Reaction Grid continues to come on strong and is emerging as the leader in hosted virtual world solutions.  Their recent wins are impressive and include corporations leaving Second Life. To be fair to Linden Lab, their focus has been in creating a social networking site.  Dusan Writer has written about this often – Second Life is a social application more than a business one.

And, in accordance to the Gartner Hype Cycle, many businesses enjoyed great press 2 years ago when Second Life seemed to be the answer and the next dot com boom.  Well building out a sim just did not do it and many corporations pulled out.  But that was not Linden Lab’s fault.  Second Life is a social platform and creating meeting rooms like the Crowne Plaza did was indeed a neat use of Second Life but not enough to have any ROI.  You could book one of three meeting rooms with an online tool that let you create a list of approved avatars.  But Crowne Plaza never did events or gave any reason for people to come use their sims.  They did, however, enjoy some positive press and that is worth something (similar story for the Bellagio in Second Life).

For Crowne Plaze, I would think that the steady hit of nearly $600 a month is hard to justify.  Especially in the hospitality industry which is experiencing a 32% reduction in RevPAR this year. Suddenly a Second Life offering that is not being marketed is easy to cut.

What Crowne Plaza, and other properties, did not do is offer virtual worlds as an item for real events and meetings.  Just like a Twitter board is becoming common at conferences, virtual worlds will be too.  However, not as a replacement but as a supplement.  This is a key distinction.

So how does a business enter virtual worlds and show a positive ROI? First, you have to go in with a purpose.  Perhaps you only need to hang a virtual shingle and that is fine.  But $1,000 up front and $295 a month is steep.

Why not look at a different virtual world?

Second Life is not the only game in town (list of public grids).  In fact, if your IT department is savvy and enjoys delving into new things, perhaps installing OpenSim on your own box is ideal.  IBM is both in Second Life and also has their own OpenSim initiative in OSGrid.

If you don’t need to set up clubs complete with dance poles and shoes that sparkle with bling, then you likely do not need to choose Second Life as your virtual world option. This brings us back to Reaction Grid.  There is no in-world commerce (yet) and you won’t have as many dance poles to choose from (but you can actually find some) however, for business use – Reaction Grid is emerging as the choice.

And that is not just my opinion, but the opinion of major players like Microsoft, Intel, and Boston College. Much of this is because firstly, Reaction Grid is good.  Very good.  Being fully based in the open source community means that the server code is continually being improved.  If you are not familiar with what that means to be open source, you have a group of incredibly passionate and talented people who work together to make an application better.  The OpenSim community is active and teeming with talented people.

I have benefited from these advances with performance that beats Second Life hands down.  Lag (performance hit on the user’s machine) is a big consideration for holding events and meetings in virtual worlds. 

In Second Life, it’s just something to be expected.  We had an art reception for Patrick Millard and needed to border two sims in order to have more than 50 avatars attend and not be terribly “lagged”.  Last night, Ener Hax from our iliveisl estate, had to address lag of 4 frames per second (below 15 is noticeable) on a sim that was hosting a music event and there were only 28 people on it.  That is considered horrible lag, especially for $295 a month!

In Reaction Grid, having virtual meetings and events benefits from more efficient server code plus the talent of their team. Enter Kyle, the zombie maker!

As CEO (sounds stuffy and he is anything but that) Kyle guides Reaction Grid’s growth and future direction. His background is so technical that it intimidates people like me, but that’s the kind of background you want in this type of venture. In my opinion anyway. 

Changes at Second Life have been sometimes puzzling in the last year, but with their new CEO it is not surprising.  His background is that of a CEO, not a passionate “virtual worlds rock” kind of person.

When I go to a nice restaurant, I want a chef that is passionate and for whom food is their entire world.

That’s Kyle with virtual worlds.  He is in tune to people’s needs, enthusiastic, and talented – he is the chef I want.  And clearly what people like Microsoft want as well.

So why is he a zombie maker? Well after a skype session (rather long, sorry Kyle, I do carry on) he has ignited me even farther and I need to never sleep again to accomplish all the things I want to do related to virtual worlds.  It’s nice to have that energy back and a place to focus my passion.

Reaction Grid is more than a virtual world host.  It’s people like Kyle and his team that truly believe, and act on those beliefs, that they can make a difference.