Tag: Dale Glass

Guest Editorial: Dale Glass Reports from the VR Days Conference and Exhibition in Amsterdam

I was delighted to receive the following report from Dale Glass, who attended the VR Days Europe 2019 conference and exhibition held in Amsterdam from Nov. 13th to 15th, 2019. Here is Dale’s report in full:

VR Days is a VR convention and exhibition that took place in Amsterdam in November 13-15. I only had an exhibition ticket (full tickets are very expensive), so I can’t say anything about the talks.

First, a disclaimer: I didn’t go to VR Days intending to write a report on it, so it’s very possible that I got something wrong somewhere. I only started taking notes once I had enough thoughts brewing in my head that I realized I might as well write them on paper. I didn’t visit every single stand, though I did visit most of them, so it’s very much possible that I missed something very cool. Also, I’m not a reporter, nor an expert in all things VR.

With that out of the way, here’s my one word description of what I saw at VR Days: “Underwhelming”. I think now I am starting to see what John Carmack meant when he said he was “not satisfied with the pace of progress”. While I saw a fair amount of things that were interesting to me personally, there wasn’t a lot that made me really excited about the future. A fair amount of the exhibition seemed to be showing things from years ago, proofs of concept that may not go anywhere, and products in search of a market. There also were some very well done things for very specific corporate purposes that will likely take a long time to percolate into the consumer realm.

The exhibition wasn’t very lage and was rather lightly attended, apparently mostly by people working in the same industry. Most booths weren’t very busy, so I didn’t spend a lot of time in line. Attendance by enthusiasts without a business plan appeared to be very scarce. I managed to disappoint a record amount of people in two days. Conversations usually followed this formula:

Booth staffer: …and that’s our product made for corporate audiences that we sell for a lot of money. By the way, which company do you work for?

Me: We don’t do anything VR related, this is just a hobby for me.

Booth staffer: (disappointed) Oh.

An odd thing was the lack of polish. It seems the hardware manufacturers need to hire better software people, because the graphics tended towards being extremely basic, and in one case there was no sound where there were lots of reasons to have it. That’s not a huge deal overall, but if you’re going to battle hordes of zombies, being able to hear them behind your back would add a lot to the immersion. I’m not asking for AAA games here, but it’s odd that one of the best looking and most polished things was the app for VR meetings.

The more concerning issue is the lack of much for a consumer to look forward to. Judging by what was going on at this conference, VR appears to have retreated back into corporate space, and most good demos had a premise of “suppose you have a factory”, “suppose you have a technician in the field”, or “here’s a very expensive lens or laser scanner”.

The bits most appealing to a consumer were the arcade games, Pimax (which are releasing an updated version of the “8K” headset), and the amount of hand and eye tracking demos which suggest there’s a lot of work being done in the area and that something is going to percolate down eventually, but it’ll probably take a while. Hand tracking was done either through specialized headsets with a lot of cameras, or special gloves. Eye tracking was very focused on medical and research applications.

Then, it just might not be a conference with the right focus to interest consumers in the first place. I’ve not attended any other VR focused conferences, so I can’t say how it compares. Even if I say it’s a tad underwhelming it was still very enjoyable. I got to meet online friends, to talk to interesting people, to play with some very expensive hardware, and to see what the industry is working on. Overall, my time and money was very well spent.

Booth reviews

Tobii pro

They make eye tracking hardware and focus on things like consumer research, for telling where people look while walking through a supermarket, for instance. Not all their work is VR related, they have transparent glasses that just have an iris tracker as one of the options for example.

VR for rehab

They use VR and a vest with arm trackers to assist in rehabilitation. Not being a doctor, I can’t say how useful this is, but VR in combination with the right tracking would seem to have good potential in helping people learn what movements they need to make, making as many corrections as needed, and tracking everything in great detail, while the patient is in the comfort of their own home.

KOC University

I tried a demo that was supposed to be a psychosis simulator. This failed to work. To be fair, it wasn’t part of their plan to showcase it (I noticed it on a pamphlet and asked about it). We did have an interesting conversation, though. I wondered why see-through AR glasses like Magic Leap are nowhere to be seen at VR Days, even at booths that have “AR” in the description. The answer I got is that they’re too expensive, don’t work in bright light, and that devices like the Quest probably made them much less relevant.

