Masters of Disruption: How the Gamer Generation Built the Future 
Long before Meta, there was Second Life.
This post is part of a longform project I’m serializing exclusively in my newsletter, Disruptor. It’s a follow-up to my first book, Masters of Doom: How Two Guys Built an Empire and Transformed Pop Culture, and it’s called Masters of Disruption: How the Gamer Generation Built the Future. To follow along, please subscribe to Disruptor and spread the word. Thanks!
This article of mine first appeared as “Inside Second Life,” Rolling Stone, April 1 2007.
In the real world, Philip Rosedale is a 38-year-old with California Ken Doll good looks — peppery hair and bright blue eyes, faded jeans and a loose beige sweater. He sits at the Fog City Diner, a tiny shiny restaurant off the Embarcadero in San Francisco. But when he makes pronouncements about the other world, which is often, he leans forward, drops his voice to a biblical whisper, and widens his stare. “Once we have enough computing power,” he says, “we can remake the world using simulation.”
There are certain things you will only do in reality. Like eat tuna tartare, says Rosedale, who digs into a plate of the pink stuff in front of him. But just about everything else will happen in virtual reality. “The only thing I say to people who yearn for an earlier time,” says Rosedale, “is that you’re not going to have an opportunity to hide from this phenomenon.”
Rosedale is the creator of Second Life, the virtual world that’s garnering the most excitement online since the launch of the World Wide Web. Once you download and boot-up the free program, Second Life makes going online more like a computer game. Instead of surfing Web pages, you create an animated character — an avatar — which you use to explore three-dimensional lands, from seaside towns to industrial Goth discos. Everything “in-world” is created by you and your fellow Second Life residents using built-in tools. The result is a place to wander, socialize, build, shop and screw.
Weird as it sounds, there’s real money involved: To purchase stuff in Second Life you spend fake currency called Linden Dollars that has actual economic value. A slim-cut American Apparel shirt for your avatar costs around 250 Linden Dollars, or roughly one U.S. dollar. Residents now exchange about $1.8 million per week for digital cash — a number that’s growing up to 20 percent a month. Fifteen million people have paid a visit, and there are up to 28,000 logged on at a given moment. Over the past year, the total amount of time that Second Life residents spent in the world has gone from about 2.6 million to more than 15 million hours per month.
A lot of people, big and small, think Second Life is the future of the Net. Corporations from Sony to Sears to Mercedes-Benz maintain stores inside. Artists including Jay-Z and Ben Folds have performed live in avatar form. Mia Farrow held a rally on Darfur. A John Edwards volunteer set-up a presidential campaign headquarters (later trashed with Marxist slogans by Republican vandals). Harvard Law School offers “classes” inside. The Swedish government has an office in-world, as does the National Oceanic and Atmospheric Association. As Reuben Steiger, head of Millions of Us, a social media agency that has brought clients including Warner Brothers, General Motors and Intel into Second Life, says, “Last year’s MySpace page is this year’s avatar.”
In terms of square miles, Second Life is now about the same size as New York City — and growing. You don’t walk very far inside — for smaller distances, you fly, and for longer trips, you teleport. The lifeblood of its virtual economy is real estate: In order to build, you have to shell out cash for the land beneath you. The Lab charges $1,675 for your own island plus a $295 monthly maintenance fee, or you might rent land for 75 Linden Dollars or so from one of Second Life’s many real estate barons.
You can pay out of your real-life bank account, or try to earn money within Second Life: Some sellers pawn virtual designer jeans and stiletto heels in Midnight City, a mall. Others work bars and nightclubs, where tiny Barbarellas service you for Linden cash. Most of the cybersex is of the standard hot chat variety, though industrious johns augment their avatars with cartoon cock-and-balls. Keyboard shortcuts control the bump n’ grind. The going rates for a prostitute named “Bliss Nephilim” are as follows: about 800 Linden Dollars for a half hour of “one on one,” 1,000 for “role play,” and a cool 300 for 15 minutes of avatar oral.
It’s not just getting off that turns early adopters on, though. It’s the bigger evolution at play, the serious and significant transformation of the internet from something to surf, to a place you hang. “The Web is a lonely place in lot of ways,” says Giff Constable, general manager of the social media agency, Electric Sheep, “What’s powerful about Second Life is the social aspect, the sense of togetherness.”
Second Life’s financial backers include Jeff Bezos, founder of Amazon, Pierre Omidyar of eBay, and Mitch Kapor, the Lotus founder who helped spark the PC boom in the 1980s. “Virtual worlds will be as important as, and eventually merge with, the internet,” Kapor promises. If this is sounding like the internet in 1995, it’s supposed to. But there’s one key difference this time around. Unlike the Web, Second Life is controlled by one evangelical dude, Rosedale. And as the creator of this brave new world, he’s starting to feel like a God.
