Darren Herman

Second Life's $1.6mm Spent Today...

I was reading my RSS feeds this morning and saw a very interesting posting from the Second Life Herald about the total amount of dollars spent in Second Life during the last 24 hours.  The number seems extremely high to me as the virtual world has about 1mm residents and has been around for a few years... but it's doing $1.6mm USA Dollars in transactions. 

Apparently, if you pass around money with a zero sum total, it registers those transactions and adds them into the total money spent.  Knowledgeable users of Second Life can write scripts that pass money back and forth all day and increase the total amount of money spent in the virtual world... with having a pure zero sum transaction.

Makes me wonder...  original article is here.

Social Networks as Fads?

Wired Magazine's September issue (9/2006) includes a reader "rant + rave" that says the following: "As a fad for the young, MySpace will fizzle out within two years, just as a new nightclub burns brightly with all the cool people until the mundanes discover it.  If old media wants to keep the young dazzled with its online clubs, it'll need a virtual velvet rope to keep out the unhip, including parents, teachers, and those over-the-hill 35 year-olds fishing for 18-year olds." (William McCarthy)

I agree partially with what William discusses above.  I like the MySpace vs. nightclub comparison. In the nightclub industry, you can only be "hot" for so long - it's a rule of thumb.  Owners of hot restaurants and nightclubs will generally close after they are the #1 club for the summer and go and open up somewhere else under a new name.  The reason for this is that the "elite" or "trendsetters" do not want to keep frequenting the same place year after year.  What will generally happen is that the "trendsetters" will find the place, party for a summer, then the name will spread to the masses and it'll become the mass place to go until that fizzles out.  Just think of Pangaea and Serafina here in New York... those were the hot-spots.

MySpace according to McCarthy "was" the hot-spot.  I like his analogy here.  The trendsetters are probably up in arms that 55+ million people have registered as well, so they are out scouting new social networks.  However, my question is, can you take 55+ million people away from Myspace as it's not the "hot club" anymore?  Probably not, but I do like his analogy.

Social Networking Rant in NYT

Theodora Stites has written a fantastic article labeled, Someone To Watch Over Me (on a Google Map) which touches upon a half dozen social networking companies who directly impact her life every day.  Sites that are realized in the article are:

• Myspace
• Friendster
• Dodgeball - good to see the site/service appear
• Facebook
• Match.com
• Nerve * not really part of the list
• Plazes
• Fark
• Geocaching

The most interesting part of the article focuses on why Theodora has multiple social networks.  She explains it well, and honestly, it's fascinating:

WHY, you ask, do I have to be a part of so many online communities? Isn't it hard to keep track? I need to belong to all of them because each one enables me to connect to people with different levels of social intimacy.

Don't know you but think I may want you to be part of my network? I'll contact you through Match.com or Nerve. Just met? I'll look you up on MySpace. Known each other for a while, but haven't been in touch recently? Friendster message. Friends with my friends and want to get to know you better? Dodgeball or MySpace. Good friends and want to connect more often? Dodgeball. Really good friends? Instant Message.

Anyone involved in the social media space or investment realm should take a look at this article.  It may be a bit slapstick or informal, but it does lay out some great thoughts into the social networking realm.

Tags:  social networking, myspace, friendster, fark, dodgeball, facebook, and NY Times

Virtual World Tennis

I bet you didn't think you'd be able to watch Wimbledon within Second Life, did you?  Ian Hughes has been developing a full Wimbledon environment within Second Life with the following:

• security gate is there to show you can detect things about peoples avatars
• RSS weather feed globe
• world tracking data for actual tennis matches
• The flying wimbledon towel. When anyone clicks the towel it act like a normal banner ad and directs them to the real wimbledon shop for the real towel
• advert watching posts
• and much more

Check out Ian's blog to learn more.

Second Life. tennis, content

Facebook Nears Deal With Major Holding Company

When we think social networking, most of us can name Myspace.com immediately, but if you've graduated from college in 2003 or less, you probably can also name TheFacebook.com, or their newer name, Facebook.com.