Sensiks

You sit in a sound-dampening booth wearing a headset, and watch a 360 video, while heaters and a scent releasing system provide some ambiance to simulate the wonders of Mother Nature. According to the rep, “it has many purposes” and “it’s a medium”. I personally think it’s a solution in search of a problem. There can’t be that much of a market for this kind of thing. It might find a home in a few spas, though.

Timmersive

They had prototypes of simple arcade games – submarine periscope simulator, pinball simulator, and so on. The pinball’s VR part was very good (might have been Pinball FX2 VR). The physical prop worked mostly fine though sometimes it seemed to miss key presses. The periscope prop and associated VR game was very much a proof of concept and reminescent of 80s soviet arcade machines due to the extreme simplicity of the gameplay. Overall, not bad and it has potential, but need a lot of polish still.

NLR

They had a 3D printed helicopter cabin, and optical hand tracking that’s precise enough that it can tell what you’re pressing without needing any functional hardware in the cockpit. That is very impressive and I think has a lot of potential – it means anybody with access to a 3D printer could easily make their own props for whatever function happens to be needed, and then interact with a physical object while in VR. The switches I pressed were clicky though, so they could have been connected to something, but the hand tracking looked good nevertheless.

VRTL

They offer courses in VR content creation. Hard to say much about that without trying it myself.

Varjo

Something related to photogrammetry, optical hand tracking and eye tracking. The booth looked very popular, but unfortunately I didn’t make it in.

Artsteps

Virtual museum builder. You build some walls, put paintings on them, and people can walk around. It’s so boring that I wouldn’t download such a thing even if it was free. It also doesn’t appear to offer anything over something like Sansar or High Fidelity. It might have something of a market at schools or museums, but there’s little excitement here for a consumer.

Another World

A huge booth was dedicated to a VR arena in Moscow. They say the installation can’t be replicated at a convention so all it’s doing there is to tell you there’s a very cool thing in Russia, and that they’re planning to expand.

Manus VR

Glove based hand tracking. Quite good performance. They have a demo where you have to assemble an engine by picking up parts and placing them in the right spots. Not consumer level tech, but it seems very promising. I enjoyed the experience and can’t wait for this kind of thing to make it into the consumer realm.

IMEC Netherlands

They have an EEG integrated into a headset as well as wearable watches to gather the heartbeat rate. They mentioned a possible applicability to children, but the current EEG consists of a bunch of hard and rather pointy electrodes I doubt children would be very happy to wear. They also said there’s nothing that can be easily bought at present.

They were having trouble with performing a demo because making Bluetooth connections was difficult with all the interference at the convention, but I got to test their EEG headset after a bit of trying. I measured a 0.75 in “valence” and -0.81 in “arousal”, which if I understood their descriptive text correctly means that I was enjoying myself a lot, but struggling to stay awake. I would definitely disagree with the later, since I got plenty of sleep, had some coffee, and it was just about noon at that point.

VR Medics

Another headset with an EEG, this time a far more comfortable looking one. This one has only flat contact electrodes, so it likely has more trouble making good contact. No demo, unfortunately.

Besides the EEG, they also have an eye tracker and use a custom Daydream headset. Given that Daydream was just discontinued by Google, it would seem they will need to retool a bit.

Somnium Space

Virtual world that feels rather similar to Second Life in that it’s a single world subdivided into parcels of land and overall functions in a similar manner. They have an external editor, an experimental Quest client that worked with a good framerate and used the same content with a lower level of detail, and insist the blockchain is very important to the whole deal. Figuring out how good it is in practice and the pros and cons would take a lot longer than a short test at a convention, but it seems functional, promising and well thought out.

AMA

They have single eye head mounted displays, as in a tiny monitor in front of one eye that covers part of your vision. This is a 100% commercial type project, where the glasses have a forward pointed camera that can transmit video and images to the home base, and they can assist in accomplishing some task, like fixing or replacing something. Seems useful for some applications, but there’s no VR at all, all the tech was available well before the Oculus Rift, and there’s nothing interesting to consumers.

Birdly

Birdly VR – The Ultimate Dream of Flying from Giant Screen Films on Vimeo.

A flying/swimming simulator where you have to lie on a mechanical contraption and move your arms to control the movement. It reminded me a bit of the racing segment of the Lawnmower Man movie. Quite fun, but very narrow purpose. It could work very nicely in an arcade, but the current incarnation isn’t the most comfortable. Also apparently this has been around for a few years.

