Interview Two – LukeConnell Vandeverre, World Stock Exchange

In April this year we completed our first interview with WSE CEO, LukeConnell Vandeverre. The response to that interview was large and at time vehement. With the events of recent weeks at WSE, it was an opportune time to give Australia-based Vandeverre to put his side of the story on the the alleged insider theft, ISE as a competitor and future plans:


Lowell Cremorne: So – it’s been a big couple of week for you yes?

LukeConnell Vandeverre:Very. Most of the time i’ve just been focused on organising WSE 3.0.

Lowell Cremorne: Tell me a little about WSE 3.0.

LukeConnell Vandeverre: Sure, it’s the very latest platform we are using for the World Stock Exchange and is an integral part of our strategy moving forward. It involved redeveloping much of the web application and included changes to the trading room, orders, dividend system, rollbacks, IPOs, secondary offers etc. Any part of the site that involved the Linden currency had to be edited to now use and accept the World Internet Currency as well.

Lowell Cremorne: It’s now fully live?

LukeConnell Vandeverre:Yes

Lowell Cremorne: So while you’ve been trying to get that happening you had the theft occur, which has been fairly widely reported – what’s your take on it now?

LukeConnell Vandeverre: Yes, we were hit with the unethical theft from a former employee who used their inside knowledge of our system to make false deposits so they could then withdraw the real lindens from Wse Huet the avatar which holds all WSE linden dollars. It was widely known that the WSE was about to implement Risk API, SSL security, new ATM’s and the World Internet Currency, so there is almost no doubt the avatar tried to take advantage of their knowledge before they no longer could.

We were going to close down the WSE a few days after it happened anyway, so once I realised that there was an avatar called Mindo Pinion who had not used the WSE before but made 2 large deposits and 2 large withdrawals, I investigated the transactions and then realised it was false and immediately closed the WSE a few days early to begin an investigation. I was not going to make any official statement until we have established what exactly happened, how and by who. After discussing it with colleagues we decided that it might be an inside job so I reviewed the accounts of the 3 avatars who had knowledge of the ATM. That’s when I identified that Thurston Hallard was involved and it was likely this avatar that developed the system to make false deposits. I approached Thurston asking if he had identified a bug and could he please return the Lindens but he wouldn’t reply. I had a colleague approach him at the same time to see if he was just ignoring me and it turned out he was. He had been caught in the act and clearly had no idea what to say. I made it clear to people around me that I was investigating it and I had provided details of my initial findings to them.

Approximately 5 hours before I noticed the large withdrawal which led to me realising we’d been hacked, I had been approached by Zee Linden and he congratulated me on the WSE. It was unfortunate that this negative event occured just hours after my first direct form of communication from senior management of Linden Lab. I had no choice but to use my new communication channel and to inform Zee of the situation and I simply asked them to investigate and that although they are not obligated to do anything I’d appreciate it if they were able to recover the Lindens as those Lindens were from hundreds of users. He said they would look into it.

I then received a threat from Thurston 1 day before Linden Lab froze his account along with any Alts he had after it must have been made clear to Linden Lab that he had the Alt accounts which I’d mentioned to them. Thurston’s threat was that he would go to the press and make WSE look bad that we were able to be hacked. 24 hours after it was apparent that LL had locked his avatar and alts, the avatar Mystik Boucher, who was a strong supporter of the WSE and had no apparent motive or reason not to support the WSE, decided to approach whoever possible and to tell make many different allegations about the WSE which clearly showed malicious intent and that were designed to make the WSE look bad and to have a negative impact on the WSE.

These actions fit with the threat made by Thurston 24-48 hours before Mystik’s actions. Mystik claimed that LL had locked her account also, so I followed suit and locked her WSE account until I had been informed by LL that there was no connection between Mystik and Thruston, however Mystik had clearly breached WSE Terms and as a result we were going to delist her business from the WSE. After receiving many threats and to put an end to her actions I agreed that I would unlock Mystiks WSE account however just prior to doing this I got a gut feeling that the avatars might be linked, so I did an audit of Mystik’s transaction history and that’s when I found the false deposits in Mystiks account that matched up with the actions of Thurstons account. These were the only accounts with false deposits on the dates in question. I then made it clear that we would allow Mystik 30 minutes to take a copy of the MDS shareholder list and that she was being delisted from WSE and the avatar WSE account would be closed. All shareholders of MDS were to be the full responsibility of Mystik. We also dropped a notecard version of the MDS shareholder list on Mystiks avatar.

Lowell Cremorne: What was the impact of this incident on WSE in the following days?

LukeConnell Vandeverre:The total false deposits were approximately 3.4 million Lindens and the total withdrawals from false deposits worked out to around 2.8 million Lindens.

Lowell Cremorne: And what was the impact on confidence amongst companies listing with WSE?

LukeConnell Vandeverre: They are fine. Most of the companies to leave the WSE were IPO’s that were severely undersubscribed and were facing a rollback by WSE and companies that were on the official list who were facing delisting due to breaches of the WSE terms. There were 3 others who left due to either having their avatar account locked for investigations and one left without clear reason.

The Lindens that were taken did impact the ability for the virtual business of Hope Capital Ltd to turn a profit for the quarter however the WSE is operational and stable. We have achieved our 5,800th customer 5 minutes ago, of course some of the new accounts will be avatars who have created another account via the website independent to Second Life.


Lowell Cremorne: So for you it’s business as usual? You’re confident of ongoing growth?

LukeConnell Vandeverre: Yes, it’s business as usual now, however now that we have finally completed the integration of the World Internet Currency into the WSE we are reviewing all businesses on the WSE to ensure they are adhering to the WSE terms, organising IPO’s and amending the Listing Rules and Constitution to be clearer for virtual CEOs who may not understand some of the terminology. Over the coming months we will hold a major advertising campaign for the World Stock Exchange in the Melbourne and Sydney print media promoting the WSE as the world’s leading Stock Market Game where users can have fun, learn and potentially profit.

Lowell Cremorne: That leads to my next question – when we first spoke in April you were at great pains to emphasise that WSE is a ‘game’ and that it needed to be treated accordingly. Do you still feel that way?

LukeConnell Vandeverre: Definitely, however it has reached a cross point from being an experiment in an untested medium and has now evolved into a fictional stock market game that can be played by users all over the world without the need to use or have Second Life. This will attract lots of new users and it will bring lots of capital into the market that will help virtual businesses start, expand and develop while increasing the demand for shares in virtual companies across the WSE which will result in increased share prices.

