iinnovate 9: Philip Rosedale, Founder of Second Life

Matt and Julio – Episode 9: Philip Rosedale, Founder of Linden Labs and Second Life 

Hi and welcome to Episode nine of iinovate.  We’re almost at the big number ten here.  My name is Matt Wyndowe, and together with Julio Vasconcellos, today we interview Philip Rosedale who is the CEO and founder of Linden Labs, creator of the online world, Second Life.  For those of you who aren’t familiar with Second Life, it’s pretty crazy.  It’s this online world, which is totally 3-D, in which people can interact and build things.  It’s become a pretty big deal, like cover of Business Week big, like over one million users big.  It’s a little hard to explain, so I suggest you check our website at iinnovatecast.com and there we posted someone’s Youtube video, which sort of goes over what happens in second life and shows you what it’s really like, which is pretty cool.  Anyways, here Philip talks about where Second Life came from and where it’s going, and we also feature a special question from Andy Grove, who is the founder and former CEO of Intel.  So that was really cool hearing Andy’s opinion on that.  So anyways, I’m way over our self-imposed one-minute intro limit, so I hope you enjoy the podcast and thanks very much for listening. 

Matt: We’re here with Philip Rosedale at Linden Labs.  Philip, welcome to the podcast. 

Philip:  Thanks.  Thanks for having me.   

Matt: So Philip, for our listeners who haven’t used Second Life or are unfamiliar with it, can you give a quick idea of what Second Life is? 

Philip:  Well, part of what’s cool about Second Life is if I could give a really short, clean description, it probably wouldn’t be as interesting.  But, Second Life is an online world, so it’s a 3-D online world that you can actually walk around in that has the very unusual property that everything in it is made by and can be changed by you and everybody else who lives there.  So, that makes it very different than say an online video game, where all of the stuff you encounter is stuff that you can’t change.  In Second Life, the world itself is editable, and that makes it, you know, very, very special and different.   

Matt:  So as a user, I log on to Second Life, download it on my computer.  What is the first thing that I’m going to see? 

Philip:  Well, the first thing you’re going to see, you’re going to make a small download, it’s about a 25-minute download, so it’s pretty quick.  You’re going to fire it up, and then you’re going to be on a little tropical island.  And on that island you’re going to be able to walk around, do a little chatting, you know, learn how to communicate, learn how to change your appearance, you know, which is something.  In Second Life, you can be anything, you know, literally down to the tiniest detail that you want to be.  So, changing your appearance, changing your Avatar, as we call it, looks, is one of the first things you do.  And then you’re going to move to a help island where there is a bunch of real people to hang around with and talk to and ask how things work.  And then from there, you can just kind of teleport into the rest of Second Life, which is this extremely large place. 

Matt:  It’s a very large place.  Can you give us some metrics of how successful Second Life has been? 

Philip:  Well, aside from the fact that all that these things that I’m telling you are growing kind of more than 10% a month, Second Life right now is about 90 square miles.  So to put that in perspective, that’s coming up on twice the size of San Francisco, about the same size as Amsterdam, a big city.  It has a density that’s more like Tokyo, there’s just stuff everywhere,  and it’s growing at 10% a month, as people put new servers online.  In fact, at this point it’s close to 4000 server machines simulating, depending on how you count, about 25 or so terabytes of user created stuff.   

Matt:  And there are real businesses that of course have set up shop on Second Life.   

Philip:  Yeah, Second Life also has its own economy.  So, you know, part of entering another world is the expectation that that world has an economy of some kind.  And Second Life’s economy has a real currency that you can exchange U.S. dollars to get a currency, and that if you make money in Second Life by building things, selling things, providing a service, doing whatever, you can actually take those Linden dollars that you earned, and you can go to this currency exchange, and turn them back into US dollars and pay your rep in the real world.  And right now, the sum of all the transactions that people are doing with each other in the world, adds up to about $8 million U.S. a month.  So it’s a big economy to participate in. 

Matt: Wow.  So this idea sounds great now that it exists, but where did it come from?  Where was this idea born? 

