Second Life Claims Social Network Crown

OK, guys. We get it. Second Life is not a fad. But a rival to social networking sites? We're having a little trouble with that one. The idea was floated in the latest collection of Second Life usage statistics released by Linden Lab last week. The press release stresses the claim that users have spent more th

Artwork: Chip Taylor
an one billion hours in-world, but it also describes a few pieces of information that seem intended to put the 3D virtual world way ahead of the social networking pack in several key areas:

"Second Life Residents spend an average of about 100 minutes inworld per visit. This average session time is significantly greater than those seen with popular social networking Web sites and reveals the uniquely high level of engagement Residents have with Second Life."

"The equivalent of more than US$1 billion has been transacted between Residents in Second Life, who purchase virtual goods and services from one another. The inworld economy grew 94% year-over-year from Q2 2008 to Q2 2009. Now at nearly USD50 million each month in user-to-user transactions, the Second Life economy is on an annual run rate of more than a half billion US dollars, making Second Life the largest virtual economy in the industry."

"More than 18 billion minutes of voice chat have been used in Second Lie since voice was introduced in 2007. Voice minutes grew 44% year-over-year from Q2 2008 to Q2 2009, and more than 6 billion minutes of voice have been delivered in 2009 alone, making Linden Lab a major VoIP provider."

Of course, virtual economies and voice chat are two areas in which Facebook, MySpace, and most other text/photo oriented social networks are lagging. The big boys have been slow in getting their virtual currency efforts off the ground. Neither site has fostered marketplaces for user-created virtual goods, although game developers have had some success selling virtual goods in Facebook. Voice chat is not natively supported in Facebook or MySpace, although independent developers have been creating voice applications for Facebook.

Where does this leave Linden Lab? It's hard to say, at least when it comes to the all-important revenue metric. Voice chat is free to Second Life residents, and the closely-held company doesn't state how much money it's making in its virtual economy (in our interview with Mark Kingdon earlier this year, he would only say the company is profitable). News Corp. and Facebook are also not very forthcoming with their virtual goods sales figures. A September 2008 estimate placed Facebook's annual revenue from virtual goods at $35 million per year, but that's not an official number, and it could have changed a lot over the last year -- especially when you consider the sheer size of Facebook's user base when compared with that of Second Life.

Sources and research: Linden Lab press release, The Industry Standard, VentureBeat.com, Facebook.com

E-mail Ian at ian@thestandard.com. Follow Ian on Twitter at http://twitter.com/ilamont. Standard updates and asides are available at twitter.com/the_standard and in our newsletters, and you can join our LinkedIn group.

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