Lowell Cremorne: You mean the website WSE Live? As far as it being a game though – how do you deal with the issue that Lindens can be cashed out for US dollars and hence in theory be taxed?

LukeConnell Vandeverre: Lindens are a fictional currency (imaginary currency, not real) – they hold no value. The licensed right to use the fictional currency has a value which is determined based on the developed exchange rate. Fictional currencies are much like game tokens, it only holds a value while people want to buy the right to use them. If a user buys a product e.g. the licensed right to use a fictional currency and then they sell that product to someone else in exchange for a real currency then that was a transaction of a product. Governments may one day want to charge something like Capital Gains tax on fictional currency transactions however any income generated from the sale of the product as with any product is taxed in most countries as personal income unless that product was sold by a company. Fictional Currency holds no value and is owned by the issuer of the licensed right to use that fictional currency. I’d encourage users to read the Terms of Service from any service provider before they agree to use any services.

Lowell Cremorne: But even if the majority of people who use WSE agree they are just playing with tokens – most people treat it more seriously than that given they’ve spent their own money buying those tokens. What I’m getting at, is that there is regular criticism of your stance of WSE being a game when plainly some people see it as an option to make money.

LukeConnell Vandeverre: Well, it is what the operator of the service says it is and if they agree to use a service that is up to them. If they agree to buy the right to use a fictional currency then they need to understand that they do not own the currency they are using and that they only have the right to use it at the issuers discretion. When a user proceeds to use the and deposits a fictional currency into the WSE, they are agreeing to our Terms of Service and therefore they agree that they understand nothing on the WSE holds any real or legal value and that it is all fictional and that it is not a real investment opportunity. The WSE is for edcuational and entertainment purposes only and at the moment there is demand for the fictional currencies so a user has the potential to increase the amount of fictional currency under their control and as a result they can sell the license right to use that currency for potentially more real currency than they initially paid.

If users want to make a legally recognised investment they should talk to a financial advisor or investment professional to determine what investment opportunities there are and what risks are involved.

Lowell Cremorne: One thing that’s certainly changed in the past 2 weeks is the growth for the ISE which means WSE’s dominance is diminished – is there room in SL for two stock exchanges?

LukeConnell Vandeverre:Not at all – over 95% of all Second Life residents using a virtual stock market started at the WSE and in majority of the cases still continue to use the WSE. Residents have been forced by the CEO’s of companies they have shares in, to trade their shares on the other exchanges. Most of the residents who are shareholders in companies that moved to the startup exchanges are unhappy about the move as it limits their ability to sell the shares they own and also the shareholders are well aware that the markets they were forced to use lack brand awareness, exposure and have far less functionality, credibility, liquidity and stability.

Lowell Cremorne: So you’re saying WSE’s dominance is likely to continue? Is there any likelihood of a merger between WSE and ISE?

LukeConnell Vandeverre:Definitely. There is no need for me to deal with the start up exchanges as they have the companies listed that WSE doesn’t want, along with the fact most of their customers already use the WSE. There is no motivation for the WSE to acquire or merge with a startup exchange that will not bring any value or growth to the WSE. Eventually those startup exchanges will run out of liquidity while the WSE continues to grow and improve which will ultimately result in the financial collapse of those exchanges.

Lowell Cremorne: One of the things ISE are being lauded for are their risk management protocols and processes – would you say WSE still has further work to do in that area?

LukeConnell Vandeverre:The WSE is constantly growing and improving, however it has up to now been focused on functionality rather than enforcing the rules and regulations. We have achieved the functionality we have been working so hard to provide and we are now going to focus on Education and Regulation. The WSE will not provide a fraud insurance fund as we don’t see any point in penalising IPO’s by taking their much needed capital in order to return shareholders 1% of their investment should the virtual business collapse, breach terms or commit ethics fraud which results in the business being delisted. If I invest 100 Lindens because I believe in a business then I dont want 1 or 2 Lindens returned to me from a fund as I took the risk when I invested and the 1 or 2 Lindens isn’t going to help me at all.

Lowell Cremorne: Is there anything in particular about ISE that you admire or find interesting?

LukeConnell Vandeverre: No, the other startup exchanges are simply a poor attempt to try and copy the WSE with what recources they have available to them along with using questionable tactics to acquire customers in order to try and gain a share of the potential fictional currency profits that come from the trading commissions.

Lowell Cremorne: It’d be fair to say both WSE and yourself personally have received a lot of criticism – why do you think that is, and have you taken any criticisms on board?

LukeConnell Vandeverre: The World Stock Exchange, as with Second Life, are emerging services that are constantly growing and evolving and there will always be a loud small minority who will make it their business to cause panic, create rumours and to complain about either service issues or features that are not yet available. There are always things we can do to improve and we will always continue to do so and take on board any feedback, however the majoirty of customers understand that this is new and emerging which results in upgrades, downtime, bugs etc. There will also be a small miniority who with malicious intent will make every effort to try and sabotage great ideas, services and visions such as Second Life and the World Stock Exchange.

Lowell Cremorne: Any real-life CEO will tell you their success depends on a cohesive, well-rounded senior management team. Do you have that?

LukeConnell Vandeverre:This is Second Life, businesses are managed by a controlling avatar – in this case it is me. However, I’m confident in my abilities to bring the world’s leading stock market game into a worldwide phenomenon that will encourage the masses to begin taking an interest in the virtual worlds such as Second Life, which encourage creativity and social interaction, investments and the stock market rather than focusing on debt and depreciating assets.

Lowell Cremorne: So do you have anyone you trust as a deputy / second-in-charge?

LukeConnell Vandeverre: Yes, my good friend in real life Jules Hyde aka Julio Koltai in Second Life, is now my Chief Operating Officer and is here to assist me in the management of the World Stock Exchange. His partcipation provides the market with the security of knowing that should I be out of action due to other commitments, unwillingly fall ill, or worse, the World Stock Exchange will still be fully operational under the management of Jules Hyde.

Lowell Cremorne: You’re not concerned that the definition of gambling may be expanded to incorporate ‘games’ like WSE?