Philip:  Well I think that a lot of people have dreamed about this collective idea of, you know, the metaverse to use Neil Stevenson’s word for it.  The idea being that, you know, it must be possible.  We digitized audio and video, why can’t we just digitize, you know, Earth.  You know, why can’t we just create a world which is simulated on computers that we access through computers, but that has, you know, special and different properties in comparison to the real world?  So I think that dream has been dreamed by a lot of people.  For me personally, I was interested in physics as a kid, and electronics and computers and just, you know, making things.  I was always taking things apart and figuring out how they worked and I was very imaginative and creative so I always just wanted to make things.  And as computers got networked in a common way, you know, when the internet and IP networking came around, I was just immediately like well, the ultimate thing you can do with a lot of computers is connect them together over the internet and have them simulate a world.  And so I think for me, and then for us at Linden Lab, that was, you know, what we wanted to do.  We wanted to build sort of the ultimate Lego or erector set, if you will, in which you could build anything you wanted.   

Matt:   Do you remember any single ‘ah ha’ moment where it really came together, and you’re like ‘this can really be done’? 

Philip:  Well, I think that we, I think a critical moment in the company’s history was a board meeting that happened in 2001, so this is some time ago; where we were demonstrating the capabilities that we had created, so this was a very early version of Second Life, where you could shoot things, and you could chase each other around, and you could, you know, we had buildings and, you know, you could knock over pieces of the building, and so we kind of had this,  these vignettes of little games that you could play, sort of using the technology.  But what we hadn’t really thought a lot about was this idea of collaborative creativity, but everything even then was totally live, you know, so you build the building with your friend standing there, watching you, you know, put the walls up.  And so after we did this little shoot ‘em up game, kind of demo thing, we moved on in the board meeting and I asked everybody, I said, “Well you guys I’m gonna leave the screen up”, the you guys being the seven or eight of us that were in the other room that weren’t in the board meeting, that were just working.  I said, “Hey everybody, you know, I’m going to leave the projector up, we’re going to go on about the board meeting and talk about stuff, why doesn’t everybody just like build crazy things, whatever, just play around.”  And so, we went on with the board meeting, but then what we realized after a few minutes was that we were just, we were all fixated by the crazy, fascinating chaos in front of us of basically people in the other room, just playing around and making things.  So some guy made like a snowman, one of our guys made a snowman, so he just built a snowman like sitting in the snow.  And then somebody else kind of riffing on that built a bunch of little snowmen like worshiping the big snowman.  You know, so it was just this completely bizarre, wandering through creative space, and it was at that moment that we realized, no, no, no, the thing here, the thing about this metaverse, is that you can make things there with other people.  You can have this collaborative, creative experience that you just can’t have in the real world, you know, unless you’re extraordinarily lucky or at some very unusual event or something. 

Matt:  So how can Second Life translate to the real world or first life? 

Philip:  Well I think there’s a lot of answers to that.  One is that because the Second Life is so plastic, and by that I mean so changeable by you, it’s so easy to redecorate your room or change how you look, or try some weird business that you’ve never tried before.  There is a tendency to, in a great way, to carry that expectation into the real world.  So there’s all kinds of anecdotal examples already in Second Life where you’ll go talk to somebody and you’ll say “Well why did you, why did you, you know, become an architect in real life?”  And they say “Well, I just tried it in Second Life and then I just realized, hey I can actually do this, you know” or somebody loses weight in the real world and they say, “Well it’s just so easy to do with your avatar.”  So I think one of the great things about Second Life is that it creates a world so examinable and so editable and mutable that we expect that from the real world.  And if we expect that from the real world when we leave Second Life, good for us, you know.  I mean, because many things in the real world as we all know, if you just give it a try, you’d find that you could do it.  But, psychology and the permanence of the world sort of conspires against us and keeps us from doing that.  So that’s one example, you know.  There’s a lot of more mundane examples, certainly there’s a lot of things that we’re doing in the real world that can be done really well in Second Life that have an effect on like, live music, you know.  Right now in Second Life, you can go, you can go pitch the owner of a nightclub in Second Life to let you play there, you know, your little band, on Friday night, and if they let you, you go and set up as avatars and you hook up a SHOUTcast stream so you can play 128 KB MP3 to everybody that’s at that club.  And you literally stand up on stage in Second Life and play music for them, sell them your CD’s, get some tips, you get an audience that hopefully talks about you.  You can reach a couple of hundred people in an evening at a club in Second Life, which is more than you’re going to reach down on Polk Street here in San Francisco, and those couple of hundred people are probably going to be more diverse than the people you would have met on Polk Street.  They’re going to be from all over the world, half of them are not going to be in the United States.  So, that’s an example of how it’s just a better way of, you know, launching a little band or something like that. 

