Virtual worlds may work in a similar way.

–matt

- In the late 1990’s, when various trendy internet stocks like Amazon.com and Netscape were all the rage, people didn’t get my cyncism/humor when I stated that most mom-and-pop grocery stores made more money than Amazon.com/Netscape… which was true, because both were hemmoraging money. Furthermore, based on ROI, mom-and-pop grocery stores are (probably) still more profitable than Amazon, Netscape being deceased.

- Another interesting division between virtual worlds is to look at those that start out small (and obscure) and ramp up, while those that start out with a wad of marketing cash, get lots of users, and then die away over the next few years. The small & obscure approach allows the world to iron out the bugs and perfect the game, such as with Runscape, SL, or Eve Online. The big bang approach usually results in hit-based games and large numbers of frustrated players.

Note: In a sense, WoW managed to start out “small & obscure” since their initial population was 200K, but has gradually ramped up to 6M(?).

Landing investors isn’t a goal. It’s a means to an end. Further, Jagex has managed to land far more investment, with far less media hype, because they have an actual, (highly) profitable company. They’ve received fat buy-out offers from major media conglomerates and can afford to just turn them down.

Also, having fewer players at this point is a good thing, since it can reduce the negative word-of-mouth that sometimes comes from having large groups of people, as well as other benefits like I described above.

Three years after release, it’s good to have relatively few players (compared to the amount that’s been spent on SL)? I’m not even sure how to respond to this.

The point I was trying to make in my post was that when you put SL and Runescape side by side you get a pretty interesting comparison. One has focused almost entirely on media hype and has failed, despite initial, large VC backing, to make a single dollar in profit, at least as far as I’m aware of. Runescape, started with no VC backing, has managed to become one of the largest virtual worlds in existence, has attracted more VC backing than SL, is extremely profitable, appears to STILL be growing more quickly than SL, and has done it all without spending its efforts on hype.

Sure, there are differences in the products themselves that make this a matter of not quite comparing apples to apples, but I think the differences in methodology and the respective results say quite a bit.

–matt

I’ll also point out that SL’s PR pointed out their growth rate for a few months earlier this year. It’s easier to claim double-digit growth when it doesn’t take many new signups to achieve that.

My gut feeling is that they’re doing the right thing. If they truly want to be “The Metaverse”, then it’s going to take a lot of work and money to make that happen. By focusing on PR and getting their name in front of investors instead of just customers, they’re ensuring they have access to some of that money. Also, having fewer players at this point is a good thing, since it can reduce the negative word-of-mouth that sometimes comes from having large groups of people, as well as other benefits like I described above.

My analysis,