LukeConnell Vandeverre: This is not gambling, as it is not a game that relies on chance or random number generation to determine a winner or on the outcome of real-life sporting events. It is not a casino game with odds, it is a fictional stock market built on virtual businesses that operate using a fictional currency and which has a virtual trading and investment community. It does however involve risk on a virtual level that could result in the loss of fictional currency, bonds, interest or shares that were managed by an avatar. Stock Markets are not gambling or a casino. They are a market that exchanges securities, real or fictional where the value of the securities is determined by many factors from regulation, policies, supply and demand, market sentiment, management decisions and corporate activities of real or virtual companies and economies.

Lowell Cremorne: So you’re not concerned then.

LukeConnell Vandeverre: No. There will of course be people who will try and create concern where there is none and that will always happen. We just have to move on.

Lowell Cremorne: What are your objectives over the coming six months or so?

LukeConnell Vandeverre: Over the next 6 to 12 months we aim to see the World Stock Exchange operating a fictional market for virtual business with over 50,000 users and a real market for Nano Caps e.g. startup and emerging companies with market capitalisations of less than $50 million US dollars that will require real laws, rules and regulations using a highly secure platform.

Lowell Cremorne: So a ten-fold increase in users in the next year. Can you explain the Nano Caps?

LukeConnell Vandeverre: What do you need to know?

Lowell Cremorne: Well, do you mean you’ll be offering it for RL companies?

LukeConnell Vandeverre: Yes, it will be the real life version of the World Stock Exchange with a global brand. I expect it will be the killer app of the finance world.

Lowell Cremorne: What do companies gain by doing that – is it a sort of first-step exchange for startups?

LukeConnell Vandeverre: Companies can avoid dealing with business angels, seed investors, venture capitalists and private equity firms who demand a large share of equity in the business to offset the the risk involved resulting from being one of few investors in the business. Companies will be able to raise capital from a large investment community and thereby spread the risk across lots of investors resulting in less exposure for each individual investor while also having an opportunity to gain a possible premium on their companies value.

Lowell Cremorne: Are you seeking finance to start that up?

LukeConnell Vandeverre: No, we have already started the regulatory process and we will fund the real life version with our own capital.

Tasha’s Place – aussie art, gifts and clothes

Tasha’s place is a new addition to aussie-owned shops in SL, but it’s a little different to others: it’s a non-profit shop. All profits are donated to an organisation devoted to progressing native title and reconciliation. In Tasha’s own words:

“I created this little shop (with help from my friend Justy) about six weeks ago. Initially it was for the challenge of seeing if I could find a suitable plot of land, building a shop and making items for sale. All these things were great fun and learning experiences.

I’m Australian and I love to have Australian art around me so the idea of having that as a theme for the shop was appealing. I wanted to make pictures and simple clothes using the patterns and schemes that I love. Many of these patterns you can see in the shop are from Aboriginal artists and that’s why I run the shop as a not-for-profit business with profits donated to the community organisation: Australians for Native Title and Reconciliation (ANTAR). It’s my attempt to promote Aussie art and images while trying not to rip people off through the greyness of copyright in SL.”


“My best selling items are Unisex T-shirts with Aboriginal and Australian flag designs (come by and get one free one at the entrance!), vegemite boxes you can use as a seat and a decorative didgeridoo stand I made. About half of my customers are Australians looking for some familiar things that they can have in their SL. The rest of course are from all over the world. It’s a nice feeling to think that some of my things are dotted about in SL and I hope that people get pleasure from them as I do. I keep prices as low as possible and there’s nothing in the shop that costs more than $L89.”

Check it out in-world

Interview – the SLCN TV Team – Part 2

We finish up our Q&A with the effusive SLCN TV team with a discussion on SL competitors and what’s inspirational about SL. Part 1 of the interview can be found here


Lowell: So what do you see as the biggest challenges for the SL platform in the coming 12 months?

Starr: Living up to the inflated expectation of the broader population as they realise what cool fun they are missing out on… and leap in without true commitment to it.

Wiz: The biggest challenge for Linden Labs is to stay focused on their mission. I believe they have done a remarkable job doing that already. In fact, I am stunned at how focused they have been despite what must be an enormous industry distraction.

Starr: And all the other scandals and crisis’ happening… they have become masters of the universe, and hey, that’s a busy job.

Lowell: What are your thoughts on potential competitors like Project Outback?

Wiz: The “secret” that makes Second Life work is the economy and the intellectual property model. Many people, like Project Outback, have the mistaken impression that “it’s about technology”, but it’s not. It’s about people and their possessions and their world. That is the challenge for any competitor, and Linden Labs won’t have too much to worry about until somebody undertands how to quickly escalate the creation of a vibrant virtual society.

Starr: Peer to peer is an exciting thing and if virtual worlds can run as smoothly as the full screen video for Joost, then a p2p system sounds great…. but I agree with Wiz, the challenge will be filling it with interesting people and things, because that is going to win over a better resolution suntan.

Lowell: But you’d agree that if a competitor manages to create a vibrant community whilst offering much larger concurrency per area that they’re likely to cause some concern for SL?

Wiz: True, technology supports such a society, and makes it possible. But, when you look at SL, it’s amazing the “trivial” features related to ownership, IP, permissions, that, if missing, would cause the economy to collapse. There are fundamental problems with “larger concurrency per area” that are not easy for anyone to solve. For example, no matter how much money and technology you throw at it, there is a limit to how many people you can throw into a phone booth. There are limits, based upon graphic complexity and “activity on your screen” to how many people you can actually manage in one space. I think the “limits per area”, while too low now, are not a “make or break” feature for competing with Linden Labs.

Lowell: True – but whether it’s SL or a competitor, being able to have more than 100 people in an area is likely to be an attractive proposition.

Wiz: I think the biggest “competitor” will come from those who have the vision to embrace the LL open source viewer, and create stunning and usable alternative grids. It’s a lot like the web. Embracing HTTP as a standard was essential. For virtual worlds we need a standard. and the LL open source viewer is light years ahead of any other attempt.

Lowell: Do you think that SL’s dominance now makes it likely to remain that way?

Wiz: Standards-based virtual worlds are the “holy grail” that will cause adoption to spread like lightning.

Lowell: And open source is much more likely to deliver that. Is SLCN set up to service other virtual worlds?