“I realized this is like the Greek pantheon,” Rosedale says, and he’s thinking about creating an avatar in his image. “I like the idea of being a young Apollo. All marble. Like I’m made of stone.”
Rosedale grew up the brainiac son of an English teacher and Navy pilot, the latter of whom Rosedale describes as “like the Great Santini. He’d make us play barefoot in the gravel to toughen us up.” In the tiny town of Hollywood, Maryland, Rosedale’s parents enrolled their bright boy in a Baptist trailer school, where a 26-year-old pastor preached fire and brimstone. As soon as he could write, Rosedale decided to copy the Scriptures. “I was like, ‘I’m going to transcribe like the monks,'” he says, “‘I’m going to rewrite the Bible.'”
By middle school, his religious conviction shifted to a place where he could really be the ruler of his own universe: his computer. Rosedale had a life-altering epiphany one day when he was goofing around with math modeling programs on a friend’s PC. With a few strokes, he discovered, he could create simulations of the real-world inside his machine. “I remember just turning to my buddy, and saying, ‘It’s all in there!,'” he recalls. “‘This is like outer space!'” “God is in the machine,” as he now likes to say. “The Code is law. The Code is God.”
To escape the pressures of his parents’ bitter divorce, Rosedale began constructing a fantasy world from spare parts. He spent hours at his computer, installed a mechanical Star Trek door in his bedroom, made a hovercraft in his backyard. “I thought it was a good way to meet girls,” Rosedale says. At school, he seized any opportunity to convert his classmates into technophiles. His best friend, Brock Wagenaar, recalls the time Rosedale went on a tear at school about the science of the atomic bomb (still an obsession of Rosedale’s today). “He was very good at preaching, if you will,” Wagenaar says. “He really likes to hear himself talk.” Rosedale put that skill to use when, while still in school, he had a job selling used cars. “It’s an interesting aspect of Philip,” Wagenaar adds. “Not to sound negative, but he believes his own bullshit.”
After studying physics at the University of California at San Diego, Rosedale created a video compression technology which was bought by RealNetworks, the powerhouse in digital media delivery, in 1996. He became Real’s chief technology officer, and would make enough millions to retire, but he didn’t leave his dream of a simulated world behind. One day, Rosedale preached his grand vision to Jaron Lanier, the dreadlocked Berkeley professor credited with coining the term “virtual reality.” Lanier says he gets approached weekly by entrepreneurs looking to cash in on virtual reality, but Rosedale’s ambition and drive stood out. “It’s similar to the talent of great military warriors,” Lanier says, “who are incredible persistent and have the ability to deal with bizarre stuff, and be a sweet talker. He has all those qualities.”
But Rosedale’s adrenal riffs on data gloves and virtual reality bodysuits raised eyebrows even among the seasoned digerati at Real. “He had some ideas that were out there, and some that were way out there,” says Rob Glaser, CEO and chairman of Real. Rosedale could get explosively frustrated when people didn’t see eye-to-eye. One night in 1999, he and some buddies from Real went to see the Matrix. After the flick, the guys hit up a bar, tossing back drinks as they effused over the film’s vivid depiction of a virtual reality. Everyone, that was, except for Rosedale, who sat at the table sulking about the film’s dystopian view. When one of the guys asked him why he was being such a buzzkill, Rosedale grabbed him by the shoulders like a mad scientist and barked, “I’m going to build that! And it’s not going to turn out that way!”
Rosedale took his millions and split. A pivotal stop was Burning Man, the orgiastic festival in the Black Rock Desert of Nevada. A self-described introvert, Rosedale got turned in a major way by the togetherness and expressiveness of the scene. “I would just walk up to you and be like, ‘Dude, nice outfit,'” he says. “I wasn’t high. I was just walking around and just felt that way.” There was something about being stuck in the desert with a group of strangers, and forming what he calls this “magical social construct” that spoke to him deeply. And, though he’s only been to the festival once, he says it remains a profound influence for the alternate society he’s building.
“Burning Man is wondrously purposeless,” he says. “It asks you not to have a reason to be there. You’re brought together by hostility of the environment. You think you could die out there, and you could die. It gets cold, the wind comes up on you. You’re brought together by a need to protect each other in the harsh environment. Second Life is a new scary, difficult environment. People are brought together by their desire to help each other through it at the beginning…Burning Man is Second Life.”
