XaosPrincess Reflects on High Fidelity: What Went Wrong?

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XaosPrincess at the virtual Burning Man festival in High Fidelity

XaosPrincess (about whom I have written before here and here) has just written an extensive, insightful piece on Medium, titled How to propagate a Virtual World: Conclusions from a dweller’s POV, in which she discusses various problems that she feels led to the downfall of the High Fidelity social VR platform.

As most of you already know, HiFi essentially shut down its operations on January 15th, 2020. While existing users can still sign in, all High Fidelity-hosted domains have closed, and no new user accounts can be created. However, there are at least three forks of HiFi’s distributed, open-source software code currently being worked on by various groups.

Xaos writes:

Having completed my five stages of grief about High Fidelity’s change of direction, I’m now able to view last year’s events through an analytical eye, drawing my conclusions on what can be improved in getting a virtual world to thrive.

Using Mark Zuckerberg’s breakdown of virtual reality (hardware and systems; apps and experiences; and platform services), she lays out several well-reasoned criticisms of HiFi:

In the part most important to Mark Zuckerberg – apps and experiences – High Fidelity both excelled and fell short: While all of the experiences produced by the company…were stellar, apps that facilitate social communication or media consumption – like e.g. text chat or synced video – showed great need of improvement and were often only made possible by efforts of the open source community.

However, she gives high marks to High Fidelity’s platform services:

What always had been High Fidelity’s main enterprise is the second most important area on Mark Zuckerberg’s list: platform services. While quite some users had their doubts about Philip Rosedale’s approach of favoring bleeding edge technology when it came to new implementations, to me personally there couldn’t be any better social VR package than the one High Fidelity was offering:

The open source code enabled community members to implement desired features themselves and is now – that the company has gone offline – keeping its promise of an eternally functioning virtual world.

The peer-to-peer architecture enabled content creators to be the masters of their own domains – without having to follow any TOS, everybody was responsible for their own content – free to install whatever they imagined, ranging from super safe G-rated worlds to X-rated dungeons.

By splitting up the server load into different assignment clients, High Fidelity also managed to gather 500+ avatars in one non-instanced space. Whoever has gone through the hassle of trying to join their friends in an instanced experience or game just has to love this option. And who – like me – also loves the stirring feeling of being part of a large crowd will find nothing comparable in today’s VR environment.

Noting that others such as Theanine had already written at length about the technical problems with High Fidelity, XaosPrincess saved her critique for the social side of HiFi. She raises several good points:

  • that the term metaverse needs to be redefined;
  • the importance of social VR companies in defining, knowing and catering to their target audience (using ENGAGE as an example);
  • HiFi needed to focus on creating a satisfying, bug-free user experience (“Instead of investing into flashy one-time events it might have been advantageous to focus on creating a permanent and entertaining starter experience with a bullet proof tutorial and enticing things to do in order to motivate visitors to come back.”);
  • HiFi didn’t pay attention to competitors and was overly confident that it could replicate the success of Second Life in a different era from 2003 (as I have also written about);
  • High Fidelity’s long history of communication problems with its userbase, which led to a sense of alienation;
  • HiFi’s lack of a clear code of conduct, which left many users feeling insecure: “High Fidelity never stated what kind of offenses would be met with which kind of punishment… nobody could ever be sure how bad behavior would be met.”

But Xaos saved her strongest critiques to one area where she feels High Fidelity made some grievous tactical errors: the company’s impatience to grow. She writes:

Unfortunately High Fidelity applied its mantra “Build it and they will to come,” not only to content creation in VR but also to its real life assets. When there were still no more than 30 concurrent users around in 2018, High Fidelity went on a hiring spree, quadrupling its original headcount to a workforce of 80 while tripling its original office space to two subsidiaries in San Francisco and one in Seattle. I never managed to calculate the exact burn rate, but I believed Philip Rosedale when he argued last April’s pivoting with US$10,000 monthly expenses per user.

To this day this unrealistic growing attempt is inexplicable to me. If I had been an investor I surely would have put a full stop to this amount of spending too, but as one of its highly engaged high-cost users I just wish High Fidelity would have balanced its expenses in line with its slow but steady population growth.

The snowball effect of visitors becoming content creators and enticing new users themselves could have led to an avalanche of attractions for even more new users, if High Fidelity wouldn’t have been impatient.

Instead of giving its community members time to grow into their roles as content creators or event organizers, High Fidelity turned to setting up unsurpassable events by itself, and even paid users for attendance by handing out prizes or Amazon gift cards. This irritated the natural growing process, as these well-meant contests kept the content creators busy, while also being a big competition to individually organized community events.

