How to Build a Better Metaverse

The metaverse, you may have heard, is the next big thing: an ever-present social cyberspace in which people—or their digital avatars—will work, hang out, and shop.

As it happens, this was also the next big thing in 2003. That’s when Philip Rosedale and his then-company Linden Lab launched Second Life, an immersive digital platform in which users can build worlds, create art, and buy and sell digital goods. After a spike of interest, Second Life faded into the background of internet culture, but it has maintained a loyal following of people who for whatever reason prefer its virtual reality to their own meatspace.

In many ways, the metaverse being pitched by Facebook—er, Meta—and other companies isn’t so different from Second Life. And yet Rosedale’s creation never came close to reaching the world-conquering scale that gets the likes of Mark Zuckerberg out of bed in the morning. What could make this time different?

Rosedale, who went on to found the spatial audio company High Fidelity, recently returned to Linden Lab as a strategic advisor as the company looks to leverage its early claim on virtual existence. He spoke to WIRED about how to avoid a dystopian metaverse, the true value of purely digital goods, and why VR headsets suck. The interview has been condensed and lightly edited.

WIRED: We’re talking about the “metaverse” because Mark Zuckerberg started talking about it. Facebook, now rebranded Meta, makes all of its money from advertising. Is it inevitable that the more time people spend in virtual worlds, the more their attention is going to be tracked and monetized through advertising?

Philip Rosedale: If Facebook is successful at building a metaverse with behavioral ad targeting, it’s just a very, very bad outcome. But it’s not inevitable at all. I’ve been saying this to everybody that will listen: Second Life makes more per person who uses it, per year, than YouTube or Facebook does. Second Life is free for basic access, just like Facebook or Gmail or YouTube. But the way Second Life makes money is through fees.

We didn’t really have the advertising business as a temptation when we were building Second Life, which I started doing in 1999. That was before Google introduced the world to the idea of this crazy ad auction market. So Second Life makes some of its money from charging people what’s basically a property tax if they choose to own land in Second Life. And then the rest of its money it makes from small fees on transactions. So if somebody sells an NFT, if somebody sells digital goods to somebody else through the Second Life marketplace, there’s a small fee that Second Life charges the seller.

You say NFT, but you’re not talking about something relying on a blockchain, correct?

Correct. Every “primitive” in Second Life, which are the atoms from which things are made, has a stamp on it, not in a blockchain but in a public database. And that information contains who created it, who presently owns it, and, if it’s for sale, what the price is and what you’ll be able to do with it once you buy it. So it’s very, very similar to the metadata associated with an address on a blockchain. But we store it in a central database, so people have to trust that Linden Lab is going to keep that database up to date.