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Robert Bloomfield, a Cornell University economist and virtual-world watcher who had argued that self-regulation deserved a chance to fix Second Life's financial problems, says he believes that banks will face runs and be unable to pay depositors, triggering new losses. (See "Second Chance for Second Life.") But he says that the larger Second Life economy, which by one recent measure has more than 300,000 participants, would not be profoundly affected because people will still be able to make, buy, and sell digital goods and exchange virtual and real dollars.
Yesterday, within Second Life, depositors appeared to rush to withdraw money from remaining banks, such as Midas Bank and BCX Bank, and some waved signs saying, "Linden Lab: Give Us Back Our Banks Now!" By one account, avatars of bank owners gamely stood guard outside their virtual institutions. "In a half-dozen of the largest banks, I saw the owners, CEOs, and chief financial officers all standing in the foyers, putting up notices and attempting to reassure their depositors. The bling! The prim hair! One man even wore white gloves," wrote Prokofy Neva (whose real name is Catherine Fitzpatrick) in her blog.
Bloomfield is hosting a forum on the matter in Second Life today at 2:00 p.m.; the forum can be found here. One open question, Bloomfield says, is whether the ban would pertain not just to banks but to stock-market exchanges that have also popped up in Second Life. Linden Lab declined to participate in the forum, Bloomfield says.
Virtual worlds need the freedom to self-correct, argues Robert Bloomfield.
Recent fraud allegations are ominous for those who see virtual worlds as future centers of e-commerce.
A series of upsets could spell trouble for Second Life's virtual economy.
Guest (ProkofyNeva)
Re: "I think the timing may well have been due to [that]story," says Ben Duranske, an Idaho lawyer who has been closely following the complaints of Second Life participants.
Oh, we can't know that's true, as the Lindens have been pondering what to do about this for months and months. They hired Ken D Linden, after all, who is a real attorney evidently and skilled in this area who has studied this situation very carefully and decided how to take action. That Linden blog post is really the most remarkable document, in the history of Linden Lab, revealing quite a bit about the Lindens' own inability to cope with the "emergent behaviour" of their grid. And that did not get written in a day, or two weeks ago. So this has been a process that outsiders can at best claim only to hasten.
But...let's parse what it means if Duranske -- and Technology Review, since they seem to agree with Duranske -- can force the hand of a software company to change the rules in its world.
Did anybody get to elect or appoint your or have any supervision of *your* vast powers?
I think the editors of Technology Review have to contemplate what this means to help cause a run on the bank of Second Life and destroy hundreds of people's savings. It means that not community-based institutions within Second Life, and not real-life law-enforcement authorities get to decide how the Metaverse will be financed, but non-practicing Internet attorneys like Duranske and an online tech magazine supported by a prestigious university. It means you're deciding what's illegal by publicizing it and declaring it as such, in your minds, and forcing the hand of Linden Lab, under prejudice of the prestigious tech press.
Who's virtual here?
Obviously, an article in Technology Review wasn't the fundamental cause of Linden's actions...no doubt they have been thinking and planning for some time. But why wouldn't mainstream press coverage affect the timing of their actions, just as it does in every other realm of business and political life.
No one elected the Wall Street Journal to write critical articles that may have been the proximate cause of Enron's collapse. Other than, of course, the reputation the WSJ has earned with their readers.
How is this different?
Guest (ProkofyNeva)
It's Benjamin Duranske primarily who says Technology Review *was* responsible for LL's policy(because of his interview for it?), although when I pointed out that his blog helped precipitate the Ginko collapse, he denied it. So which is it?
While I don't believe you can credit the blogosphere or online tech media or even mainstream media for a decision Linden Lab has been discussing for months (as we know from their office hours and meetings inworld), we still have to ask very real questions about the power of the blogosphere and tech media sphere to affect virtual worlds that do not have robust democratic and liberal governments like real life countries, and don't have the checks and balances of real life.
When the Wall Street Journal investigates an Enron situation and helps bring about prosecution of Enron, it is doing so as an institution established for a century, with an editorial board, a public face, a sense of accountability to advertisers and shareholders and a sense of the public trust, and so on. And it isn't making the pronunciation of "guilty" and deleting the buildings of the company with an executive authority, or influencing an executive authority so swiftly and directly. It's publishing fact and opinion, and then *other* separate bodies then pursue the crime to resolution of prosecution and confiscation of property. There is due process. There isn't due process here in this virtual situation.
Blogs that have existed for a month or a year run by one person; online tech journals are a relatively new phenomena and aren't the kind of institution that that largest-circulation business newspaper in America is, like the WSJ. THAT is the difference, Rob.
I'm the first to root for the rights of individual independent uncredentialed bloggers to speak out and play a role in investigating matters of the public interest. But I don't attempt to pronounce something in a virtual world as unlawful and incite prosecution of it and confiscation of property.