Wiz: Well, a STANDARD will deliver that. There is nothing even remotely close to a standard. There is the second life open source viewer in first place. Second place? Nobody. SLCN can provide virtual coverage of any virtual world. In fact, we sort of joke about the “Second Life Cable Network” name and figure that some day people will say …. “SLCN, what does that stand for?” and have no idea

Lowell: Have you done any non-SL virtual work to date?

Wiz: We don’t see any other virtual worlds as even marginally important right now.

Lowell: Why is that?

Wiz: No other virtual world allows content creation even close to what SL offers. Content creation is what CREATES people’s virtual identity, otherwise they are just “going to a virtual movie” and have no participation. People’s stories are derived from their participation. We will wait and see whether other environments accomplish that and will not hesitate to cover such worlds when they do. Sure there are “niche worlds” like World of Warcraft and we are considering whether WoW “events and news” may be potentially interesting, but that is, in my opinion (you may think me crazy) a small market.

Lowell: I think you MAY be crazy on it being a small market.

Wiz: WoW isn’t a small market…. the WoW market who ALSO will watch a virtual TV show is a small market.

Lowell: But I’d imagine the huge cohort of heavy users would jump at a virtual TV show on WoW – nothing to back that up of course.

Starr: Well there was that WoW clip on Youtube that got squillions of hits about the funeral massacre. Not wanting to contradict you Wiz! hehe

Wiz: %population-who-gets-curious-when-they-hear-the-words-second-life > %population-who-gets-curious-when-they-hear-worlds-of-warcraft …. quickest summary I can give

Starr: I think that a lot of SL users where users of the Sims online and other virtual worlds and they are looking for the next level of sophistication, which SL offers. People love the making, the selling and the interactions

Lowell: So linking to that – what events / areas in SL have excited you the most?

Texas: I’m inspired by some of the people we have met in SL. The patience and time they have shown us from day one have just blown me away. These people are creative with their imaginations, their time and their hearts.

Wiz: You’ll laugh when i say this, but somehow, SLCN has a “mind expanding” effect on people. I am very excited when I see that effect. For example…people who have been working hard to build “something they find important” in Second Life, they work, they amass friends, they blog about it, they love it. Then, they participate in an event where their “loved thing” is brodcast on SLCN, in-world maybe, to other sims, or archived so tht experience is “captured” so they can tell their story better with pictures. It opens their minds to new possiibilities, the world seems bigger. Suddenly what seemed SO hard seems easier because they can share the experience with others not in-world. The Best Practices educators were the best example of that, and I am inspired by every one of them.

Starr: I get inspired by seeing people jump up and perform when the camera on them, just like in real life. People have such avvie-empathy, they want to be up on the big screen as much as the next avvie. I do think media plays an important role in-world like it does “out” here.

Wiz: Absolutely. One analogy I make alot is that Second Life is like a “new country” being born. It needs a cable network to document what happens, to tell the story, to share it. It seems obvious to me.

Interview – the SLCN TV Team – Part 1

SLCN TV are SL’s only native cable TV offering and they’re Australian to boot. Wiz Nordberg (Gary Wisniewski), Starr Sonic (Keren Flavell) and Texas Timtam (Grace Roberts) agreed to an in-depth chat and here’s part one:

Lowell: Could you give a potted history of how the three of you decided to put SLCN together.

Wiz: Well, it really started with us doing the Aussie Music Party back in March with Austrade. In our “prior lives”, Texas and I were responsible for some of the largest music webcasts ever in australia, did BDO four years in a row for Telstra, Tropfest, the Mushroom 25th concert…. all were very big budget things – over 30 crew on the M25 concert, so we were used to doing “webcasts like television”. The moment Texas decided to do the music party, the obvious thing to me was that it should be “televised on the web”.

Wiz Nordberg

Lowell: So SL-based events were an obvious complement given your RL experience?

Wiz: In April or so, we did some prototype work, and then I set up this screen in SL at a friends place and the three of them (SL friends from the USA) were almost transfixed by what they saw…. they were dancing and looking at themselves on the screen going “omg look, we’re on TV!”. That night, i registered

Lowell: That’s probably a good point to ask if you can easily summarise how you make SLCN work technically.

Wiz: Almost exactly like a RL television station does a RL O.B (Outside Broadcast). If you ever watch “on location news”, there’s a van, with vision mixers, scan converters, etc. We use the same kind of equipment and don’t use any of the SL machinima tools.

Lowell: Well, for SLOz readers who don’t have TV industry experience – roughly how are things set up? It’s all third party non-SL tools?

Wiz: We use camera machines, connected to scan converters (a high quality way to capture the motion), then hook it up to a vision mixer, which has super and chromakey capability, as well as title super capability, so one person sits at the “vision desk” switching from camera to camera, and we have camera operators…. also audio mixdown for various sources. It’s frighteningly conventional. In fact, if instead of SL cameras we just had two DV cameras, our results would look a lot like what you see on CNN or Channel 7 using the same kind of equipment.

Starr: The set up has a lot to do with the live production requirements and we have learned to apply traditional film making methology but also working within the constraints of being in a virtual world.

Wiz: Right, there are LOTS of little tweaks in production to deal with the fact that the people “in the show” aren’t in the same room most of the time

Texas: And of course we have to also manage getting voice into SL

Starr: Also the actors are in two places – the operator and the audio content, they have to mesh together and that is a challenge! You think downloading a new client is a challenge hehe.

Lowell: So how do you synch sound etc and what applications do you use?

Wiz: We built a system called Soundreach which is our own design. It’s what Bruce Willis used to speak into Second Life, as well as almost all the voice you hear on any of our shows.

Starr: It’s a bit matrix like when you think about it :0)

Starr Sonic

Lowell: Can you easily summarise what Soundreach does?

Wiz: It’s a telephone-to-mixing-desk-to-Second-Life bridge which allows us both to get a split of the sound to our mixing desk, as well as feed the sound into Second Life from regular telephones. People use it inworld now independently of SLCN.

Starr: It worked for Frank Miller to call in

Texas: It makes the production of talk shows and interview news vox pops really much more like RL TV.

Lowell: So for example in the Bruce Willis gig you had him via phone through your mixing desk then into SL

Wiz: Well, it’s more like this…

Starr: We barely thought he was going to cope with dialling a number on a telephone and were working out how we could call him with the system!

