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Second Life Still Gets Great Press, Even When It's Dying

flunomedWith the art world imploding alongside the economy, we could all use an inspired feel-good-art-is-still-alive story. But to describe Second Life—which has about 65,000 users logged on at any given time—as the zeitgeist of the art world? Maybe if it were 2006. But don't tell that to the editors of The New York Times Magazine, which just ran a huge feature about Filthy Fluno, the influential afroed avatar of Boston-based artist, Jeffrey Lipsky.

Three years ago, Second Life was predicted to be more ubiquitous than MySpace, YouTube, (and probably Facebook, had it been around). Not only was it a virtual world anyone could participate in—as magazines like Business Week splashed on their covers—it was actually poised to be a viable parallel economy with its own currency system and tribes of virtual entrepreneurs. VC's pumped $19 million into the Silicon Valley startup, while marketers, news organizations, and politicians alike (American Apparel, Starwood Hotels, Wired, and Reuters, to name a few) flocked to the avatar-colonized otherworld to connect with the hoards of consumers rumored to be there. Well, it turned out the millions of visitors hyped by Linden Lab, the company behind Second Life, were more illusion than reality.

Second Life is now experiencing its own dystopia. Its visionary founder and resident hunky geek CEO, Philip Rosedale, stepped aside as chairman last year, and has since been reduced to a speaking circuit regular. In April Mark Kingdon, a Wharton MBA-turned-PriceWaterhouseCoopers partner-turned-Organic [digital agency] CEO, was named prince of the Linden Lab kingdom, and with him came more veteran grownups, including talent from Pixar, Adobe, and AOL. Most recently Linden—which earns revenue from selling virtual "land" to residents—recruited Big Spaceship, a Brooklyn based digiital shop (behind HBO's hypnotic and controversial Voyeur website), to redesign Second Life's entire user experience, which has been criticized for being too nebulous.

Second Life's biggest hurdle has been seducing the merely curious and turning them into everyday users. The challenge ahead for Kingdon and his team is that the virtual world's 15 minutes of fame is already in the cultural rearview mirror (not to mention its last round of funding, which arrived three years ago). CMO's and consumers have already moved on to the next best thing (Twitter, anyone?).

Is there anything Second Life could possibly do to lure you back for a second time?