With 3-D video technology for computers and networking hitting the tipping point in 2000, Rosedale knew the time was ripe to build the code. Back in San Francisco, down an alley called Linden Street, he began bringing his own virtual Burning Man world to life. He started by soldering together a Lawnmower Man-like contraption he called the Rig. The Rig now occupies a cluttered backroom at Linden Lab, and Rosedale eagerly showed it to me during my visit. It’s a hunk of steel hooked up to a computer with a headrest attached. You lower hear head against the rail, and put your hands flat against a board so that you are immobilized. Computer monitors surround you. Though you can’t move, tiny strain gauges pick up the slightest twitch in your hands and head, and translate this information into movement on screen.
With Rosedale working like Dr. Frankenstein, word spread through Silicon Valley of this wacky guy who was looking for people to join him at his start-up, Linden Lab. Cory Ondrejka, a fledgling game programmer, was told by a friend: “I just interviewed with a guy who may be crazy. But I’m not sure if he’s crazy good or crazy bad.” When Ondrejka met Rosedale, Rosedale effused about creating a living ecosystem in a computer-generated world. “Let’s build this beautiful forest,” Rosedale invited, like some dot com Tim Leary. It was crazy, Ondrejka decided, but in a sorta groovy way. “This was a chance to do something bigger than games,” he says. They knew where they wanted to begin — by simulating the seas. “We started with water,” Rosedale says. “It was Genesis.” When I first interviewed Rosedale in 2003 after Second Life’s launch, he told me his goal was to “simulate reality in total.”
With Rosedale at the controls, Linden Lab lured Burning Man minded geeks from around the Bay Area, who transformed his company into their own culty mecca. Like something out of Logan’s Run, they began calling the place “the Lab.” In Second Life, their avatars proudly brandish the familial surname, Linden. Around the office, they don leather necklaces with pendants of the Second Life logo — the ancient eye-in-palm talisman called The Hand of God. “All seeing, all knowing,” Rosedale says. The Lindens, like generations of San Franciscans before them, fashion themselves as revolutionaries in the truest sense. “We all ride motorcycles and hang out in North Beach,” one bearded Linden tells me during my visit. Another says, “We drank the Kool-Aid, brother.”
On this day, the Lab buzzes with activity, as blue-haired and tattooed Lindens tap their keys in cubicles lined with rubber ducks and dog-eared copies of Neuromancer. There’s the fuzzy feeling in the air, like a Dead show parking lot, but Jerry is among them. Rosedale occupies an open desk in the middle of the room, and commits himself to keeping the good vibes amped. “Let me show you what I mean,” he says, spinning gingerly around to his PC. There are pictures of his kids on his desk near a DVD of Apocalypse Now, one of his favorite films to quote.
With a few strokes, he punches up an in-house message board on his computer which he calls “The Love Machine.” The Love Machine is basically the Linden’s neo-hippie version of a perpetual Valentines. Throughout the day, Lindens post little affirmations to each other online. “Thanks for having too much integrity for one single person,” reads one message to Rosedale. “It feels wonderful,” he says. Rosedale uses the Love Machine to evaluate employee performance. The more love you receive, the better you do. Now he wants to move it from Linden Labs into Second Life, so that Residents can heart the Lindens too. “I would like everyone within Second Life to be able to send us love,” he says, locking eyes. But reality keeps getting in the way.
“Do you mind keeping your voice down, ma’am?” a surly cafe owner tells Catherine Fitzpatrick. It’s a miserably cold New York City day in reality. Fitzpatrick is a heavyset 50-year-old mom with glasses, frizzy gray hair and a faded jean jacket. She studied at the University of Leningrad and now works as a Russian translator and as a human rights activist. She says she’s working on Second Life “the same way I work on any country that’s oppressed.” For her efforts, she claims, she has been stalked, and received death threats.
“At first you think, well this is very attractive and open and free and Whole Earth Catalog and hippies. What’s not to like?” She barks, “Then you get in and find they’re rigidly orthodox!'” She’s not alone in this thinking. A branch of the Second Life subscriber base has become decidedly anti-Rosedale. They accuse the Lindens of silencing critics, tipping off insiders on business deals, and downplaying technical problems that could affect Second Life soon. The most dramatic charge is that the future of the internet is at stake: Is it going to be true society, or a mall, controlled by private interests?
“You can’t have government in the pocket of top business,” says Fitzpatrick. “You need some rules.” In June 2005, Fitzpatrick received a notice that she was banned — permanently — from the Second Life forums. The official reason for her ban was “trolling,” or being abusive to other members, but Fitzgerald says it was because she was being too critical of Linden Lab. Following her ban, a Linden Lab chat log surfaced on the internet in which the Lindens plot a way to silence their biggest critic. “Prok [Fitzgerald’s user name] never ‘technically’ violates the Community Standards,” wrote one Linden. “So change them,” another replied. Another spelled it out more clearly: “Ban Prok.”