Steinberg Media Technologies

Cubase + VR. You build a virtual environment then place sounds in it. Intended to assist in the production of movies and games. I’m no audio expert so I can’t tell how good this is, but it seemed cool and useful to me. If one is going to work on spatial audio, doing it in a 3D VR space seems to make a lot of sense, and probably makes the process a lot easier.

Vrgineers

Optical hand tracking. It worked so-so (they complained of interference from other stands), but I would say it’s an excellent start. The demo was a VR house where you can pick up some of the objects and move them around.

Cyberith Virtualizer

This one was quite the experience. The device being shown was the Cyberith Virtualizer Elite 2. It is made of a tilted, slippery platform and a ring to restrain the body. It’s used with slippery shoe covers, or one could just use the device wearing only socks. Climbing into the device has to be done very carefully, as it’s very slippery. The inclination is adjusted for each person. My personal impression once I was inside is that it feels like walking uphill while dragging along a bag tied with a rope to your waist. It didn’t feel very natural and turning in it was a bit odd. Then, this is definitely the sort of thing that you have to adjust just right and get used to, so it’s very possible that with more adjustment and practice I could have had better results.

The demo was a kind of safety demonstration where you are alone in a warehouse where something catches on fire, and need to put it out or just to get out in time. The graphics were very basic, but the scenario demonstrated the intended usage pretty well. Certainly, if you can escape a danger while having to drag a considerable weight around, doing it for real afterwards will be a breeze.

One significant upside is that it’s recognized as a controller by Steam, so supporting it should be quite easy. Unfortunately they didn’t have Skyrim at the expo to see how and if it works out of the box. That is really a pity, as although I understand it’s not a consumer oriented device I’ve long wanted to try an open world game with a VR treadmill.

Overall it’s very much an enterprise type of thing. The device is big, expensive, and takes getting used to. It probably gets better with time, but it doesn’t really feel natural at all, so it’s clear VR locomotion still has a very long way to go. It could have some use for arcade setups, but based on my experience environments where one can walk freely are far more comfortable even if the space where one can move is limited.

Vicon VR Arcade

One of the highlights of the convention. Definitely not a home type of installation, as it relied on dozens of cameras, a large space and wearing a backpack computer. But it tracks multiple people very well, they have prop weapons, and overall it works great. First I tried a demo where you just walk around and try different weapons and avatars. Moving in it feels a bit off, but isn’t bad at all.The props work great.

Then I tried the zombie game, where a team of 3 people fights against hordes of zombies. This was great, except the game wasn’t really polished and for some reason had no sound. But fortunately the software isn’t really important here. The big deal here is that they seem to have the hardware figured out very well. The tracking is pretty much flawless, and the gear is easy and quick to put on. Just pair it with a better game, and it’s going to be awesome!

Pimax

Pimax booth at VR Days (from their website)

The Pimax booth was a very popular one. I got to try a headset early on, but unfortunately it seems to have been the old “8K” model, and I didn’t get to try the newer version, as by that time they started giving people scheduled demos, and the list had grown to many hours long.

Regadless, I’m very glad that they’re around and still pushing forward. IMO headset resolution still needs improving, and Pimax appear to be at the forefront of that effort.

Plastic SCM

Source control for artists and VR. As far as I could gather the “VR” part is just that it’s made with game development in mind.

Actronika

They have a vest. “What does it do?,” I asked. “It vibrates” was the rather frank answer. The demo simulates a rain effect and there’s also a demo of burning alive in a broken elevator. While the demo itself was very underwhelming, the hardware itself does seem to have different areas that can be triggered, so it’s possible it could have been made much better use of. This could have a good future in arcade games. The Vicon people could probably make very good use of it.

Magic Horizons

This is a VR relaxation app. In the demo I tried you sit in the middle of a virtual meadow, watch the environment and shoot butterflies from your hands while soothing music plays. You can’t move, the water is completely static, and the butterflies oddly always overlap the world even when they should disappear when they go underground. They say this is because research indicated things like moving water would be distracting. I argued that when one sits by a river, the water flows and that’s part of the attraction. They seemed unconvinced.

The intended market is Human Resources departments. Personally, I’d rather HR give me some time off, or organize a trip somewhere nice.

TNO and VR Together

They had booths next to each other, both apparently used the same hardware, and both did the same thing. Weird.