And when High Fidelity then pulled the plug on all its company operated domains in April 2019, there weren’t enough skilled and motivated community event organizers around to attract new users, and without events there was no more appeal for new users to pay a visit.

As I see it, a more natural growing attempt, incentivizing community members to attract new visitors, could have been beneficial to the overall user numbers.

These are just a few choice quotes from XaosPrincess’ blogpost, which I strongly encourage you to go over to Medium and read in full. Thanks, Xaos!

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Editorial: High Fidelity, Sansar, and the Sin of Hubris (and why Second Life Users’ Hatred of Sansar Contributed to Its Downfall)

One evening last week, I decided to take a break from the Educators in VR conference sessions, and I did something I had not done in at least two months—I loaded up an anonymous alt and I paid a visit to Sansar.

Like most other worlds in Sansar, the Galleria shopping mall I visited was utterly deserted, despite showing up at the top of the Popular list in my Codex. (There were certainly no more than forty avatars total in all of Sansar on this particular evening.) After half an hour of morose window-shopping, I signed out again, feeling even more depressed than when I signed in.

I find it almost inconceivable that a mere eleven months ago, we had not one but two social VR platforms, into which their respective companies had poured years of software development work and millions of dollars, throwing splashy, well-attended events in an effort to outdo each other. Today, both of those companies have laid off dozens of staff, one platform has shut down completely, and the other is actively shopping around for someone to take it over, or it will probably shut down too.

Sansar user Zero Cheese posted the following three-minute recording of the most recent Sansar Product Meetup to his Twitter, where the users took to the stage instead of the Linden Lab staff, and instead of cheering me up, all it did was break my heart:

Throughout my three-year journey as a beta tester and blogger, one of the most special things about Sansar has always been its intrepid community of users and content creators, who may have been small in number but mighty in spirit.

There was always the feeling that the next wave of users would be just around the corner, that the next update with its shiny new features would be just enough to entice people to come in, to pay return visits, to move in, to set up homes and stores, and to build a new world.

It never happened. Why?

There will be no shortage of onlookers (armchair quarterbacks) who will speculate on what they think High Fidelity and Linden Lab did wrong, but I would suspect that many of their answers would revolve around one word: hubris.

To the ancient Greeks, hubris referred to extreme pride, especially pride and ambition so great that they offended the gods and led to one’s downfall. Wikipedia says:

Hubris (/ˈhjuːbrɪs/, from ancient Greek ὕβρις) describes a personality quality of extreme or foolish pride or dangerous overconfidence, often in combination with (or synonymous with) arrogance.

Simply put, it was that the people who ran High Fidelity and Linden Lab thought they already knew very well what people wanted, largely based on their shared past corporate experience with Second Life. Oh, they still sought input from the users, from time to time, but overall, they went ahead and did exactly what they pleased, confident that (to borrow a line from the 1989 movie Field of Dreams) if they built it, people would come.

Well, they built it (or, at the very least, they made a good solid start of building it). But the people didn’t come. Why?

Nearly two years ago, I wrote in an editorial called Second Life Versus Sansar: Why Linden Lab Can’t Win, No Matter What They Do:

I think that Ebbe Altberg and his team at Linden Lab can’t win no matter what they do. If they continue to throw too much time and money at Second Life, Sansar will suffer and they’re betting the future on Sansar…Yet if they try to promote Sansar…folks who are wedded to Second Life get upset. 

Wagner James Au of the long-running blog New World Notes received a torrent of comments from Sansar haters when he reported on the current uncertain status of the Sansar project last Friday. It would appear that many Second Life users are still extremely upset at what they feel were all the resources that Linden Lab put into Sansar—time and money that they feel strongly should have been invested into improving Second Life. (Note that we do not know, and will probably never know, what outside investors put their money into Sansar, if any.) That visceral hatred fed into the perfect storm of events that has put the Sansar project in the position it is now in, being shopped around by Linden Lab in hopes of finding investors, lest it pull the plug completely.

Reading through all the comments in Wagner’s blogpost got me to thinking: how could Linden Lab have handled this situation better? Hindsight is 20/20, but to me it seems clear that the company could have handled its messaging about Sansar to Second Life users a lot better than it did.

The message from Linden Lab was clear: Sansar was not intended to replace Second Life; they were meant to be two separate platforms. While that might have allayed the many initial fears by Second Life users that their beloved virtual world was imminently going to be shut down, it also sidestepped the bigger question: how was Linden Lab going to move users from Second Life to Sansar? Because it rapidly became obvious that most Second Life users, in fact the overwhelming majority of them, were very happy with SL, thank you very much, and nothing and nobody was going to entice them to move.

