The business case for OpenSim

A reader asked me today about the OpenSim business case — are there enough users on any of the grids to make it worthwhile for a business to set up a presence there instead of in Second Life?

The short answer is: no.

Second Life’s average concurrency is around 50,000. If you log into Second Life, depending on time of day, you are likely to find anywhere between 35,000 and 65,000 other people logged on. (See Tateru Nino’s great statistics page for more details.)

Meanwhile, the most active commercial grid, Avination, reported just under 9,000 unique users logging in over the past 30 days, according to our last grid survey report. OSGrid, the largest grid, reported  around 3,500. (InWorldz does not release its active user numbers.) All other grids reported 2,000 unique user logins or less. All together, all the top 40 public OpenSim grids combined had less than 20,000 monthly users.

Meanwhile, Second Life has about 1 million unique visitors a month. Or, at least, it did in October — Linden Lab stopped publishing this data last fall, and it may have gone down a bit since then, but it is still a difference of a couple of orders of magnitude.

Unique monthly users as of mid-April. Second Life data -- in red -- is from October 2010.

If you are a merchant, looking for the largest possible customer base for your products, there is currently no alternative to Second Life.

That doesn’t mean that there’s no room at all for other grids. In fact, while Second Life’s base of potential customers is large, so is the number of competitors. A new OpenSim grid might offer a merchant an opportunity to make a reputation for themselves in a smaller, more comfortable environment.

A second store in a new grid — in addition to existing Second Life outlets — can also be a hedge against potential problems inside Second Life, such as a loss of access to your account

And there are several other ways in which OpenSim can make a great deal of economic sense to businesses.

Bring your own users

Second Life’s massive user numbers are irrelevant if your target audience or customer base isn’t there. If you’re a company looking for virtual meeting and collaboration space for your employees, or a school looking for virtual land for your classrooms, then Second Life’s user numbers are completely meaningless.

Instead, other factors come into play — support, land costs, features, security.

Depending on what your company is looking for, OpenSim can be a better option. The costs are much lower, for example, and some grids and independent hosting providers have excellent reputations for support.  In addition, OpenSim has many features that Second Life lacks, including mega prims, region and inventory backups, hypergrid teleports, and mesh.

OpenSim can also be modified, since it is open source software.  Companies can integrate it with their corporate directories, for example, or back end databases. And OpenSim can be run fully behind a corporate or school firewall, for maximum security.

Beyond students and employees, there are other groups that would fall into the “bring your own user” category, as well.

For example, if you have a Facebook group, a quick and easy way to bring them in-world is to create a Kitely region. (More about Kitely here.) For occasional meetings, it would be a very cost-effective solution.

Similarly, if you run a role playing guild, or a niche adult group, and your members will follow you whereever you go, then an OpenSim environment can offer more bang for the buck.

Artists and creators

If you enjoy expressing yourself in 3D — but only your friends visit your creations — then building in OpenSim will give you much more room to work in. You can run a home-based region or group of regions for free, or pay as little as $10 a month for professionally hosted regions on OSGrid or other open grids. (See full list of hosting providers and their prices here.)

Besides being able to create for a low, low price — with no cost to upload textures — you will also be able to save backups of entire regions. If you need to do a public showing and expect to have more attendees than your home-based or discount region can hold, upload the entire region file to Kitely for the event, or ask your hosting provider for additional bandwidth for just that short time — some hosting vendors are beginning to offer short-term cloud hosting for events, or can temporarily allocate more resources to your region or move your region to a higher-capacity server. (More about cloud-based sim hosting is here.)

Build once, sell everywhere

Even if you produce virtual goods for retail sale, you can still benefit from using an OpenSim grid as a manufacturing area.

In Kitely, for example, an unused region is just 10 cents a month, allowing you to create an unlimited number of regions in which you can warehouse your finished goods.

Similarly, discount hosting or home-based hosting will also allow you to create objects at low or no cost, and will allow you to bring in your employees or collaborators.

Once an object is finished, you can export it with the built-in export tools in Imprudence and other third-party viewers, and upload it to Second Life, InWorldz, Avination, or other grids.

Bellissima Square on Bella region in InWorldz is just one of the grid's many shopping venues.

With OpenSim, you can have as many backups of your regions as you need, including multiple versions of the same build.

And you will retain ownership of your items regardless of what happens to your Second Life account. You will also not lose anything if your grid shuts down entirely, as Meta 7 just did (full story here.)

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Maria Korolov

Maria Korolov is editor and publisher of Hypergrid Business. She has been a journalist for more than twenty years and has worked for the Chicago Tribune, Reuters, and Computerworld and has reported from over a dozen countries, including Russia and China. Follow me on Twitter @MariaKorolov.

5 Responses

  1.' Gaga Gracious says:

    Good article Maria but the traffic to Opensim grids might be higher than you suggested at 20,000 in 30 days. If you take account of all the Hypergrid enabled regions running Diva's distro connecting with each other and major grids like OSgrid then this somewhat hidden traffic could be adding a lot more. Some grid owners have reported 50% of their own traffic is via hypergrid but as I have said on my own blog it is very difficult to get the full picture unlike SecondLife which is all under one roof and can publish a full count.

    In the case of InWorldz I can give a good guesstimate of the 30 day user traffic by adding up the daily counts which they do publish and compare it with other grids. My figure for InWorldz is between 6 and 7,000 logins per 30 days. I collect daily counts at peek and off-peek times for around 20 grids which is not a perfect method but gives a good idea. So add 7,000 for InWorldz and at least the same again and possibly more for the many small HG enabled grids and I think the total is more like 30,000 to 40,000.