They do a 3D capture of your body and insert it onto a VR environment. It looks like a very early proof of concept. You see yourself in huge voxels. Other people are seen as a very unrefined, full of holes mesh, because the system only sees you from one angle. Sometimes people look barely human.

VR Together first takes an image of the part of your face that will be covered by the headset, TNO doesn’t. VR Together had to align me manually with my 3D image, TNO had tape markings on the floor to ensure the chair was in the right place.

Overall, a barely working proof of concept so far and nowhere near being any good yet.

MeetinVR

MeetinVR (taken from their website)

Wow. I never thought I would be impressed by this kind of thing, but I guess there’s a first time for everything. This is software for VR meetings. That’s all it is, but it’s surprisingly good at what it does.

Recapping a bit, I’ve been in High Fidelity for some time, and I was there when it decided to shift focus towards virtual meetings. One of my reactions was “Virtual meetings? Come on, who needs that?”.

Bear in mind, I’m a long time fan of VR. I own the Oculus DK1 (contributed to the kickstarter), DK2, CV1 and Quest, so I have put a fair amount of time and money into it. Even then I recognize that VR doesn’t necessarily have to do everything. I work from home every week, participate in daily remote meetings, and never once I had thought “This would be much better in VR”. We use the webcam and screen sharing sometimes, and that seems perfectly adequate. VR would only seem to complicate the entire thing for no gain. Then I unexpectedly changed my mind.

MeetinVR is a seated experience. There’s a room with chairs in it and you can move from one place to another. The graphics are attractive, the avatars are customizable, and the sound works well. There’s a pen you can use to draw in the air or on a surface, it’s possible to share images, and there’s a web browser. Objects can be easily moved and resized with natural hand gestures. If you don’t need something anymore, you just throw it away, and it vanishes. Nothing particularly amazing, except that it’s just executed very well. The major hurdle is typing text in VR, for which if I remember right there’s voice recognition, besides a VR keyboard.

MeetinVR

They say they spoke to many companies to figure out what they wanted, and I think it shows: the result is very polished, very easy to use and has a few very well thought-out touches like being able to put a “can you hear me?” banner over your head that’s oddly missing from quite a few programs with a similar purpose. Everything seemed well designed, and to work as intended.

The new HiFi is going to face some tough competition here, because I didn’t see anything that was obviously lacking, and the current experience is already a good one. I’m still not sure VR meetings will catch on, but at the very least this managed to change my mind in that I no longer believe VR meetings are a stupid idea. In fact I would say that MeetinVR is not worse than doing them the usual way in most cases, and that there definitely are advantages to it. Placing objects in a 3D space, pointing at things, and drawing comes very naturally. I would say drawing in VR works much better than doing it with a mouse. For the bosses, the fact that VR effectively captures people’s attentions helps with ensuring people don’t tune out.

Overall, it doesn’t cure cancer, it doesn’t do anything amazing, but what it does, it does very well.

Thank you, Dale!

Guest Editorial: Imagining a Successful High Fidelity

Have you joined the RyanSchultz.com Discord yet? Discuss and debate anything and everything related to social VR and virtual worlds, on the first cross-worlds Discord server! More details here. 

Dale Glass as written a follow-up to his first guest editorial, What’s Wrong with High Fidelity. Here is a very lightly edited version of the article he sent me (apparently, Dale is not a firm believer in the use of commas 😉 ). I have taken the liberty of adding my own images to illustrate his text.

Imagining a Successful High Fidelity

by Dale Glass

Now that I’ve discussed what I think is wrong with High Fidelity, I’m going to try and propose a working model that would preserve as much of it as possible. I’m going to ignore solutions that involve a radical reorganization, because I think the interesting question is whether HiFi could make money being what it currently is, rather than doing things the easy way by turning it into a Second Life clone, for instance.

A successful High Fidelity will need two parts to it: a thriving community, and a thriving company. The company hardly can succeed without having users, so I will start with them.

HiFi needs content, because not everyone can make their own artwork, or code. It’s hardly an inviting proposition to join a new virtual world to find out it’s a virtual desert devoid of anything interesting, and that if you want a nice looking house, your only resort is to spend a lot of time learning how to use Blender. So one of the very first things HiFi needs is a large amount of content creators churning out a large variety of things: avatars, clothes, houses, toys, tools, scripts, etc.