After the incriminating chat log leaked out online, the responsible Linden publicly apologized for having “lost it.” But it revealed how, in Second Life, the keepers of the Code dictate the Law. Their Ten Commandments are a list of rules they call the Big Six. Among the tenets is to “refrain from any hate activity.” Images with swastikas will — and do — get you ejected from the world. “If someone isn’t moving the conversation forward,” says Daniel Linden, the Lab’s director of community affairs, “I don’t see why they should be there.”
When asked about the Lab’s questionable banning of Fitzpatrick, Rosedale — who fields emails from her with some frequency — doesn’t apologize for giving her the ax. “I do think it is reasonable,” he says, “just like running a kindergarten.”
On October 29th, 2006, Fitzgerald claimed that the Lab had done the virtual equivalent of insider trading: telling select barons of an impending hike in land prices, which would allow them to snatch up land at lower fees, before the plebian owners could get their share. Rosedale himself admitted his wrongdoing. “We probably made a mistake there, trying to get feedback,” he said at the time. “We should just tell everybody everything.”
Second Life contrarians are becoming an increasingly disruptive presence in the world as it becomes more commercial. During an in-world event featuring Second Life’s largest land baron, Anshe Chung, pranksters unleashed an attack of flying penises. A group dubbed the Second Life Liberation Army crashed the opening of the American Apparel store in-world, as well as a number of avatar events from the World Economic Forum in January.
-One afternoon, I teleport into a red-bricked loft that serves as the headquarters of the Second Life Liberation Army. Pictures of Subcomandante Marcos hang on the walls. A Flock of Seagulls song plays on the radio. A bald avatar guy and two attractive women in black miniskirts wear Zapatista black T-shirts with red stars. “We are a vanguard movement in the revolutionary sense hoping to push the debate forward,” says their leader, who goes by the Second Life name Marshall Cahill. Their goals are, he says, “limited political rights. We envision this first being consultative and then more binding – we also see it tied to property holding rights. Second Life is a user-created environment in a way that has not really been seen before, therefore political rights are needed to not only safeguard the financial and social interests of residents already in Second Life but to ensure that Second Life continues to grow.”
With revenues of $11 million last year, and a projected $30 million this year, the Lab’s balance between building a brave new world and making a profit (which they haven’t yet) is getting more complicated. The Joint Economic Committee of the U.S. Congress is conducting a study on the possible taxation of virtual items. “Virtual economies are still at the early stage of development,” says J.E.C. chairperson, Congressman Jim Saxton, “so it is difficult to predict how tax policy toward them might evolve over the next five or 10 years.”
“I’d like to see it get to a point where it’s all irreversible. It’s all a little bit too under our control.”
Linden Lab has already started its mission to “open source” much of Second Life — that is, open the software up to many different non-Linden programmers. But that could devalue the in-world land, some fear. And the Lab isn’t exactly reassuring. “The Linden Dollar is not currency,” says the Lab’s chief financial officer, John Zdanowski, “You’re not guaranteed to get your money out.” Especially not if — or when — the system crashes. Right now, the Labs servers support a maximum of 30,000 concurrent users. And fixing the problem is not as simple as just building bigger servers — the challenge is rolling out a database system that can adequately handle the crush of traffic. According to one of Second Life’s chief coders, Andrew Meadows, the entire world would zap off if more users than that tried to log in. “The database would fall over,” he says.
When I raise this question with Rosedale one morning in the Lab’s lobby, his blue eyes fade a little. “If this curve continues,” he says, showing me a graph charting new users, “the rate of growth would be unsustainable.” He gives a similar hedge when I point out that the top Second Life destinations are not idyllic ecosystems, but online sex spots. “Well, I think it’s like the Web,” he replies, and then falls silent. In darker moments like these, he likes to quote his favorite line from his favorite DVD (also on his desk), Willy Wonka and the Chocolate Factory: “So shines a good deed in a weary world.”
But Fitzgerald won’t let him shine for long. Rosedale goes to his PC, where he finds a teasing e-mail from Fitzgerald for not actually owning any land in Second Life. In quirky fashion, Rosedale responds by creating a blank black monolith. “I wanted to build something really mysterious,” he tells me. Then he says, “Let me show you something really cool.”
Rosedale teleports to his favorite spot in-world. It’s an artificially intelligent island designed, he tells me, by a computer genius. There are birds. Weird animals. Vegetation growing on stems. This is what he always imagined Second Life would be.
“I’d like to see it get to a point where it’s all irreversible,” he says, “It’s all a little bit too under our control. That power shouldn’t be in our hands. We don’t want to make mistakes. For me, there’s a critical point that we’ll get to where everyone can take this stuff and run with it.
“Once we get there, I personally will feel like I did it,” he says. “In the biggest possible way.”