    More importantly, in the six months or more I have collected daily counts I noticed significant growth. From Sept 2010 to Jan 2011 it appears from my findings to have doubled and it is continuing to grow while SecondLife remains static. Also, the security is set to improve ten fold with the release of Opensim 0.7.1 so it's for the merchants to decide if they are willing to supply goods to customers from other grids as well as the one/s they have a store in. Some do have a presence on more than one grid and, while admitting sales are not high, they make enough to off-set costs which are a lot less in Opensim than SecondLife. Personally, I think the time is now right to establish one's business in an Opensim grid. It is growing quite quickly and there are more grids preparing to come on line so if investers in the grids have confidence then the merchants should take note. Opensim offers the probability of a much larger market than SecondLife given time.

  2. Gaga —

    I totally agree with you — the trend is in favor of OpenSim. And I know that there are educational deployments with thousands of educational programs on OpenSim, so the total number of users could easily be over 100,000.

    However, most of the private grid deployments aren't really embracing the hypergrid yet — they're for schools, businesses, etc…, often behind the firewall.

    The Diva Distros are great, but don't typically bring a lot of users — usually just the one person running it, maybe a couple of friends.

    It also doesn't help that the hypergrid is fragmented, with the ReactionGrid and related grids running on an old, incompatible version of OpenSim.

    Plus, there's no method yet for attracting a multi-grid audience — if you want to get a lot of people to your destination, how would you go out to all these grids and invite people? Nobody knows where those grids even are.

    Eventually, though, we'll have events directories, multi-grid advertising networks, publications covering stuff happening on the hypergrid, search engines, all that good stuff.

    So one good reason for a companies to get on the hypergrid is to be ready for that day when it comes.

    One thing the dot-com boom taught us is that being a first mover makes a difference. How many companies have tried to copy Amazon, eBay, Yahoo, Netflix…? Do we even remember them?

    In the physical world, we can have Coke AND Pepsi, Domnos AND Pizza Hut, McDonalds AND Burger King — but the Internet's network effect leads to a winner-take-all situation.

    Online, though, there don't seem to be a lot of room for second place. If the hypergrid works the same way, startups should be working on their virtual strategies now, before some kids in college dorm rooms somewhere grab everything.

  3. Gaga —

    Also, how are you gathering the usage data? Manually or via an automated process?

    We're doing it manually once a month, so there's no way we'll be looking at online users. If there was a way to get the data in an automated fashion, though, we could probably collect a lot more data.

  4.' Gaga Gracious says:

    Hi Maria

    I do the same as you. I manually collect the daily traffic figures from a selection of grids at peek and off-peek times. I miss some of course and here and there more than a few days when I’m away so I wont say my metrics are 100% reliable. But when I analyse your data, Tateru Nino’s and my own I do get a good general picture. I do travel around a lot too and actually look at the activity in the grids so it’s not just metrics that I work on. I am always interested in who the merchants are and if they have outlets in more than one grid. I take a close interest in role players too because they usually represent larger groups of people spending time on a grid. Events generally bring out the hard core supporters so don’t really contribute much to the over all traffic unless they have a lot of events (some actually do). One of the things I do as well, when I have time to spare, is just hangout in welcome areas to count arrivals – both noob and regulars at times when the grid appears to be experiencing a lot of traffic. Unlike SecondLife which dose have a lot of bots, campers and alts contributing falsely to the traffic, Opensim grids don’t generally appear to suffer that too much. It’s all these things on which I build my analysis.

    I guess it is possible to ping grid servers to collect usage data as well and then store it on a database which could then be called using php scripting to give current metrics on a web page. I have thought of looking into doing it that way but, as yet, I haven’t really investigated to see if it’s possible.

    When you said “there’s no method yet for attracting a multi-grid audience” this has occupied my thoughts a lot in the past year too and one answer to my mind was if the third party viewer developers did more with the grid list function so that grid owners could send data about their grid either directly from the viewer or via a web page so that whenever someone opens their viewer they get the option to search for a selection of grids at the point of login and even store user names and passwords for a favourite grid. The stored user names was in the MeerKat viewer and I wrote about it on my blog recently here…

    To my mind the viewers could offer a lot of support to the open metaverse since the viewer itself is right in the front line. It just seems the most logical thing to do and the simplest way to maintain an up-to-date list. It would also save inexperienced users needing to add grids themselves (if they knew any) or rely just on those favoured grids the viewer devs chose to make available in the drop down menu. Imprudence developers are working on something along these lines but they have so much to do I don’t think it has high enough priority for them. Certainly, I have been asking for this on their forums for over a year and they have acknowledged it but we have to just wait and see.

  5. LMPierce says:

    In our pluralistic society (and more so, pluralistic world), it seems that while there will be some big winners that appear to dominate their market, there will be even more highly successful winners than ever in many diverse areas. Although Facebook dominates, LinkedIn is the networking system of choice for serious professionals. Careerbuilder and Monster are like the Coke and Pepsi of job searches, but for academics, HigherEdJobs and the Chronicle of Higher Education are the most viable and appropriate resources. My hope for virtual world developers is that they continue to strive for excellence and distinction instead of dominance, which would keep the technology vital and interesting, and, for the many needs in our world today, relevant.