A major advertising holding company, IPG (Interpublic Group of Cos.) is nearing a deal to purchase a 0.5% stake in the organization.  IPG has 2 significant media agencies within:  Initiative Media Worldwide and Universal McCann.  R/GA is part of the holding company as well.  Not only will IPG media agencies purchase their media on Facebook.com, but ideally, and I personally think they should use the platform to mine the data... forecast trends and understand what college and high school kids are doing and WHY.  There is tons of data that they have... IPG can leverage this for their clients to provide valuable insights.

Denuo (Publicis) has hinted at M&A and investments in the media space but this would be an unexpected move by IPG who has been hurting financially lately.

Tags: Facebook, M&A, IPG, Social Networking, and community

Web 2.0 Directory

Remember Jerry and David's Guide To the World Wide Web?   We now know the company as a small little search engine/portal/media company called Yahoo!

I was looking for a bunch of Web 2.0 applications and came across eConsultant which lists over 900 differnet Web 2.0 apps.  Certainly worth a look.  You can access the site here. 

Metaverse Forecasts

The Metaverse Roadmap met this past weekend in San Francisco but I was unable to attend do to a few reasons.  A few of my friends made the event and said it was fantastic and there was some excellent break-out meetings that covered a broad range of topics.

Mark Wallace over at 3pointD.com put together a few forecasts of the Metaverse through 2010 (take each with a grain of salt):

• Government regulators will require real-world ID information from people wanting to create an account in online games.
• We’ll see a decline in business travel as a result of virtual world business applications.
• Current AOL users will discover Second Life; current Second Life users will leave Second Life.
• Anshe Chung will earn $1 million in Second Life.

For those of you who do not know of the Metaverse Roadmap, here is their mission statement from their website:

Taking its name from the immersive virtual world imagined by Neal Stephenson in his visionary novel, Snow Crash, the Metaverse Roadmap (MVR) is the first public ten-year forecast and visioning survey of 3D Web technologies, applications, markets, and potential social impacts. Areas of exploration include the convergence of Web applications with networked computer games and virtual worlds, the use of 3D creation and animation tools in virtual environments, digital mapping, artificial life, and the underlying trends in hardware, software, connectivity, business innovation and social adoption that will drive the transformation of the World Wide Web in the coming decade.

Tags:  Metaverse Roadmap, virtual world, and Web 2.0

The Web With A Face?

The web is finally coming alive.  It's not that this is new, but consumers are finally adopting this moreso in the past and we're seeing some great new startups emerge into the avatar & virtual world space. 

Meez is the latest startup that has landed funding ($4.3mm) and was recently in Forbes Magazine (March  28, 2006).  Sean Ryan, formerly CEO of Rhapsody is at the helm and is positioning Meez well wihtin the marketplace by striking some business development deals with major sports leagues and other brands.  The whole point of Meez is to make your 3D ID (identification).  The avatar can be customized pretty robustly to look like you, or whatever your mind conceptualizes.  It than integrates into Myspace, Live Journal, AIM, and coming soon...casual games.

This is the first service that I've heard of (I can be 100% mistaken) where an avatar that exists out of a game can be brought into.  This is fascinating - as gamers can now play multiple games with the same avatar (granted, they are participating in the Meez program - or they're standards setup within the avatar industry).

There are some competitors within the avatar industry - but not really a direct competitor to Meez.  IMVU has created an instant messenger that uses 3D avatars.  Comverse Technologies has created Klonies, which are avatars for the mobile world.  Sitepal....What's coming next?

These are exciting times within the virtual worlds and games industry.  Lines are blurring as to what a game is and what a virtual world is, in some cases.  Is Second Life a game?  It's a virtual world with a real economy.  There are games within Second Life - but I'd argue it's more of a world...  These avatars will help us bridge the gap between external and internal characteristics.

Tags:  Meez, LiveJournal, Sean Ryan, IMVU, Virtual Worlds, and avatar

Web 2.0 Matrix

Programmableweb.com has put together a fabulous matrix of web 2.0 mashups. 

http://www.programmableweb.com/matrix

Certainly worth checking out.