Wiz: Bruce (and others) use land lines -> servers in the USA -> part goes directly in-world as an audio stream -> part feeds remotely to our mixing desk. The mixing desk is actually optional. You can call a Soundreach number and “hook it up” to a land parcel independently of our mixing desk and SLCN studio.

Lowell: So hookup to the parcel occurs normally via the parcel options you enter the streaming address etc?

Wiz: Yep. At its simplest, Soundreach is a telephone -> shoutcast technology, except there is some audio processing and splitting in the middle to allow things like SLCN to get a feed directly

Lowell: The implementation of voice in SL will change the face of things – how’s it going to help and/or impede what you’re trying to achieve?

Wiz: Well, it will help A LOT if it is adopted widely by Second Lifers. We are VERY much looking forward to it

Lowell: What do you think will prevent widespread adoption – lag etc?

Wiz: Providing the technology “works” (which I believe it will), the two factors which will prevent adoption is psychology and the inability of people to actually get their computers to use a microphone and headphones properly (which is not to be underestimated). There is of course a lot of controversy about voice

Lowell: What do you believe is causing controversy?

Wiz: The nature of “having a virtual self” for many people includes changing the way they are perceived, or “remaking themselves” in a more idealised way. Voice is a very big giveaway about ones personality without even worrying about the cross-gender issues. I know myself that i am perceived VERY differently inworld without voice than I am when I speak to people.

Lowell: Very true – though I’m expecting pitch-shifting apps are already in development for SL use.

Starr: I think that socialisation into the land of voice is going to be a rocky one. There has been a certain peacefulness about being in-world that is going to change… I was in the voice beta yesterday and hung out with about 8 people.. and you are essentially talking over each other the whole time. A group needs to be well coordinated to communicate easily. So we all have a lot to learn before it becomes graceful.

Wiz: I hope that, for the most part, people overcome their hesitancy and voice enjoys widespread use. We would love to simply “walk up to somebody on the street” and do a great interview.

Lowell: That’s an obvious application for voice for sure – if you could do a vox pop tomorrow in SL, who would you choose?

Starr: The only trick is that you need to have lined up the interviewees, because it does take a bit of tweaking to get someone online with us as everyone has a different set-up. Thats not a technical issue, its more about the end person, have they got access to a phone sometimes

Lowell: True – so who would you choose for your spontaneous first vox pop?

Wiz: I heard that question the first time LOL. I don’t actually have an answer. I think the person with the most interesting story may not be famous, or anybody who I know now. You have to search for people who have something to say, and the best vox pops are from people who are in the middle of something important or have an intersting story to tell. So i can’t actually say who it would be, or where.

Texas Timtam

Lowell: A different tack now – how have you found the reaction of RL businesses and individuals to your work in SL?

Wiz: Frankly, we have been blown away by what people have been saying.

Starr: Well we fondly remember when we were at the 14 Cows exhibition and we got a shout out WELCOME SLCN

Wiz: In probably more than half of the comments on blogs and other places, the words SLCN are accompanied by adjectives like “amazing”. I’m not sure how much credit we can take for any “innovation”. I think a lot of people are simply not expecting it. One thing we do which is different is we are very dedicated to being a TV network FOR SECOND LIFERS. We are trying to seek out things which matter to virtual people, in their virtual spaces.

Starr: The organisers of the Best Practises in Education conference loved us

Wiz: If you look at 90% of our content, it had a big impact on the people who participated. That’s why so many people have made such positive comments.

Lowell: I’m also thinking of people who don’t have exposure to SL at all – how do you explain what you do? It also links to any plans you may have for growth – is it still difficult to convince potential investors on the role virtual worlds may play in the future?

Starr: The only way to explain is to show.

Lowell: Agree – but a lot of people when you first show them just see it as ‘The Sims’ – how do you overcome that initial scepticism?

Wiz: We don’t have to do much convincing. there are ten thousand intelligent people at least out there preaching, educating, showing the world. it will happen, and people will be convinced. It is inevitable

Starr: We showed the producers of Die Hard how a virtual press conference is staged, through a live stream directly from the event taking place inside Second Life where where most of them would not be a SL resident.

Wiz: I think there is an “ah-ha” experience that happens when people engage in Second Life. It doesn’t happen for everybody, but it happens for enough people that the skepticism will dissolve over the next year or two.

Starr: The same thing happened with the world wide web.

Wiz: Virual Bacon, at the “best practices”, he did an entire session on “how to convince people that second life is a good idea”. His conclusion, after a LONG time applying methodical approaches was that you CANNOT convince people. The only way they will be convinced is to experience it.

Lowell: So what is the plan for SLCN in coming months?

Starr: We have several shows lined up to roll out over the next month. These include talk shows, sports shows, a book show and a regular SLCN feature series called The Inside View

Lowell: In regard to Inside View can you explain its format?

Starr: It will be a show revealing issues relevant to the people in SL, a dig under the covers to find out what is going on. Around half hour length and airing on Sunday evenings.

Lowell: So almost a current affairs show?

Wiz: I suppose the model for “The Inside View” is shows like 60 Minutes, except with a bit more “leeway”.

Starr: Yes, with a bit more of a foreign correspondent feel.

Wiz: We want to not just report on someting as “here are the facts”, but rather get into a discussion with people about something very relevant in Second Life, things such as voice, how brands are affecting them. Always with a total 100% focus on the “virtual person” and their changing experiences

Starr: Wiz will do the introduction to each show…. then it will feature guest speakers and look into the many spaces of Second Life to show what is happening.

Wiz: We also have 1 show currently readying for production (tonight live with paisley beebe) as well as a news show about to be signed and are in final negotations with 2 other shows which will probably go into production. plus we are talking to at least 10 to 15 “interested parties” and working with them to get to the “final negotiation” stage.

Lowell: Are you getting many approaches from current or potential brands in SL hoping for some free promo? i.e. are you being treated like RL media by PR people yet?

Starr: Many people are submitting their events for inclusion in That S’Life, which is great.

Wiz: Hmmm, having never been RL media, it is hard to know how they are treated

Starr: Some businesses are starting to get machinima ads made and we are going to start playing some of those as part of our programming

Lowell: So there’s obviously a lot of interest etc – is SLCN a business model that’s making its existence independently viable in a financial sense?

Wiz: This is our job. It’s not a pasttime. Making it financially viable is essential, not optiona.l

Lowell: And are you achieving that goal?

