaction. However, neither of these offer the same immersive experience.

While we know that face-to-face learning is currently the most successful teaching method, if you had to choose an online learning environment, would you consider a virtual world? Let us know in the comments below.

The software, Glasshouse by Green Phosphor, lets you take data from either a spreadsheet or database query and place a 3D representation of it into a virtual world environment where it can then be explored interactively. Users are inserted into the virtual world as an avatar which can then manipulate the visualization of the data by drilling down into it, re-sorting it, or even just spinning it around to see it from all angles.

The benefits to working with data in this way don't really need to be touted too much - many businesses already perform data visualization, often using expensive software and powerful computers to do so. What makes what Green Phosphor does so interesting is not that they've come up with a way to visualize data - it's that they've come up with a way to leverage the platforms of virtual worlds to do so.

How it Works: CICP (Think HTTP for Virtual Worlds)

Some of the company's solutions involve using a proprietary virtual world, "Glasshouse," for data visualization, but for Second Life, Sun's Wonderland, and other virtual world users, they've developed adapters that project graphs from Glasshouse into whichever virtual world you're using. The only requirement is that the virtual world be CICP-enabled.

CICP, or Content Injection and Control Protocol, was developed in-house by Green Phosphor CEO Ben Linquist and released to the public domain. The standard, cross-platform protocol essentially serves as HTTP for virtual worlds where it works as a communication mechanism that the Glasshouse gateway can use to generate temporary artifacts in the worlds. Already it has been added to Sun Wonderland and released under the GPL license there. It has also been implemented in Second Life with the help of a Java servlet and released under a BSD license. The company is currently working to add it to other virtual worlds, too.

Data Viz for Anyone: From Spreadsheets to Biotech

Depending on company size, there are three different levels of service available. First, a spreadsheet world lets you upload Excel spreadsheets that can then be visualized in a web interface. Next, there's a workgroup appliance that delivers data visualization and virtual conferencing needs to small or medium-sized businesses. And finally, enterprise solutions designed especially for virtual markets like bio-technology have also been developed as more customized solutions.

As Linquist explains in this YouTube video, the technology is even advanced enough to produce a virtual laboratory where researchers can perform model-based drug development.

If you have Java installed, you can test their web-based virtual world demo by clicking here (launches Java window). For more information about their solutions, visit GreenPhosphor.com.

Now, the shot in the arm for Second Life seems to be as simple as a redesign that emphasizes the benefits of the community to would-be users and encourages them to register to try the service for themselves. Plus, they've thrown some Cooliris-like panning interactivity in there for good measure.

After testing the new design for one week, Linden Lab is convinced the new design is doing a better job than its current home page:

"Over the past week we've been comparing the core metrics (traffic, registrations, logins, economic and inworld activity) of the new page with our existing new user home page. The data is encouraging: the new design performed better in almost all aspects, so we are moving full steam ahead with launching the redesigned page."

And so it seems that finding new life - or a Second Life - could be as simple as communicating more effectively. It will be interesting to see if this return to basics makes 2009 a better year for Linden Lab and the residents of its community.

Still, let's face it, playing what are essentially online computer games where the "fun" is in interacting with random strangers may have been an interesting experiment, but now that the hype has died down, we can see that they only attract a niche crowd. These worlds will not deliver the promise of the 3D web that we had once imagined they would.

Where 3D is Useful: Mapping

When 3D technology is implemented for more practical purposes, though, it can be incredibly useful. Some of the most innovative developments in 3D technology involve advances made in mapping. The newly redesigned Google Maps' Street View is a great example of this. Their recent update lets you drag a figure (the "Pegman") over any street to get a preview of Street View for that location. When the Pegman lands, the whole map turns into a Street View viewer. Google Maps with Street View has also been delivered to our mobile devices where it helps us navigate unknown areas of our world when we're away from our computers.

Meanwhile, Microsoft has also integrated 3D into their mapping platform, only in a different way. They launched their Live Labs project Photosynth in August, which lets you stitch together photos to create detailed 3D environments. Last month, they integrated Photosynth with Live Maps, letting you explore various landmarks and cities in 3D as well as share your own "synthed" photo collections with the other users of Live Maps.