Tags: web 2.0, internet, mashup, cool

Two Interesting Startups

Two startups recently crossed my desk: ClaimID and Ether.  These both are extremely interesting in their ideas and I happen to like them for the fact that they solve problems and are monetizable.  Simple.

ClaimID is a website that allows you to "claim" your identification online.  There are billions of people in this world and how does one control their identity in the online space - it's nearly impossible.  By using ClaimID, you allow people to find you and your online postings (blogs, tags, photos, sites, etc) simply and efficiently.  Very good for folks to put on their resumes - so employers can find you easily online and weeds out the possibility of associating you with the wrong person.  As of today, the site isn't live yet - they are accepting folks to sign up for their beta program and they'll receive an invitation shortly.  My guess is that they can monetize ClaimID through a subscription model which is paid yearly.

Ether is a solid business idea.  Not all transactions are physical - some are verbal.  Think about all the lawyers and consultants (not limited to) that exist in this world who bill based on time.  Ether provides the payment infrastructure between both parties and allows for seamless flow of verbal transactions without worrying about being paid or collecting afterwards.  This is a very simple and straightforward idea, one of the reasons I really like this.  Ether will make its money based on a % of the transaction - estimated to be between 10-20% (I've heard 15%).

Technorati Tags: Web 2.0, Internet, web, ClaimID, Ether, startups

2006 Best of Web 2.0

I have been surfing the Internet trying to find which companies are emerging in Web 2.0 (a term that I may/may not subscribe to) and the following have made Vince Veneziani's hotlist at Design Technica.

• Flickr
• Vimeo
• Del.icio.us
• Digg
• Bloglines
• Netvibes
• Writeboard
• Google Maps
• Meebo
• amongst others...

I have to say that I'm a fan of Netvibes.com and their full Ajax implementation.  You do not even need an account... start using the start-page functionality right away.

What is Web 2.0?

The term Web 2.0 is proliferating through social groups faster than Google now checking undergraduate GPA's.  I thought it would be beneficial that I would post a (not "the") Web 2.0 definition from Wikipedia.  Please note that you can find the full definition here.

Web 2.0 is a term popularized by O'Reilly Media and MediaLive International as the name for a series of web development conferences that started in October 2004. It has since come to refer to what some people describe as a second phase of architecture and application development for the World Wide Web. Web 2.0 applications often use a combination of techniques devised in the late 1990s, including public web service APIs (dating from 1998), Ajax (1998), and web syndication (1997). They often allow for mass publishing (web-based social software). The term may include blogs and wikis. To some extent Web 2.0 has become a buzzword, incorporating whatever is newly popular on the Web (such as tags and podcasts). A consensus on its exact meaning has not yet been reached. - wikipedia.org

Major Press Day

Today was a major press day as I was featured as the spotlight interview on the release of Adotas.com.  The interview can be found here.  If you read the article, I dont know how much I look like Pete Sampras, but as a major tennis fan and coming from a tennis family, I highly respect it.  Also, IGA Partners was written up in Crains New York Business Journal [subscription required] and Clickz.com.  Lots of amazing press and a lot more to follow shortly.

I'll be back in NYC on Friday and will be back to posting regularly then.  Hang tight.  (currently in Los Angeles and Santa Monica)

CES Roundup: Microsoft Xbox 360

Just finished watching the XBOX 360 portion of the Microsoft keynote speech at CES 2006. Even with being within the industry (IGA Partners), the numbers are startling. Microsoft predicts that 4.5-5.5 million Xbox 360s will be sold by June 2006. Currently, they have launched the game console within 30 different countries, with the first one being the USA on November 28, 2005. Xbox Live Marketplace is the area of which you can buy game assets, and within the first 90 days since launch, there have been over 4 million downloads. Epic Records and film studios have launched campaigns to release assets into the Xbox Live Marketplace. One of the larger advertising deals cut into Xbox Live interface is that of Paramount’s Mission Impossible III (MI:3) which is a movie trailer promotion. In terms of internet connectivity, 10% of the initial Xbox’s were connected online where as over 50% of the Xbox 360s are being connected. On average, 4 games are being sold per Xbox 360 with over 2 peripherals per console. Numbers are doubled from the original Xbox. Great job Microsoft - looking forward to the future.