Wiz: No way, not yet. we are at a very early stage and we are investing a lot of time and a lot of money. In fact, we have been hesitant to have “fake advertising” which we “give away” to people just to have advertisers

Lowell: Is SLCN the sort of business that may need external investment to get where it needs to go?

Wiz: We are going to be pitching to several investors over the next months. but we actually have put enough personal money (and money from our other businesses) into this to keep growing and producing show. When we pass the “8 regular shows per week” mark we will probably require some additional facilities, and we’re planning on that.

Lowell: So is it likely you’re going to need more people on your team? Should aussie SL’ers start polishing their CV’s?

Wiz: It is VERY likely

Lowell: If there were readers who wanted to let you know about their skills, how should they do it?

Wiz: info AT Seriously, I think it is amazing that we have been able to get to the TOP of even a niche US market, with good industry recognition, without really ever leaving South Melbourne.

Armory Island

If weapons are your thing, then Armory island may be worth adding to your landmark list. It’s owned by Australian Apollo Case. Apollo describes his island thus:

“Armory Island is Second Life’s largest virtual arms area with almost fifty independent exhibitors. There is a broad range of weapons, shields, clothing and gadgets for every avatar”.


An example of what’s on offer can be seen here:

Armory Island even has a motto: “Come for the guns, stay for the fun”

Check it out in-world

Interview – Gizzy Electricteeth (Kelly Daly), IBM

Gizzy Electricteeth (aka Kelly Daly) is another Australian in SL that has been a very active participant in a range of areas. As training and technology lead for IBM Australia in SL, she’s busy enough. On top of that she’s played a training role for Aussie residents, recently commencing the Prim School series on ABC Island which shows residents how to create objects in SL.


We caught up with Gizzy this week to find out a little more:

Lowell: Tell us a little about yourself – where did you grow up, get educated etc?

Gizzy: I was born in Adelaide, and got dragged kicking and screaming to Ballarat when I was 5 (apparently that’s too young to move out of home – I asked!!). My formative years were all spent there, up to and including my Bachelor degree in computer science from the University of Ballarat. It was here that I also started working for IBM part time while in the final year of that degree. Once my degree was complete I moved to Melbourne (still working for IBM), and started my masters at RMIT part time. This took a LOT more years than intended as part way into it I was enlisted to give tutorials and labs, and then later to be a replacement lecturer for several subjects when the usual lecturer was unavailable. This all culminated in lecturing my own web subject, emergency lecturing some database subjects, and continuing working giving labs and tutorials in most of the subjects which I had already completed. The result was my Masters took about 4 years longer than intended =)

I am owned by three completely loony cats – the youngest of which is named Linden (thanks to my fiance!!).

Lowell: Where have you worked prior to IBM?

Gizzy: I have been ten years now with IBM – prior to that were the usual round of part time uni jobs at random computer shops, pizza shops, etc 😉 And the RMIT thing (more “while at” than “prior to” =) )

Lowell: Can you describe for us your current role at IBM?

Gizzy: My role at the moment is training and tech lead in Second Life building projects, also research and rapid prototyping for potential SL projects. My role about a month ago was as a Linux Kernel developer.

Lowell: What are IBM’s objectives for their presence in SL? And where does the IBM Australian Development lab fit in?

Gizzy: We are researching and learning as much as we can on virtual worlds. I say virtual worlds here as we are not focussed solely on Second Life, but over a large range of products. IBM’s aim is to assist in making virtual worlds ready for general consumption for both business and home.

Earlier in the year, IBM’s CEO, Sam Palmisano, announced $100 million USD to be spent on research into ten key focus areas which were chosen through an “Innovation Jam”. Employees, family members and friends were all asked to submit ideas on how they think IBM could improve areas such as environment, work and life balance and health, technology, etc… Virtual worlds was one of the top areas of interest shown through this, and therefore was a part of this funding announcement. In fact, Sam made this announcement in the forbidden city, Beijing in real life AND Second Life simultaneously =)

The Australia Development Lab fits into this by being the Australian arm of the emerging business organisation created around virtual worlds as a result of Sam’s funding. We currently have a team of two people working full time in this area (myself included), and a whole host of others who volunteer their time to increase their knowledge in this arena (and to have fun – because they love it!)


Lowell: Can you tell us about some of the projects you’ve been involved in, including the Australian Open project?

Gizzy: I have been involved mostly in internal build projects such as IBM PartnerWorld, ADL, several client demos and a little with the Sears and Circuit City builds. And, of course, the Australian Open.

The Australian Open was the first large customer build that I have been involved with. We had a three person development team (myself on building, my Australian colleague on scripting, and a US based colleague on graphics – displaying the collaborative nature of working within Second Life 😉 ). Each of us assisted with all areas of the build, although for the majority of this project we kept to our defined roles, and that really seems to work well on larger scale projects. We had a live feed of ball positioning data coming from the IBM technical team onsite, which we could then manipulate into SecondLife coordinates and recreate the game on the tennis court in our island just a few seconds behind reality. Using this data we were able to determine where a player would need to be standing to hit the ball, and move a pose ball to this location so that we could have an avatar sitting on the pose ball and look to be playing the game of tennis. This provided people with a view of the ball coming at them as if they were the played on the court. Ever wanted to be Federer? We also had live data of all match information – scores from past and present matches on all courts throughout Melbourne Park, scheduling information, etc. These were able to be seen at all times on various score boards and match update centres throughout the island, and also via a heads up display that could be used from anywhere within SecondLife. The build itself took a great deal of detail from the real Rod Laver Arena and the surrounding grounds, right down to a virtual recreation of the tennis ball shaped Garden Square at the back of the arena. All of this build was based on photographs.

There is a YouTube demo of the Australian Open build here.

IBM as a whole has been involved in MANY more projects, and we have people from all over the world working on both internal (IBM) and external (customer) projects.

Lowell: What specifically about SL limits you achieving what you’d like to in projects?

Gizzy: I am VERY MUCH looking forward to learning how to use sculpted prims in Second Life =) And some better scripting!

Lowell: Have you had any involvement with other virtual worlds and if so which one/s?

Gizzy: Personally, I have not looked much further than Eve Online or World of Warcraft. I spend so much time inside of Second Life that I no longer seem to have a first! =)


Lowell: What excites you most about your work in SL?