To start with, here’s what I think won’t work: imitating Second Life. SL creators expect there to be asset permissions, which don’t exist in HiFi, and don’t make that much sense since without a central asset server and servers being under user control, any restrictions can be ignored. SL creators also won’t be happy with that scripts are just as vulnerable as 3D assets, because many rely on scripts to make their creations harder to clone. HiFi has made a token effort towards content protection by attempting to verify that something was officially bought on the High Fidelity Marketplace, but this is an entirely opt-in scheme, which is unlikely to make creators happy.

Any attempt to make SL businesses establish themselves in HiFi, as-is, is likely to end badly, as they will find people can do anything they want with their assets, and that there’s nothing in place to deal with it, and no solutions on the horizon, either.

How to do business in such an environment, then? My suggestion is basically Patreon and commissions. Rather than trying to shoehorn the SL business model into High Fidelity, it would be a lot better to go with a model that doesn’t need to fight against HiFi’s nature at every step, and Patreon seems to be that. A lot of artists on Patreon release work to the general public on places like YouTube, and thus don’t need to be concerned with ensuring only the right people can get at it. Patrons contribute money to creators voluntarily, wanting specifically to support the artist and not to buy a single copy of a product.

Patreon homepage

I realize that this is a rather tricky proposition, but it’s the only thing that would seem to work in such an environment. Doing things the Second Life way either requires drastically changing High Fidelity, or results in creators leaving for greener pastures.

Another thing HiFi users need is a lot of small improvements to the way the platform works. It’s missing many of the features needed for large groups of people to communicate and manage themselves – groups, group permissions, land and object ownership, to name just a few. HiFi shouldn’t stop at replicating SL here – surely one can do even better. HiFi would be well served to listening to what long time SL users have been complaining about and trying to give their users that.

Of course, the company’s business model also needs to be considered, and the problem is that in the previous article I concluded that there’s nothing much HiFi can earn money from. So what now? I see two ways forward.

The first is pivoting towards an “Open Source business model”, in which the company sells technical support, custom work, and perhaps additional functionality to primarily corporate clients. The public is allowed to play with the code without much support on the part of the company, mainly for the sake of publicity, testing, and gathering third party fixes from people who never were going to pay for a 24/7 support contract anyway. Here HiFi could benefit from changing to a “scary” license like the GPLv3 or AGPLv3, which, while perfectly okay for the general public, makes many companies deeply uncomfortable. This creates another potential source of money by offering an alternate license scheme to those who don’t like this. HiFi is under the rather oddly permissive terms of the Apache 2.0 License, which allows anybody who wants to take all their work, do anything they want to it, and contribute nothing back. This is very generous, but a dangerous way to try to earn a profit. A license like the GPLv3 ensures that any third party work also benefits the company.

GPL Version 3 Logo

Some of this already seems to be happening on HiFi’s part to some extent, and on the whole I think it’s a pretty sane direction to head in, except for that, currently, it’s not really clear what is it that High Fidelity has that other companies would want to pay for. Second Life already gave this a try, and it ended up fizzling out. It’s also a pity that this seems to involve disconnecting from the community.

How about High Fidelity being profitable by serving the users, like Second Life does? That’s rather trickier, but I think there’s some potential. HiFi would need to move to a community supported model. Since it gives everything away, there’s almost nothing that absolutely must be paid for, so the only thing that can be done is asking nicely.

This isn’t as crazy as it sounds. This idea is usually adopted by non-profits and Open Source projects like Wikipedia, KiCad and Blender, but there exist some rare for-profit examples. For example, Reddit partly works a bit like this, selling premium memberships that don’t give the buyer much, since the base access is free.

Following this idea, HiFi could offer some sort of premium membership. For instance, you could get your name listed among the list of sponsors, get some sort of distinctive sign or title next to your name, and perhaps get some privileges, like access to test servers or technical support.Most such advantages would probably be largely symbolic, but I think there’s a fair amount of people who’d send some money HiFi’s way if the cards were played right.

High Fidelity also could, and in my opinion, should at least try, offering domain and asset hosting. While they couldn’t compete with established vendors like Amazon on price, they can offer something Amazon doesn’t have: a deep knowledge of the platform. Having HiFi host your stuff should result in it being taken care of by people who know very well how it all fits together, and who are very close to the original developers. HiFi itself would also benefit, in that this would allow them to have a much better idea of how exactly the software is being used, and what problems the users run into.