In your Metanomics series, Rob, Benjamin Duranske incites prosecution of Philip Rosedale as an accomplice to money scams in SL, then doubles back and says in fact Linden doesn't have much exposure as liability. Well, which is it? And that's a serious thing to be doing. I don't believe the Metaverse can be run by anonymous and incompetent kids making "banks," but I don't think the answer is to have blogging lawyers and tech journal pundits inciting runs on the bank and swift concoctions of power, either, and deciding what is legal or illegal by their lights and by their own interests.
I think this has to be more consumer-driven than it has been by protecting rights, not prosecuting wrongs that only the elite get to identify. Rights are protected when people affected are part of the process of finding the facts and deciding how to prosecute wrongs. The media can have public support in "trying a case," when it is diligently finding facts.
David Talbot asks the plaintive question: who is this owner of Ginko's and where is the money? I've sent him emails on my theories about this; so have many others. It's a good question, but it's not enough to ask a good RL question in a world where this anonymous avatar he finds so disturbing in fact keeps logging on, in fact keeps attempting to solve problems, and others make decisions about his assets and take responsibility for his liquidation who keep logging on. If David is serious, he could assign journalists to pursue all the leads and attempt to answer the question, as the Wall Street Journal would do about Enron. The WSJ didn't just post op-eds saying "We think Enron is guilty because they don't answer our simple questions". They did the legwork to interview people, find documents, put together hypotheses, check them. Nobody makes time for this in the online tech media and blogosphere. And could a tech journal justify long hours and resources spent mucking around in a virtual world pursuing not a tech story, but a common fraud story, even if the hook is "wire fraud"? I'm not sure.
As for "No one elected the Wall Street Journal to write critical articles that may have been the proximate cause of Enron's collapse. Other than, of course, the reputation the WSJ has earned with their readers" -- the difference is that the Wall Street Journal has credibility in pronouncing on public affairs. It participates in them. It reports diligently on business and the stock market on the world that it is reporting on.
Tech Review is parachuting in and may never return to this story again.
There seems to be some confusion (or willful misreading, it's hard to tell) so I should make it clear that I doubt, of course, that the overall motivation for this policy came from the original article. Obviously, the policy has been a long time coming and was clearly the result of a fair bit of internal thought. My comment was pretty specifically only about timing.
In other words, it may well have moved the announcement up from a Friday (Linden Lab's usual day-of-doom for these kinds of things), or prompted them to implement a bit sooner than expected, something like that, but that's all. This policy was posted and likely constructed by Ken Linden, an attorney, and attorneys tend to be rather less responsive to the press than that. My comment was meant only to refer to the specific timing of the policy.
That's not to take away from the original article, which was the first to put a human face on this problem and likely did make the rounds at Linden Lab, and as Robert pointed out, pressure from the press certainly does guide corporate actions.
Any lack of clarity on this point is my fault, not David's. I replied to his question off-the-cuff and perhaps should have been more clear exactly what I meant when we were emailing back and forth about it.
[Edited typos.]
The thing that I have to say about SL that noone else has, is that for a chat program designed and supported by Europeans, is that it's not bad. What makes it bad is that there are EU Linden staff that don't know how to keep their personal feelings for Americans out of complaint investigations. On numerous investigations, I have been witness to complaints by Americans go unnoticed by Harry Linden, a European Linden. Here are two examples of two well known complaints that Linden Labs has failed to take notice of:
A complaint was submitted to Linden Labs when two German players invaded and griefed a private sim. The harrasements continued even despite the American owners' repeated complaints. After about four more months of this, Harry Linden had put the two American acccounts on hold until they provided a copy of their identification. After they did so, the American accounts were deleted and banned within two minutes after the information was posted.
An American man in SL named Bane Peccable had sent constant complaints against a Canadian female named Stephanie Steamweaver. His complaints consisted of his observations that she had violated the Linden TOS on multiple occasions, encouraged others to violate the Linden TOS, stalking, harrasement of all degrees, character defemation, and giving out real world information. Once again, it was Harry Linden who had taken the case. After putting Bane's account on hold until he provided a copy of his identification. Once again, this was done, and within minutes deleted and banned Bane's account. Why? Because his identification identified him as an American.
So, still think the Lindens handle things in a fair way? You might want to think again.
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gabrielg01
450 Comments
Virtual government
Hey you virtual zombies,
Why don't you make yourselves a virtual governing body, such as different branches of government: judiciary, legislature, law enforcement, central bank etc. etc.
Shouldn't the virtual world be self-governing? Why come back to the real world, with real law suits and real pain? To waste our real time and real resources?...
Just please stay there in your delusional Matrix, and don't bring your imaginary problems to real people. Thanks!
Reply
vikramgulati88
7 Comments
Re: Virtual government
Stuff like this shows how many people with excess time on their hands are out there. Its amazing!!!
Reply