Where 3D is Cool: Browsing

Also this year, we've seen some developments in the use of 3D to deliver better visual browsing experiences. Amazon launched their 3D Winodwshop site which lets you virtually browse through the company's top products.

We've also seen other web applications integrate this 3D visual browsing technology including ManagedQ's semantic Google-based search, Photo Stream's visual newsroom as well as newer search engines like Viewzi and SearchMe. Although none of those have hit the mainstream, they all are interesting experiments.

However, one of our favorite 3D browsing tools is the technology from Cooliris, a browser plugin that lets you transform the web into an immersive 3D experience. With Cooliris, you can surf a "wall of content" from sources like Google, Flickr, Yahoo, SmugMug, and DeviantArt. In October, the company also launched an iPhone application that does the same.

Similar to Cooliris's iPhone app, Microsoft took Seadragon, the technology that supports Photosynth, and released it as an iPhone application callled Seadragon Mobile. With this mobile app, you can browse several image collections including the Library of Congress maps from the TED demo, NASA images, a two-billion by two-billion pixel map of the world, and you can also load custom content via an RSS feed.

3D's Future: Shopping?

As The Guardian reports today, there are many people who think that online shopping is the next frontier for the 3D web. In particular, they make mention of a company called ExitReality, who is developing a 3D plugin that can transform any 2D web site into 3D. Visitors using ExitReality's plugin can change into avatars to wander through web sites and chat with other users. Says ExitReality founder Danny Stefanic, who has been working with virtual reality since 1994, "it's not a replacement for viewing the 2D page - that is still the best way to consume that content - but it gives everyone a 3D space that they can utilize if they want to. And what we have found is that instead of the two- or three-minute session times of 2D websites, when we are in 3D and exploring and chatting to people with similar interests, we spend 20 to 30 minutes there." He notes that sites implementing 3D could offer online sales agents that could chat to visitors or demonstrate products.

In other words, 3D for marketing and sales. Sigh.

Is There Nothing Else?

Last year, we had once wondered if 3D interfaces were useful or just a novelty. We think the jury is still out on that. Besides mapping of course (which extends to new developments in Google Earth, too), the majority of the 3D launches we've seen over the year are fun...even cool...but not incredibly life-changing. In fact, the newest uses of 3D are even more kitschy and even less useful than those that we saw earlier this year. The most recent 3D sites actually backtrack to 3D's beginnings and require you to break out your nerdy red-and-blue glasses to view them. For example, a site called Snowdin.com, is a new holiday Flash production by Colle+McVoy that's entirely in 3D.

For even more mindless fun, we just discovered that you can create your own red-and-blue doodles at the new Neave Anaglyph site.

Sure, we may have rushed out to the car to retrieve our glasses left over from the weekend showing of "Bolt 3D" to view these sites, but we don't imagine that 3D glasses will ever become the new must-have accessory for internet surfing. So where does that leave 3D technology for consumers browsing the web? Fun, games, and virtual worlds? Yes, that seems about right. Although some businesses will find 3D technology useful as we noted before, we did not see this technology become the most ground-breaking innovation of 2008...unless you count the pinching and zooming that took place on our iPhones.

Image credit: 3D images above courtesy of Adverlab; main image: ny3d

RFLofSL was a huge success last year, raking in over $100,000 dollars and attracting more than 1,700 participates in the virtual walkathon event. This year RFLofSL is looking to top themselves with their relay today. This year, the fundraising goal is $125,000. RFLofSL is also expecting to attract more than 2,000 participants.

Exceeding Expectations

So far, the event has raised over L$43,408,587 in Linden™ dollar donations, which is the currency used in Second Life. In American dollars, that's over $180,000! They've also raised over $4500 in donations outside of Second Life in the first few hours of starting. There's still more than 20 hours left on the clock and it looks like this event will exceed all expectations.

Get Involved

In the web relay,

The main difference is location. SL residents set up and decorate campsites, and sell small items to help raise Relay money just like at your local relay. However, since this is a virtual environment you may see some teams offering blimp rides, or holding sailboat races inside the park.

Show your support for the Virtual Relay and find out more information on how to get involved at the official Relay for Life in Second Life site.

Users can choose from a number of preset animations for their characters, ranging from shaking hands with others, to applauding, crying, etc. By double clicking on certain items in the virtual world, users can also often activate some preset animations such as sitting down on a chair or jumping off a dive board.