A harder-to-get-right possibility would include paid custom work, on a level accessible to average people. For example, one could create bug and feature bounties where people could pledge money in exchange for features. This would be fairly tricky, but I recall that for instance OpenSim used to have bounties. Paying to be able to talk to a member of the team is another thing comes to mind. It could be useful to just be able to pay to speak to whoever wrote a given piece of code for half an hour.

To add another revenue source, I would consider selling merchandise. Things like T-shirts and coffee mugs seem like a no-brainer, providing both income and advertisement in exchange for little effort.

Developing a digital economy and taxing it is another possibility, but I do not think such a thing can amount to much in the early stages.This would be more of a long term plan, as a large user-base is needed for this to amount to anything. If High Fidelity catches on, however, this could be a pretty nice source of income.

A crucial part of such a plan would be removing all roadblocks possible for paying the company. This would involve accepting payments by every method that’s remotely practical, as well as removing every possible roadblock to content creation in general. It could be worthwhile to improve in-world creation abilities, so that something can be accomplished without needing to learn or install anything besides HiFi itself.

Let’s resume, the issue of making money by trying to sell pretty much anything that can be sold. HiFi being what it is, making a profit off it isn’t going to be trivial, so I think no possibility should be left unexplored. While HiFi’s openness allows third parties to take all their hard work and do their own thing with it, the company has the most knowledge about their own platform, and by playing their cards right, and taking advantage of an established user-base, they could outrun any competition without that much trouble.

For all this to work properly, HiFi would also need to improve its relationship with the community. By that I mean more openness and more communication, with regular meetings with users, easy access to the developers and in general a sustained effort on HiFi’s part to say “we care”. If you’re going to depend on the users’ goodwill, you have to convince them that you’re a lovely bunch of people well deserving of money.

I don’t have a whole lot of hopes on High Fidelity doing anything of the sort, of course. Part because that’s really unlike what I’ve seen of them so far, but also partly because this is not the way they’ve chosen, and it would take an awful amount of work, as well as restructuring the company and probably shrinking it by quite a bit.

What I think is a bit more likely is some third party giving this a try. Given that the code is out there, nothing technically stops anybody from taking it and trying to go in their own direction. Somebody would need to fork it on GitHub, set up a pretty website explaining their ambitious plans, put in a lot of hard work both to improve the code and to communicate with the current community, and regularly mention “please support us on Patreon”. This would be a tricky gamble to pull off given the small size of HiFi’s community at present, so I think if somebody ever does this, it’ll be an effort from an established community member.

If HiFi survives, what I think might happen is those two things, run by different entities. High Fidelity seems to have committed itself to corporate work and abandoned its original user community. But if it keeps delivering code that’s useful enough for a community to use, and the userbase grows enough, then I expect that eventually somebody will try to make a community edition. From there it doesn’t take much to fork the source, and start accepting donations, and that could get the ball rolling again.

Thanks, Dale!

Guest Editorial: What’s Wrong with High Fidelity

The following guest editorial is by Dale Glass, who had an interesting perspective on the economics of the social VR platform High Fidelity. I asked him to write up his thoughts to publish on my blog, and here they are:

What’s Wrong with High Fidelity

by Dale Glass

I showed up at High Fidelity a some months ago, looking for greener pastures. Second Life isn’t living up to its potential in my opinion, so I started looking for alternatives. I checked out several, and HiFi is the one I fell in love with. The source code is available, the system is far more flexible than SL, it actually supports VR, JavaScript is far more sane than LSL, the community is amazing… but unfortunately, there had to be problems.

I quickly found the Federated HiFi Users Discord, and one of the first questions I had to ask was: “This is very neat, but how is it going to make any money?”. Not only is HiFi free to use, but it’s pretty much impossible to give the company any money if you wanted to.

High Fidelity is a bizarre thing for a business to make. If it had been named something like “Open Metaverse” and was run by a volunteer group, it would have made perfect sense. The very structure of HiFi seems to be made to resist corporate interests and to be usable by a group of random people spread around the globe. The entirety of the source code is open, the architecture is distributed both for hosting domains and assets, and the local currency is a cryptocurrency. Now, none of those things are in the most anti-business state possible (for instance, HiFi has exclusive control over the cryptocurrency), but it’s not a terribly business-friendly design either. Normally such designs come either from projects that are Open Source or Free Software from the start, or from projects that normal people aren’t expected to be interested in paying for anyway and that expect primarily corporate clients, like databases. But HiFi decided to try to target the average person at first, and that’s where things get weird.