Galen, in his most recent guest editorial, was right: Linden Lab should have built some bridges between Second Life and Sansar, in order to make it easier to gently encourage SL’s userbase to begin to explore Sansar. Expecting users to give up their inventories and start over again from scratch in a new virtual world was probably a tactical error. Why couldn’t we have used the Linden dollar in Sansar, for example?

I do remember that, at some point in the past, I read that Linden Lab was going to “reserve” all existing Second Life usernames in Sansar, so they could be assumed by SL folks who wished to migrate over and keep their identities. What happened to that plan? What happened to any plan to make it easier to Second Life users to migrate?

Linden Lab’s mismanagement of communication with its Second Life users with respect to Sansar and their intentions was, I believe, a key factor in their downfall. We will probably never know what Linden Lab’s big game plan was with Sansar vis-à-vis Second Life. Perhaps they didn’t even know themselves. But it’s clear that they felt they knew how to repeat that early success with Second Life. And they have been proven wrong.

Philip Rosedale, the founding CEO of Linden Lab and creator of Second Life, also thought he knew the secret to creating a successful, popular successor to Second Life. And he, and the team he led, were also proven wrong.

It has been a rather spectacular downfall for both companies.

Where does everybody go from here? Hell if I know. I just report on the events; I have long given up trying to predict them. My track record is crap. For example, I predicted Cryptovoxels would fail, only to see the platform thrive. I predicted Virtual Universe would be a success, only to see it fail and fold. And I was completely taken by surprise at both High Fidelity’s and Sansar’s layoffs over the past twelve months.

It remains to be seen whether the newer crop of social VR platforms and virtual worlds will learn from what happened to High Fidelity and Sansar, or even what the lessons to be learned are. More remains to be written, but I will leave that to another day.

P.S. Yes, I know; I said I wouldn’t write about Sansar. I changed my mind.

UPDATED! Guest Editorial by Theanine: High Fidelity—What Went Wrong?

I was planning to write up a detailed post-mortem blogpost about High Fidelity, when my friend Theanine wrote an excellent article on the same topic, and posted it to his Medium account today. Theanine wrote a well-argued, thoughtful essay, which is far, far better than anything I could have written myself, informed by his many years of working on the platform as a content creator, with his background as a game developer and a game artist.

Theanine very kindly gave me his permission to repost his work here as a guest editorial, along with his pictures.


Please note that Theanine has asked me to remove his guest editorial from here, and refer people to his original write-up on Medium. Thanks!

Philip Rosedale: Four Reasons Why Virtual Reality Has Not Taken Off Yet Among Consumers

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Image by jazilykenneth from Pixabay

Philip Rosedale (the founding CEO of Second Life and the CEO of High Fidelity) used to have a very ambitious goal printed across a large banner hung over the stage at HiFi events: One Billion People in VR, it read.

It was the company’s goal to get millions of people in VR headsets and using their social VR platform. But those millions of people never came, and Philip Rosedale has been spending some time lately doing a bit of reflection about what went wrong, and why that never happened.

Yesterday, he penned a post on the official High Fidelity blog, titled Requiem for the HMD, outlining what he sees as four key problem areas that need to be addressed before we can expect to see widespread consumer uptake of virtual reality headsets:

  • They need to be light and comfortable enough to wear all day: “The weight needs to drop to the same as ski goggles — about 300 grams.”
  • Good see-through display: “You need to be able to see the world around you while you are using these things.”
  • They allow you to type at a normal speed.
  • The display is the same quality as a desktop screen.

Philip writes:

It’s hard to say when these challenges will be solved and packaged into one elegant solution at mobile-phone price points. I’m clearly not the only person who thinks we’re in the thick of winter for consumer-grade VR headsets. In the meantime, I’ll keep rooting for the commercial-grade applications that show the world what’s possible and to funnel enough money into the industry with the hope that the next screen comes out in the not-too-distant future.

If you want to read Philip’s blogpost in full, you can do so here.

What do you think? Is Philip right or wrong, and why? Please feel free to leave a comment below. And I also cordially invite you to join the conversation over on the RyanSchultz.com Discord server, the world’s first cross-worlds discussion forum! Over 300 people from around the world, representing many different social VR platforms and virtual worlds, meet daily to chat, discuss, debate, and argue about the ever-evolving metaverse and companies building it.