With Sparkplay Media's first game, Earth Eternal, going into beta, we got the chance to sit down with the CEO of the company, Matt Mihaly, and pick his mind on a variety of things related to setting up shop in the free to play genre.

Matt's no stranger to the massively multiplayer space, holding a strong background as the CEO and founder of Iron Realms Entertainment, a company dedicated to creating multi-user dungeons (MUDs) including Imperian, Aetola, Achaea, and Lusternia. If that wasn't enough, Achaea was one of the first games to introduce the sales of virtual goods, making him one of the pioneers of the base that free-to-play games now stand on.

So what's his thought process behind Earth Eternal? What are some of the things we can expect from the MMO that's sporting over 22 races? Hit the continue reading link, and find out!

How have the launches of FusionFall and Free Realms affected Earth Eternal? Have you changed your development or goals in any way because of the success of those two games, or have you stayed the course and continued to build things your way, disregarding those two games?

Not really, no. Games like Runescape and Habbo have had more influence on our plans than either of those two games, simply because they're so much bigger. FusionFall and Free Realms have gotten a lot of press in the last year, but neither of them have achieved the level of success that games like Runescape and Habbo have.

Actually, nobody really knows how Free Realms is doing outside of SOE. Three million registrations doesn't tell you much about how many active players they have as you don't know how quickly players are churning out of the experience. With the massive dollars they spent on marketing too, it'd be surprising if they couldn't get a few million registrations. The challenge for them (and everyone else in this space, including us) is to convert that fleeting attention into long-term, loyal players.

"We're more in the vein of a classic fantasy MMO than a collection of minigames."

How will Earth Eternal separate itself from the growing free-to-play genre in America? What will make this game stand out?

We're a different kind of experience from FusionFall or Free Realms. We're more in the vein of a classic fantasy MMO than a collection of minigames. I think where we stand out is by offering the best browser-based fantasy MMO out there. We've made the decision to have no humans, elves, or dwarves (or gnomes, hobbits, or anything else too close to human), preferring instead to offer everything from humanoid lizards and falcons to the Clockwork and Yeti. We're definitely fantasy but we want to stay away from the pack, almost all of whom have the humans/elves/dwarves thing going on. We've also got an enormous number of races for players (unlike the two games you mentioned) – 22 at launch.

Considering all of Earth Eternal's development, what part of the game are you the most proud of? What is that one feature you can't wait to show off?

The number one thing I'm proud of is how much our team has managed to do on relatively little funding for an open world 3D MMO (about five million dollars.) As far as game features go the biggest feature I'm looking forward to showing off is our Groves system, which will be introduced at final launch, a few months after we go into open beta.

Thanks so much for your time, Matt!

According to this MSNBC article, there are no less than 200 youth-oriented virtual worlds and MMOs either in development or on the market. Some of these titles even boast account numbers that rival Facebook and MySpace as analysts estimate 30M users in Club Penguin, 52M users in Neopets, and 90M in Habbo.

Is this really surprising though? Probably not when you consider that kids today aren't totally different in this generation than previous generations. 'Tweens have always liked to socialize, play, and simply "hang out." The difference nowadays is that parents tend to have looser restrictions and the kids can accomplish most of the things they like to do without even leaving a computer chair. The rules and tools have changed.

The article also talks about a 89/10/1 rule that most F2P/RMT games aim for. This rule assumes that 89% of people will play your game for free, 10% will pay the minimum, and 1% will spend lots of money. Apply that rule to the recent announcements that both Free Realms and Runes of Magic have surpassed 1M users. If the rule applies, it means 100,000 people are paying the basic fees (~$5/month) and 10,000 are spending oodles on extras ($15+/month). That's roughly $650,000 per month, which isn't half bad depending on your development costs.

Pew Research has just published results of a study into American teens focusing on video games and civics, entitled (oddly enough) Teens, Video Games and Civics. Almost all teens game, but few are into MMOGs and virtual environments.

Overall, 97% of teens (99% of boys, and 94% of girls) were gamers, with 80% of teens generally playing five or more different genres of games. Racing, Puzzle and Sports games topped the list (with 74%, 72% and 68% respectively), while MMOGs like World of Warcraft, et al came in at second-last place with just 21% and virtual environments (Second Life, Habbo Hotel, and so) in last place with only 10%.

The five most popular games among teens were Guitar Hero, Halo 3, Madden NFL, Solitaire, and Dance Dance Revolution ranging in ratings from E for Everyone to M (Mature).