Gizzy: At the moment the same thing that excited me about teaching at RMIT – seeing people grow and learn as a result of information that I can share with them =)

It is also exciting working with new technologies before they become mainline, working out what can or cannot be done with these technologies. It is a lot of fun =)

Lowell: Any predictons you’d like to make about SL development over the next year?

Gizzy: Not necessarily a prediction so much as a hope… Linden Labs have open sourced the client and there are rumours of the server to follow. With my Linux and Open Source/Open Standards background, I would truly love to see this come to light.

Lowell: Three favourite places you keep coming back to in SL?

Gizzy: DE Designs (my avatar is ALWAYS dressed in stuff from here!!)

The build of the Yankee Stadium by the Electric Sheep Company was very much an inspiration when we decided to do the Australian Open:

I don’t know that there is another single build that I keep returning to more than any other (apart from my own current projects through necessity ;)…

I love to look around at other pretty builds – places where the architects have ignored real world constraints and built for what works within SecondLife… Such as Text100 Island, ABN AMRO and almost any build by Dalian Hansen (he is TRULY an inspiration), Electric Sheep or Aimee Weber.

Sofia’s Furniture

Sofia Standish owns a furniture shop and also offers Australian homes for sale in a ‘Queenslander” style. I caught up with Sofia a few days ago and she was very excited about her business and has plans for further growth. The houses are certainly authentic replicas and it’ll be interesting to see how many ‘Queenslanders’ pop up around the place.


Check it out in-world

Interview – LukeConnell Vandeverre, World Stock Exchange

The World Stock Exchange (WSE) is a SL business that tends to garner a lot of attention. As the only stock exchange its role in the financial life of SL is significant. And like any institution involved in finance, contention is easy to find about that institution’s role in the broader community.

First, some context. Luke Connell is an Australian who is known as LukeConnell Vandeverre in-world. He is Managing Director of Hope Capital and runs WSE. Additionally, a virtual World Trade Centre (WTC) has been created, as reported by the Second Life Herald this week. The WTC project has generated a great deal of interest and controversy given the real-life events affecting the New York-based WTC.

We caught up with Luke Friday evening for an in-depth interview.


Lowell Cremorne: To start off, can you give a potted history of yourself?

LukeConnell Vandeverre: I grew up in the eastern suburbs of Melbourne, Australia. I left school at 14 years of age to become self educated after being told I wasn’t allowed to participate in the business and accounting classes due to my age. I spent most of the time from 14 – 18 years of age just finding my way around the world of business, the terms, key areas and reviewing many opportunites that were and still are in the market both nationally and globally.

Lowell Cremorne: So have you completed studies since then?

LukeConnell Vandeverre: I’m self educated with the information necessary to assist me in achieving my goals.

Lowell Cremorne: Ok, so how did you educate yourself in economics / finance / business? They’re not easy areas to pick up.

LukeConnell Vandeverre: I completed most of a university assignment on Ethics and Corporate Governance for a friend studying at RMIT and he said that the work got a D, which at first I thought meant bad but in actual fact it meant that my work got a distinction.

Lowell Cremorne: (laughs) True, it is a distinction. What did you learn about corporate governance from that? Given you’re running a stock exchange, corporate governance is pivotal – what model of governance are you using?

LukeConnell Vandeverre: There isn’t a model for governance, simply common sense and in an emerging market that has in many ways been developed from scratch by myself both morally and conceptually. It has many areas that need to be improved yet, but that can only happen with time as some changes require the assistance of third parties.

Lowell Cremorne: Ok fair enough – what sort of third parties do you envisage will need to play a role?

LukeConnell Vandeverre: Linden Research and myself will have to begin working closely to ensure that the market grows along with the Second Life economy while also minimising the risk of clear in-world fraud.

Lowell Cremorne: That’s the reason I asked about corporate governance – without a detailed approach from WSE aren’t Linden Labs going to be a little concerned on your ability to mitigate risk in regard to fraud?

LukeConnell Vandeverre: Obviously there will need to be a detailed plan however this is a new market and we are still watching the market to see what areas can be improved on in order to draft up the appropriate plan. This isn’t real life and it isn’t a real market and therefore the approach to minimising, preventing and tackling fraud has to be approached differently to real life.

Lowell Cremorne: How do you feel virtual fraud differs?

LukeConnell Vandeverre: Well for a start, fraud is deceit, trickery, or breach of confidence, perpetrated for profit or to gain some unfair or dishonest advantage in a virtual world using a fictional currency.

Lowell Cremorne: Yep for sure – what I’m interested in is your assertion that fraud is ‘different’ in SL – aside from the currency differences, wouldn’t fraud prevention methodology essentially be the same for a company? The reason I’m asking these questions is the central role WSE plays in regard to stock trading in SL – any company or investor will have concerns around fraud, risk mitigation, corporate governance etc and may have concerns that the only security is the claim of a ‘common sense’ approach.

LukeConnell Vandeverre: I have to stress that this cannot be taken too seriously by people as it is a fictional market with virtual companies built on avatars using a fictional currency and therefore the expectation of real life governance within a short time is not possible. It is the investors responsibility to decide what to do and don’t do with their Lindens.

Lowell Cremorne: But given the reporting today of the SL World Trade Centre deal you’ve done – you’re talking significant amounts of real money. And yes, investors do need to make their own decisions, but surely you’d agree there’s no basic security being offered by WSE around governance and the like?

LukeConnell Vandeverre: On the contrary i’m not taking any real world money. It’s Lindens. There is security – we have the WSE Listing Rules to minimise fraud and it has worked rather well, a WSE Constitution which oversees the obligations by companies and the shareholder rights and we have the Terms of Service which lays out the risks.

Lowell Cremorne: Well I won’t dwell on that point any longer then – can you tell me about the WTC deal? It sounds exciting.

LukeConnell Vandeverre: There’s nothing I can really say that wasn’t in the Hope Capital Report or the WTC Press Release. Would you have questions related to something not in there?

Lowell Cremorne: Well, the only one would be the quote from Shaun Altman around not being consulted on the HCL transaction in regard to the WTC – what would your response be to that?