Matt:  It’s almost letting you rapidly prototype your own life. 

Philip: Yes.  I think that’s a great way of saying it.  That, we always think of Second Life as being like a time machine.  So if there’s something you want to do and it’s doable in Second Life, you can test it in there and find out what’s going to happen.  I think that’s where some companies, you know, even the real world companies nowadays, in the last couple of months, look at Second Life and correctly see that it’s kind of an ultimate prototyping and taste testing environment.  I mean, if people like it in Second Life, they’ll probably like it in the real world. 

Matt:  So, if you look two to three years out from now, like, what are some of the other things that you think Second Life is going to be used for?  I have been hearing things about education and doing it for business meetings, a lot of productivity type things. 

Philip: Well, I think one of the things we did right as a company was we recognized that when there’s a new medium like this, it always starts off with people just goofing around and playing, having fun.  And then, generally after years, it graduates to a point where people start to use it for other things.  I think that’s a pattern of behavior by the way, that’s universal in the medium.  Just look at television, radio, instant messaging, the web, email, all of those went through a process of initial use where the initial use was just goofing off, you know, it was social, it was artistic, you know.  It was just people having fun.  And that’s the same thing we’ve seen with Second Life, so I think that the evolution of what people are going to use it for is going to be consistent with that of kind of behavior.  So today you see entertainment and playfulness and socialization, people have already started using it now for business meetings because it’s just fun.  I mean, it’s a little bit more expressive, it’s fun, you can make a business meeting incredibly engaging, you know, you can have people around the world sitting around a table in your virtual office and talking to each other and goofing off, you know, and putting on clown suits while one guy’s talking.  I mean, there’s a lot of stuff that you could never do in the real world, so I think business meetings are one.  Certainly prototyping, projects like the Starwood Loft Hotel, where they built the hotel first in Second Life, with the idea of getting feedback, you know.  I just talked to somebody involved in that project and they told me that when they put that hotel in Second Life, the first day, maybe I think they had like an opening party and got a lot of people there.  The first day they got like 25 valid interesting design critiques via email from people who had gone through the facility and a number of them, you know, did and will produce change in the actual construction of the hotel.  It was things like, you know, where the bathroom doors were, you know, very specific things that were very useful to them. 

Matt:  So if I’m a company and I’m thinking about my Second Life strategy, what are some of the things that I should be mindful of? 

Philip:  Well I think mindful is a good word.  Second Life is almost entirely, I guess, is a grass roots kind of environment.  All of us at Second Life are individual entrepreneurs more than real world companies, so I think that as companies come to Second Life, they’ve got to realize that, you know, you’re not going to succeed there unless you’re delivering something of value to the community.  So I think that in the real world people look at owning a billboard as a right to market to you.  In Second Life, people can just respond so negatively to that and so easily avoid you that there’s a greater challenge, greater opportunity for some, but, I think as real world companies come in, they’ve got to respect that you need to support the community of Second Life as it’s emerging or you need to deliver some sort of clear value.  So, you know, a company comes in and wants to build like a sandbox where people can just play in Second Life and build things, hey, that’s something that the community totally loves because there’s so many people that don’t have a lot of their own land.  So, you know, put up a bunch of land and just let people do things, and, you know, have that be a valuable offering to the community.  But, I think companies that come in just trying to say, “Oh we should just be able to take our online marketing program and bring it right to here and market to people in Second Life.”  I think that’s going to be pretty slow going.  Companies that are really thinking about how to create something valuable, should build something that should entertain people while they have a conversation with them. 

Matt: Which companies do you think really get Second Life? 