Women Play Games?

So the headline has two meanings, but for this particular posting and the meaning behind this site, we'll stick to 'gaming' as in, video games.  If you were to guess the percentage of women gamers in the marketplace, what would you guess?  We always are hearing about the elusive male - 18-34 year old, but why not women?

According to a recent study by Peter D. Hart Research Associates for the Entertainment Software Association, 43% of all video-game players are female.  Online games, in which players interact with other gamers around the world skew a percentage point higher, 44%.

Another interesting fact to the study is that there are more women over the age of 18 in the game-playing population (28%) than there are boys ages 6-17 (21 percent).  In 2004, two of the top three computer games, The Sims 2 (No. 1) and World of Warcraft (No. 3) were ones that have a strong female following.

So yes, we can certainly reach women through video games - and this little posting didn't touch upon casual games, whereas some casual games can be as high as 60-80% female dominated.

MediaWeek - Kids supplement - Total engagement

Looks like MediaWeek is following AdWeek's story on in-game advertising.  Today, IGA Partners (of which I'm a co-founder) appeared in a MediaWeek feature article on in-game advertising.  This is not the first article we've appeared in, but one of many articles IGA Partners will be appearing in across the globe moving forward as we're picking up some serious momentum.  Some of you may remember the CBS article that IGA Partners appeared in by William Vidka.

A solid quote from the article:  "What we are effectively doing is becoming media owners in the games space," says Ed Bartlett, global VP of publishing for in-game advertising pioneer IGA Partners. With most popular games focusing on real-world scenarios such as sports or, er, street violence, ad slots are simply built into games in their real-life context, inevitably with particular emphasis on outdoor spots. Though the PS2 can not currently be served with ads in real time, players' exposure to ads embedded in games can still be tracked, while the Xbox allows ads to be both tracked and served. With the imminent launch of the Xbox 360 and next year's PlayStation3, both the market's cutting-edge consoles will theoretically be fair game for dynamic ads. "We can plan geographically, we can micro-target, we can do all kinds of things," says Bartlett.

Activision and Nielsen Entertainment Release Results of Pioneering Research on In-Game Advertising

Our friends over at Activision and Nielsen Entertainment have released the results of a study that show that if in-game advertising is done correctly, it not only raises awareness and recall, but also pervasiveness, which contributes to driving brand awareness as well.

Research results also found that, contrary to the assumption that highly pervasive ads would detract from the game play and frustrate gamers, a majority of study participants said that when the product is relevant to the game, advertising enhances the experience. Underscoring relevance, the study revealed that the vast majority of gamers who recalled a product in a game felt it fit the game they were playing. Moreover, a much higher percentage of gamers changed their opinion of the product positively versus negatively after having played the game.

Digital Entertainment Media Expo (DEMXPO) Recap

Well, 72 hours after arriving in Los Angeles, the Digital Entertainment Media Expo (www.demxpo.com) is now over for 2005.  IGA Partners had a fabulous show - we were the gaming sponsor and met with everyone from the game publishers/developers to brands and agencies who were present.  Was great to meet new people and hear new business models!

As for last night, we had an 'IGA Family' dinner with our new hire, Tim Steudler as well as had Brooke Wagner (VitroRobertson) and long time friend, Patrick Yee (Global Gaming League) out with us.  Was a fabulous time and I loved hearing their insight to the gaming and advertising industries.

DEMXPO (Digital Entertainment Media Expo)

I've been pretty silent over the past few days as I've been out in Los Angeles, California at the DEMXPO.  IGA Partners is one of the sponsors of the events and we've been leading Gaming 101 presentations as well, as speaking on various panels about video games, advertising and the marriage: in-game advertising and media placement.

So far, it's been a pretty solid show.  I have managed to sneak out of our meeting room and sat in on discussions about the music industry and the future of digital marketing and really enjoyed the panel by colleague Robert Tercek, formerly of MForma and Sony. I also ran into Rafat Ali of PaidContent.org and its always enlightening running into him - as he seems to know more about my company than I do!  Never a bad thing!