Where is it all going? With an MMOG you already know: Content updates, free and paid expansions, and so forth. A broadening and sometimes also a deepening of the game experience.

Virtual environments tend to be a bit hazier, largely supported by microtransactions they may include game-elements (like Entropia Universe), sci-fantasy settings (like the upcoming Blue Mars), specific celebrity events (Habbo) or merchandise and marketing-focused experiences (Virtual MTV, Barbie Girls Online and more).

In a very real sense the virtual environments industry is largely about focus. Targeting a market, wooing a demographic, and showing them where you are going to take them in the coming days.

Interesting, then, that the world's best-known virtual environment, Linden Lab's Second Life lacks the answers to fundamental questions, the answers to which directly impact every user and organization who participates (or who might participate in future). In fact, hardly anyone is asking those questions. Now isn't that peculiar?

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	Are you a part of the most widely-known collaborative virtual environment or keeping a close eye on it? Massively's Second Life coverage keeps you in the loop.

One hundred million. 100 million. 100,000,000. No matter how you look at it, it's an extraordinarily large number. It's the number of colors most women are capable of seeing. It's the number of websites that existed in 2006. It's a song by the rapper Birdman. It's also, rather incidentally, the number of avatars created to date in the simple and spectacularly successful Habbo Hotel.

Naturally, that doesn't correlate to 100 million users (Habbo usually clocks in at about 8 million a month), but it's still a testament to the power of a simple virtual world aimed at an extremely active demographic. The lucky sap who created the actual 100 millionth avatar was awarded one of those fancy new Macbook Airs, as well as a slew of in-game goodies like a specially designed room, in-game currency, and rare items. Here's hoping they see 100 million more!

And not just likenesses. Metaverse developer Millions of Us intends to market likenesses, hair-styles, catchphrases, dance moves, signature moves, clothing lines, furniture collections -- you name it -- based on well-known celebs all under the banner business name of Virtual Greats. These appearances and digital accessories would be sold in dozens of virtual worlds, though you'll probably see them in Gaia Online, Habbo and Second Life first.

Deals have already been done with Justin Timberlake, Elvis Presley Enterprises, Snoop Dogg, Paris Hilton, Raven Symone, Marvel (for The Incredible Hulk), and Tila Tequila, and more are in the works.

One dollar per user per month may not sound like a huge revenue for any game, but when you start thinking in the terms of the user base of games like Habbo Hotel, Club Penguin and RuneScape you start to realize how much a dollar is really worth.

Lightspeed, a venture capital firm, recently did a few calculations to come up with the figures of how much revenue is generated by a single user in today's most successful free-to-play, microtransaction supported MMOs. What they came up with is a pretty interesting look at how much a "successful" MMO will make. For example, Habbo Hotel pulls in around $1.30 on average for each of their active users per month, while RuneScape pulls in 84 cents per active user per month.

The one figure that stood out from the pack was Second Life, which pulled in 9 dollars per user per month thanks to things like land ownership and the premium subscription that land owners have to buy to be able to own property. Even with Second Life in the mix, it's interesting to see that these types of MMOs don't make much per user, yet still can pull in great amounts of revenue by entertaining huge player bases.

[Via Kotaku]

Market research and consulting firm Strategy Analytics has forecasted a surge in virtual world registrations over roughly the next decade. The firm's study is titled 'Market Forecasts for Virtual World Experiences - from Habbo Hotel to Second Life and Beyond - 2008 to 2017.' It posits that roughly 22 percent of global broadband users will participate in one or more virtual worlds on some level. The end result will be a global virtual world market with one billion registrants. That throng of virtual world residents will provide an estimated eight billion USD in service opportunities for companies that learn how to do business effectively in these spaces.

Strategy Analytics has been keeping a close eye on virtual worlds of late. The firm released another report on the growing market in May, as well as a presentation seemingly geared towards fledgling companies wishing to capitalize on what might seem to them an abstract, if not bizarre, new market. Adrian Bowles, Executive Director of Virtual World Strategies at Strategy Analytics, writes, "For this generation it is as natural to interact with a friend represented by a flying cat as it is for real world senior citizens to gather in a town center and reminisce," for his 'Finding Business Value in Virtual Worlds' presentation. The Strategy Analytics next-decade projections are specifically for non-gaming virtual worlds. Were they to include the massively multiplayer online market, the global figures would likely be drastically higher.