Setting the plugin up and creating an avatar is a very simple process. Creating rooms, too, seems quite easy, as you can quickly import a number of templates to get started. Currently, all virtual items for Lively are for free, but chances are that Google will start charging for premium items in the future.

For now, the content in Lively is being created only by Google, though over time, they are planning to allow users to start creating their own content as well.

Rooms can be easily embedded into any webpage and worlds often launch with a basic skeleton of the room within just a few seconds.

Graphically, Lively runs very smooth on our test machine here and the visuals, while not comparable to a modern game, are not too bad either. Interestingly, there is no first-person view available, instead, the world is always seen from a camera perspective the user can control.

One area where Lively could definitely needs some improvement is in how users move their avatars around the rooms. To move an avatar, users basically have to drag them through the room, while most people we have met in Lively have commented that they expected to see a more game-like approach where users use the keyboard to move avatars through the rooms.

Second Life users might find the Lively rooms and the amount of customization they can do to them rather restricted - however, Google's idea seems to be less to create one large virtual world, but to give publishers an opportunity to create their own small virtual world for their readers and visitors.

It's interesting to see Google moving into this space. There have always been rumors that Google might be working on a similar product for Google Earth. As of now, the rooms in Lively are compartmentalized and there is no way to move or communicate from one room to another, but given that this is only a first release, this might (hopefully) change over time.

While unaffiliated parties have created versions of this process before, Linden says theirs is the first effort to achieve trans-world teleportation without logging out of one world and logging in to the other. No virtual goods were transported across the barrier, a major concern for Second Lifers concerned with virtual property theft and rapid depreciation of their assets' value.

All concerns aside for the moment, the possibilities are very exciting. Below is a corny but appropriate video produced about the event. (Removed until autoplay issue resolved, but available in the original announcement.)

Linden faces widespread user dissatisfaction about its platform's stability, intellectual property protection and other concerns. A lively discussion in comments on the announcement is a good place to get a look at the public mood.

Interoperability across virtual worlds could be an important step in maintaining the viability of Second Life. As an increasing number of virtual worlds proliferate, user and digital asset data portability is as likely to be essential for Second Life as it will be for other platforms online. Walled gardens will face increasing competition from the open world at large, so taking a leadership role in enabling that openness is a good way to thrive in the coming era of openness and portability.

You can laugh at Second Life and you can complain about it if you want, but we are excited about this news. Cynicism may have its place, but we'd argue that today isn't the time for it.

We congratulate Linden and IBM for their achievement and are excited to see what will come of this big step. Watch for news about the general availability of this functionality - once policy concerns are dealt with or once outside parties figure out how to achieve the same thing.

A couple of years ago, when Second Life-hype was at its peak, businesses flocked to the virtual world. But last year, the LA Times reported that as quickly as they had set up shop, many of them were leaving Second Life due to lack of interest. We reported a couple of months ago that Second Life's user numbers had plateaued, saying that the much-hyped virtual world "may have already proven itself too inhospitable to scale."

But could that trend be reversing? The same Los Angeles Times is now reporting that companies are taking a second look at Second Life in order to cut costs. Companies "are creating employee-only islands and office buildings, then encouraging their staff to meet there," says the paper. "Compared with plane tickets and hotel bills, it's not that expensive: A 16-acre private island in Second Life costs $1,000 plus a $295 monthly maintenance fee."

"Virtual worlds are relatively inexpensive, don't require a great deal of start-up technology infrastructure, and provide a naturalistic, immersive approach to simulating space, people and objects," according to Forrester Research analysts Erica Driver and Paul Jackson in a report entitled "Getting Real Work Done in Virtual Worlds."

Intel, Sun, and IBM are just some of the big name companies trying out work environments in Second Life.

Many companies that left Second Life the first go around did so due to vandalism, however. Can you really create a good learning environment in a place where giant, flying penises could attack at any moment?

"This is an adolescent technology that's lurching and pushing in different directions and getting a sense of itself," Kemp told the AFP. Of course, even while schools and companies attempt to figure out how best use Second Life to promote good professional and learning environments, some schools have already figured out how to exploit the technology for educational gain. Researchers at Rensselaer Polytechnic Institute, for example, are using Second Life as a cheap way to test out artificial intelligence for robots.