During Tercek's presentation, he alluded to a few things including:

Americans spend more on entertainment than gasoline, household furnishings, and clothing combined.

Mobile phones sold 780 million units in 2005 whereas mp3 players sold 75 million

1 billion music tracks per MONTH are exchanged illegally

subscription content shows slow growth, however, much more stable (non volatile) over the long run.  mirrors cable television/premium channel

Lots of great things to report.  More tomorrow as both Christian-Alexander Vry and myself are sitting on 2 different gaming panels. 

Don't Flood Gamers With Ads

Colleague Mike Shields over at MediaWeek wrote an article today labeled, "Report:  Don't Flood Gamers with Ads."  This report was based on the information I blogged about last week regarding the mediaedge:CIA study on in-game advertising. 

The article quoted  Fran Kennish, director of strategic planning at Mediaedge:cia and David Tokheim, IGN’s vp of marketing.  Both advocated the following:  “Every game is unique and needs to be treated uniquely,” he [Tokheim] said. “It’s never going to be like sliding in a 15-second spot before Desperate Housewives.”

http://www.mediaweek.com/mw/news/interactive/article_display.jsp?vnu_content_id=1001570637

In-Game Advertising Studies

With the launch of the XBOX 360 and the hot in-game advertising marketplace, our friends over at mediaedge:CIA have released a study that shows the effectiveness of in-game advertising and how it is actually enhancing games..... if done well.

http://www.clickz.com/news/article.php/3565891

"It's tough for advertisers who are thinking of ads as interruptive, like a :30 spot," Brian Aucoin, media supervisor at MEC Interaction, told ClickZ News. "You can't disrupt the flow of a game; you want it to complement the gaming experience."

I'll be following up this post over the weekend with tips, insights, and techniques on how to create a very contextual in-game advertising campaign, one that does not alienate gamers from their entertainment.... which is #1 priority...contextual relevance.

The Next Generation...

I think it is only fitting tonight that I write a blog about the next generation of consoles hitting the shelves starting tomorrow. If you have been living under a rock or choose to ignore pop-culture, the Microsoft XBOX 360 is hitting the shelves at the electronics store near you.

The next generation of consoles is going to push the limits of connectivity and collaboration.  Whilst the 360 has 3 processors at 3.2ghz each, the real next generation experience happens with its connection with the XBOX Live network – allowing for a formerly solitude experience to transition into a communal gaming experience.

As someone in the gaming and advertising industry, I look at this launch as both good and bad. Whilst most brands we talk to want to be on the XBOX 360, the actual reach of the machine is just not there. With only 1 million units expected to be sold by December 31, 2005, the reach for any potential advertiser who is looking for a broad campaign will disappoint. However, you just can’t ignore the coolness factor.

XBOX has previously sold 13.5 million units in the

USA

since 2001 (as of October 2005). Just over 10% of XBOX players currently are playing online.  As of July 2005, they hit the 2,000,000 XBOX Live registration mark.  Microsoft needs its XBOX users to utilize the Live platform (which enables online game play and other collaborative elements) in order to really win the console war. By having users plug-in to the Live platform, Microsoft now has the ability to track users, download/upload data, patches, as well, as connect with users in real-time. There are a slew of other opportunities that Microsoft has (VOIP, Instant Messaging, etc) but these are the crucial ones.

I’m really looking forward to the XBOX 360. Don’t know when I’ll get one – they are sold out in each store I have checked, but I’m sure that I’ll find a way to get one relatively quickly. Excited for the next generation, this will surely be a breakthrough in console development and the way games are designed.

eROI November Report

I've been involved in the Interactive marketplace since inception, early days at i33, iComputerServices, CommerceOne, AppNet, then Conducive, adMarketplace, FortuneCity.com (FCTY), and then Ad Intelligence LLC.  Lots of amazing things happening with the legal targeting of advertisements and media across the world wide web even since the early days of Ad Maximizer by i33.