Kishore Swaminathan, chief scientist for IT consulting firm Accenture is skeptical about the long-term success of non-game virtual worlds that lack interoperability. Swaminathan believes that interoperability of accounts, assets and a common currency are key to the success of virtual worlds.

Swaminathan draws parallels between closed virtual worlds like Habbo Hotel and Second Life with closed services such as Compuserve -- although seems to neglect that services such as Compuserve were established in a time where interoperability pre-existed.

Nevertheless, despite something of a heady rush of corporations towards closed worlds, Swaminathan sees them outgrowing those worlds very quickly, and looking towards more open and interoperable systems. 'I don't think, two years from now, there will be a Second Life...', he said.

[via Virtual Worlds News]

The Silicon Alley Insider has the latest iteration of its "World's Most Valuable Digital Startups", a list of 25 privately-held companies with products or services on the Web. They say 'iterative', because they plan to continually update the list as market values change.

Companies of note on this list are Webkinz, the purveyors of virtual pets, valued at an estimated $2 billion dollars; Habbo, makers of Habbo Hotel, valued at $1.25 billion; and Linden Lab, the hosts of Second Life, valued at $1.1 billion dollars. If you're wondering about how they've come up with these valuation numbers, they explain their methodology, which essentially consists of four main components: implied valuations in recent financing, financial performance, market share and market size, and growth rate.

The Webkinz model is well-supported by now; it's essentially Beanie Babies in digital. Habbo Hotel is doing well enough to almost become a household name. Second Life gets the lion's share of public eyes on it by being the target of everyone's assumptions. Honestly, we're surprised that all three of these companies are still privately owned. Any bets on how much longer that will last?

In Bad News Week, we take an irregular peek at some of the most mixed up and counterfactual reporting that the mainstream media performs on virtual worlds and MMOs, and lay it out for your interest and entertainment. The UK Mirror's Jon Clements reports "Police probe Second Life over virtual crime wave" from which you might reasonably infer that there is a crime wave going on in Second Life, and that you're about to read about it.

Well, you'd essentially be wrong. Let's take a look and what the Mirror had to say.

Take an advertising/marketing operation and mix it with a virtual world, and what do you get? No, not There -- well, maybe them, but that's not who we mean. The answer is Riplounge.

Browser-based and 2.5D (2D sprites in a pseudo 3D environment), Riplounge is for ... umm. Well, actually we're not quite sure. We think it is aimed largely at the wannabe-hip, under-25, knows-about-the-same-about-computers-as-your-granny demographic. Or maybe the I-wish-I-was-15-again demographic.

Tuesday afternoon, Michael Acton Smith, CEO of Mind Candy, presented attendees at the GDC's Worlds in Motion summit with an interesting look at the confluence between real goods and virtual worlds. For some background on where Smith is coming from, Mind Candy "creates games and puzzles that span multiple media.... [they] use all forms of technology to tell stories and interact with... [their] audiences." They run Perplex City, an alternate reality game that uses clues puzzles in the real world combined with web-based resources to create a unique type of gameplay. Their upcoming game Moshi Monsters is an adoptable pet game geared towards kids. Smith says it's a "new type of virtual pet experience." The pets will be very alive with their own emotions (driven by a behavior engine which will cause your pet to act different ways depending on how you treat it) that will be reflected in the pet's animations. The game will also incorporate a number of social tools, so both you and your pet monster can hang out with friends. And, of course, there will be toys, oh glorious toys. (Some already available, though the game itself is still in beta and closed to the public.)

Sulka Haro, lead designer on the wildly popular Habbo Hotel virtual world, yesterday gave the Worlds in Motion summit audience an in-depth half-hour rundown on the Habbo phenomenon. At its core, the Sulake company project is a meeting space for teens - a place to hang out and be someone else for a few hours. The fact that the company can boast millions and millions of unique users worldwide, though, speaks to something many have grasped for and few have succeeded at: a virtual world where people feel truly comfortable.

Haro offered up a peak behind the curtain, at the origins of Habbo as the four room 'Hotel Goldfish'. He discusses the successes they've had in markets abroad, their surprise at the game's adoption by teens, and the numerous ways they allow players to acquire in-game currency. He also notes that Habbo is a world-record setting title in at least one way: they've probably sold the most virtual reindeer poop ever in the history of man.

Read on for a dissertation on a poop-selling, smashing success story.