The main issue for High Fidelity in its original incarnation is that there is no business plan in sight whatsoever. Accounts are free. Charging for hosting content won’t work because domains are self-hosted, and so are assets. And skimming off user-to-user transactions isn’t a viable plan because it requires a huge, thriving economy which has yet to materialize, and that the company doesn’t seem to be trying very hard to support.

Compare this with Second Life. I used to think that SL’s model of selling people virtual land was a weird idea that should be done away with, but now I think that it was actually a stroke of genius. Virtual land provides a huge incentive for people to reliably pay a fixed amount into Linden Lab’s coffers, and businesses just love that sort of periodic, predictable payment. And the way SL land works provides an incentive to buy more of it: right after you buy your first parcel you find out you have limited space and prim counts, and start thinking: “if only I had a bigger one…” Even SL’s deficiencies work in its favor here. Should one want better frame-rates or a bit more privacy, it’s possible to build in the sky. But most people want to keep something on the ground, so that of course that quickly eats into one’s prim limit, which adds yet another reason to give LL even more of your money. And there’s just that people can see how big your parcel is, so having a large one can certainly be a point of personal pride. SL’s model very nicely reproduces the impetus to keep up with the Joneses.

The benefits of this model don’t end there – Second Life land allocation corresponds directly to server usage, so as the user base grows or shrinks payments and the needed resources stay in sync with each other. And since the payments are periodic and automatic, Linden Lab also derives some benefit from people who pay for resources and then forget to use them.

Of course, Linden Lab also took care of ironing out any issues that got in the way of making money – such as stopping the fluctuations of their currency, and making it as convenient as possible to get money into and out of Second Life.

This is why despite being old, not making the news anymore, and slowly shrinking, SL is still chugging along and doesn’t seem to be in any kind of imminent danger.

So let’s review how High Fidelity could possibly make money from the way things are right now:

Accounts? No, accounts are free. And in the current state, nobody would pay for one.

Hosting? No, HiFi delegates that entirely to users. It’s the likes of Amazon and Digital Ocean that make the profit here.

Registrations? True, HiFi does charge $20 per year for place names. But I can’t imagine this paying for much more than HiFi’s coffee budget. There are way too few domains around for this to amount to anything.

Charging an amount for converting USD to and from HFC? They already do so, and this is often the suggested solution to HiFi’s woes, but it’s not viable. Let’s suppose HiFi taxed transactions at 20% (which would be very excessive and cause people to transact outside of HiFi). Let’s also suppose that an employee can be had for $50K/year (which would be unrealistically cheap in California in my understanding). Then it would take 416 people, using $50 worth of HFC each and every month to pay for that single person. Supposing HiFi could exist with just 20 employees (the current team page has 60 people), that would require it having 8,320 such users. People with such an intense desire for virtual goods are going to be very rare, meaning the number of active users in such a scenario would be far higher, probably at the very least in the hundreds of thousands. With HiFi currently being deserted and not growing any, this is a completely unrealistic expectation.

Then there’s HiFi’s attitude towards all of this. Even if HiFi suddenly became popular, for some strange reason the company seems intent on making it as hard as possible to give it any money. Buying HFC involves making an appointment (!), and even then you can’t pay for it the normal way: the company wants to be paid in Ethereum (!!). It boggles the mind that in 2019 a company working with the very latest VR technology is using a banking model out of the previous century, except for the cryptocurrency part, which while very modern isn’t particularly convenient. This of course puts a brake on what little economical activity there is in it, because even to get started one needs to find a cryptocurrency exchange, register, and prove your identity to it. I have paid another HiFi user and it was easier and faster to do it through their forgotten Second Life account. The fact that the state of HFC is so bad, that the best thing to do is to ignore it entirely, isn’t good.

So, that’s how things are. HiFi in its current incarnation doesn’t have a working business model, doesn’t seem to be making any real progress towards one, and is oddly apathetic about the one way it has of earning some cash. They are pivoting now and changing track to something else entirely, but it makes one wonder how they expected the old model to work out.

Thanks, Dale! Not too long ago, I had written about somebody saying that High Fidelity was making it difficult to give them money, but I couldn’t remember who first voiced that idea. It was you! It was such a succinct and memorable phrase that it stuck with me.