Today, I read a report on an overlooked area of Interactive, the email sector.  eROI (http://www.eroi.com) released a report on the 14th of November that if you are sending out email newsletters to more than 500 folks, the best days of the week to send are Sundays and Fridays, respectively.  On Sundays, 30.8% open rates compared to Fridays 27.0%, and 7.2% Click-Thru-Rates (CTR) on Sunday compared iwth 5.3% on Fridays.  Impressive numbers!  Much higher compared to any other day of the week. 

Check out http://www.eroi.com for even more findings.

Monthly Trends and Stats Weekend

About once per month, I immerse myself in a full 2 days of re-reading all of the blogs, research, reports, and interviews that I accumulate over the month.  This month, it took place at the Soy Luck Club in the West Village of NYC, as well, as a new found coffee place, thanks to Mr. Andrew Sispoidis, Jacks (West Village, NYC). 

I have conversed with Joseph Jaffe, the famous author of, "Life After the 30 Second Spot," as well, as immersed myself with documentation from Malcom Gladwell, Josh Rubin, Steve Jobs, Steve Ballmer, the folks at Jupiter Research, Forrestor, Nielsen, Fishtank Brand Advertising, and many others.  Coming out of this weekend, I am seeing that collaboration is a major aspect to any new technology/consumer play within the marketplace moving forward and the future of games is multi-platform, something that I've been proactive about for a long time.

Lots of the research and reports I came across are different variations of last month's news, as well, as duplicated postings from blogs - but all in all, it's been a great 48 hours.  I'm starting to favor Joseph Jaffe's GetTheJuice located at http://www.getthejuice.com.  He's putting some good ideas down on his blog - certainly check it out.

Interesting Rumors...

Rafat Ali over at PaidContent.org had some interesting rumors to post about IGA Partners this afternoon....

http://www.paidcontent.org/pc/arch/2005_11_17.shtml#052455

Volvo Advergame - AAA Advergame

I'm sure you've heard of the new Volvo advergame for XBOX which has been featured in the NY Times.  Volvo Drive For Life is being released at tradeshows and at car dealerships for prospective Volvo buyers - however, only 100,000 copies are being made.

This game solidifies my thoughts on the AAA-Advergame, or, a blockbuster game developed around a particular brand.  We have seen Volvo hint at such a game in the making with their 'video game car commercials' which depict the S40 in a video game like situation.  Are there going to be more AAA advergames?  Yes, of course.  Why?  The brands who could afford to pay for a AAA-Advergame (this game was no less than six figures or possibly into the sevens, I'd imagine) also generally have POP distribution....it's hard to download a AAA-Advergame offline currently due to bandwidth constraints, but with retail presence, you can give them away easily.

Looks like a new arena in the advergame sector is coming out...looking forward to seeing the next game.

IGA Partners: Gaming 101

Not sure if any of you are familiar with the company I founded almost 2 years ago (at least it's a mutation of) called IGA Partners, but we have an article by a wonderful lady, Tessa Wegert posted on ClickZ.com.  This is our first time on ClickZ.com in over 6 months as we have been laying low on press, but I think IGA is going to be announcing a few things soon.

Gaming 101 is what the article is focused on and it's something very important to the video game and advertising industry.  IGA Partners, which is the leader in in-game advertising, has taken it upon themselves, or should I say, ourselves, to educate the marketplace on how to properly run in-game campaigns that range from dynamic to static and they include product placement, plot integration and situation placement (as well, as dynamic in-game advertising).  Since in-game advertising is so new to advertising agencies and brands, we are here to lead them through the process, show the obstacles, and who the overall players are, even if they are our competitors.

All in all, the Gaming 101's have been going fantastic.  I, myself, have been the main "professor" of the Gaming 101's at various advertising agencies and brands globally and have witnessed some real minds change about video games.  One amazing thing to see as well is that the younger folks at agencies and brands absolutely stand out amongst their superiors (tend to be older) and understand the medium tremendously.  If we can just wait until those younger folks move through the ranks, we'll see some major adoption of in-game advertising and that is a very good thing for IGA Partners.