Philip: Well I mentioned, I think a lot of companies do, you know.  Most of the companies that I’ve had the fortune of like actually talking to on the phone, as you know, Linden Lab doesn’t, we just make land available to people, so we don’t have deals with companies that are doing things in Second Life, we just sell, everybody’s on a level playing field and we just sell them the land.  Umm, but the times when I’ve had, so just socially, you know when I’ve had the opportunity to interact with or I’ve had a brief phone call to talk about ideas with, you know, somebody that’s like the CEO of a real world company, I’ve been impressed by the fact that most of the people reaching out to us thus far are companies that totally get, you know, that this is a completely different language in a completely different environment, and very strong community, and you’d better respect what people are doing there and come up with something that’s genuinely valuable. I think in terms of good examples of companies that have done interesting things, like I say, there’s a lot, the Starwood Loft Project jumps to mind as a pretty good one.  You know, Reuters just opened this big press office in Second Life, and they got really serious about it.  There’s a guy that’s on the ground there reporting from Second Life all the time.  He’s the bureau chief and he’s an experienced journalist.  They have a gadget that you can get that’s like this pager that will bring you to, it gives you the news, it like talks to you and gives you the news all day, but then if you click on it when there’s news, it will bring you to a place where you can sit and watch the video of the news and debate it with other Second Life users.  Now that’s a pretty cool idea.  You know, that’s a genuinely engaging application.  But there’s lots of others.  Smart people are everywhere, whether they’re in big companies or not. 

Matt: One of the things we’re trying to do for all our interviews is to have a guest interviewer in a way.  So oftentimes we’ve had the previous guest ask future guests questions and this time, I actually had the fortune of walking Andy Grove through Second Life; he was just fascinated by it. 

Philip: Andy Grove, the founder of Intel?  

Julio:  Yep.  The former CEO of Intel.  And Andy sent a question to you.  So this is great, wait till you hear it. 

For our listeners who can’t see us, this is incredibly sophisticated, the set up we have here. 

Andy:  Hi, I’m Andy Grove, and I am fascinated by Second Life, and I have a question to ask you.  If you envision three to five years from now what your product is going to do, could you also speculate a little bit about what you need in terms of computing hardware, both on the client and the server’s side, network characteristics, and maybe some software technologies that you need to make that vision a reality?  That would be very interesting for me. 

Philip: That’s great.  What an amazing person to ask that question.  Umm, I need to give an answer.  What I would say is that,  well first of all, Second Life is a kind of a digital world that is fundamentally constrained only by Moore’s law, that is, in fact one of the things I often say in presentations about Second Life is you, you may not like the graphic quality or the simulation capabilities of Second Life today but just wait, you know, the real world isn’t getting any better, our world is getting better at the speed of Moore’s law, so if you’re a big futurist, I think that speaks volumes about what you’re likely to see here.  Having said that, Second Life is critically dependent on both server and client resources as well as the network.  On the client’s side we’d love to see, you know, 30-60 frames per second, just rock solid in Second Life.  What that’s going to take is, you know, … 

Matt:  How many frames per second are you at right now? 

Philip:  Well, on average, people see about a 15 frame per second rate, so we need to sort of double it and double it again.  I think we can do that through a combination of software and hardware.  On the hardware side, I think we need, you know, twice as much just raw clocking and computing speed in the CPU.  We probably need a faster memory BUS, and then the CPU’s themselves need to get somewhat faster as well because we are taxing the maximum number of, you know, triangles that you can put on screen in a 3-D scene.  On the server side, high sustained CPU speeds, but hopefully at lower power dissipation, you know, we’re running out of power for the square feet of rack space that we’ve got machines in servers.  So, on the server’s side, our biggest concern is just much faster CPU’s, memory again, speed there is important as well.  On the networking side, you know, broadband, symmetric high speed broadband connections, just continuing to get out there is really the biggest thing that we need.  I’m probably least worried about that.  We’ve got, you know, network speeds appear to be moving ahead.  In terms of software, you know, there’s a lot of open source software that we use to manage the grid of, you know, nearly 4000 machines that we’ve got out there now.  I think advances in really fine grain utilization monitoring so that you can manage lots and lots of machines, you know, do the sorts of things that Google does well in-house, in a broader context with open software, would be great to have.  That’s my answer.   

Matt:  That’s a great answer.  We’ll definitely, we’ll tell you what he says.  Philip thank you very much for being part of the podcast. 

Philip:  Great.  Thanks for having me.  It was a great opportunity. 

Hey everybody!  I hope you enjoyed listening to that podcast as much as we did reporting it.  Just a quick heads up that we’ll be interviewing Jeffrey Moore, famous author of ‘Crossing the Chasm’ ‘Inside the Tornado’ and ‘Dealing with Darwin.’  If you have any questions that you’d like us to ask Jeffrey, just give us a shout via the webpage at iinnovatecast.com.  Have a great day and thanks for listening.