LukeConnell Vandeverre: Shaun Altman did not need to be consulted on this transaction as it is the responsibility of management to make the executive decisions regarding all matters of the company. For example, upon paying Shaun Altman 12,500,000 shares in HCL for his share of the WSE, the existing shareholders at the time were also not consulted however there were no complaints, only support. The dilution of equity was far greater during that transaction than the small amount used to acquire the WTC Project. Shaun Altman didn’t like the WTC Project deal because it made the company less attractive to a potential buyer who decided not to purchase most of his shares after the deal in what was to be a transaction organised off market.

Lowell Cremorne: Ok – in both cases – in RL isn’t it fairly standard practice for the management of a company to at least inform stock holders (via the stock exchange or directly) of their intentions prior to such a large deal?

LukeConnell Vandeverre: The normal practice in RL is to follow the constitution and rules which Hope Capital did.

Lowell Cremorne: True, though the ASX for example has reporting requirements and while I’m no compliance expert, wouldn’t a large deal like that fall within reporting requirements? Let’s use the current QANTAS takeover as a parallel.

LukeConnell Vandeverre: There is no rules for the WSE saying that I had to make any announcements prior to the transaction.

Lowell Cremorne: I have no doubt WSE doesn’t have that rule, I was just interested in the RL / SL comparison and whether you felt that level of reporting would ideally occur.

LukeConnell Vandeverre: You can compare the ASX, SEC, ASIC or WSE however they are completely different and are setup to cater for different markets and environments. RL is RL and this is SL not real

Lowell Cremorne: Let’s move on – what do you hope to achieve in SL in the next year?

LukeConnell Vandeverre: I intend to continually improve the SL operations of the WSE and Hope Capital in order to provide a more realistic trading and regulatory environment that encourages continued growth of the WSE and SL economy through increased economic activity.

Lowell Cremorne: And the WTC project is likely to be Hope Capital’s main RL dollar earner?

LukeConnell Vandeverre: They are completely different investments in order to help Hope Capital Ltd achieve its objectives. The WSE is a far more profitable business than the WTC. Profit isn’t the main focus for the World Trade Centers but rather a strategic acquistion.

Lowell Cremorne: And the strategy behind the acquuisition is?

LukeConnell Vandeverre: The strategy is to drive economic growth and awareness of SL.


Lowell Cremorne: A totally different question – have you had mostly support, resistance or a mix of both to your operation from businesses in SL?

LukeConnell Vandeverre: I’m confident that over 90% of HCL shareholders support my operations and I have many friends and associates throughout SL that also support our operations.

Lowell Cremorne: Do you get many ‘knockers’ in your dealings?

LukeConnell Vandeverre: The major reason for the significan’t decline in the HCL share price is a direct result of the large number of HCL shares sold by Shaun Altman over the past 2-3 weeks. Do you mean am I getting approached with business opportunities in my position?

Lowell Cremorne: I haven’t actually followed the share price, it was more a general question for any business person with a monopoly on how much dissent you receive in-world.

LukeConnell Vandeverre: In my opinion it’s in the best interests of the SL economy to have one serious virtual exchange right now. There will also be a small minority with loud voices who will work against the major corporation in any economy, except in SL they can get their message to more people within a short time. It’s also easier for someone with malicious intent to make false or misleading allegations about an SL company with the aim to have a negative impact on the share price and market sentiment.

Lowell Cremorne: Have you had issues with that sort of thing?

LukeConnell Vandeverre: most prominent individuals, avatars or major companies in RL or SL have such issues.

Lowell Cremorne: True – what would you say to (a) a potential investor and (b) a company interested in listing to convince them they’re making a sound investment decision. Particularly for the investor, how do they know the listed companies have been vetted and actually exist?

LukeConnell Vandeverre: I don’t tell anyone how to invest full stop, I can only speak for myself and the operations I run directly. The investors know exactly the same information as me, what’s freely available in the Avatar profile, what the CEO tells us and what’s registered in the SL groups.

Lowell Cremorne: That’s the core of my question – does WSE do any vetting of companies to determine their abiity to generate returns for shareholders? I know you have an application process etcetera..

LukeConnell Vandeverre: The WSE doesn’t make the decisions of which company is or isn’t a good investment, thats up to the market to decide. The WSE makes sure that companies listed meet the listing rules.

Lowell Cremorne: Ok – I was just getting at the issue of a new investor having faith in the WSE itself – if you end up with a market listing full of unviable companies, doesn’t that affect the reputation of the WSE?

LukeConnell Vandeverre: Yes, however the IPO process will remove most of those companies that people don’t want to invest in 🙂 And I won’t approve IPO applications if there isn’t sufficient information in the application. Determining who is and isn’t a viable business is something that each investor decides, not the WSE as all investors have their own opinions.

Check out WSE in-world

Profile: Bella Dutton

Bella Dutton is an Aussie SL resident who has a very busy second life split between her involvement with QT Labs and her own clothing line, BDD (Bella Dutton Designs). Add to this Bella’s role as a member of the production crew for the band Space Junkies and a raft of other building and shop projects and Bella has filled the nine months of her residency in SL to the brim.

After opening up a shop called “Red Earth” within her first few weeks in SL, Bella is now at the point where she is running a team of designers for her current shop BDD whilst acting as part of the QT Labs group as an Advanced Virtual Integration Expert.


I caught up with Bella the other night and asked her where she was at with her Second Life and involvement in QT Labs.

Bella Dutton: We believe that at QT Labs we provide a virtual integration of creation, nurturing, building and subsequent maitenence/upgrades of virtual communities. We understand the philosophy, design requirements and intended use and schedule for occupancy so we provide the skills to integrate any organisation or collaborate into SL enviroment/community.

Graham: And you personally – where do you see yourself in say 6 to 12 months in SL? Apart from the AVIE and QT involvement, the shop is your personal enterprise isn’t it?

Bella Dutton: It is, l work with a team of designers and work as a mentor too for newbies.

Graham: I have noticed that SL is a sharing community. Do you think that aspect is a vital one?

Bella Dutton: It does have that sharing community, that is very true as when you think with us all here we are creatures of nature, we all need to feel part of a group or team.



VastPark is essentially a 3D-interactive workspace for game developers, business or anyone wanting to create 3D content. It’s a business fronted by Australian, CEO Bruce Joy.

Using the VastPark site builder you drag in a 3D model from your modelling application and go from there. There’s a good overview provided on how VastPark works here, and the first thing that occurred to me after watching it was the ease of the relationship between offline modelling and the actual creation of the 3D experience.

Is VastPark an obvious takeover target for Linden Lab?

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