May 08 2010

The Demise of Web3D – The Hottest Tech Trend of 2008

Published by at 8:59 am under economics,technology

With recent developer conferences from Facebook and Twitter, and the forthcoming Google I/O conference, it’s easy to get wrapped up in the breathless excitement of possibility. It gives tech blogs many millions of pageviews to chronicle each minor announcement as if it were a game-changer.

But, in the weeks and months that follow, the sheen inevitably wears off, and developers start determining which innovations are truly exciting, and which are just so much hype.

It’s the community that makes are breaks these companies – a point that is very apparent when we look back just two short years, at the hottest technology of 2008: Web3D.

Web3D was supposed to herald a new era of realism on the web, creating new business models, and new ways of interacting with technology. Here’s the breathless overview from Erica Driver, of Forrester Research:

The Internet is on the cusp of its next major evolution: Web3D. Within five to seven years, Web3D will deliver an interactive, immersive experience much richer than…today’s Web. In the new world of work that Web3D will enable, people will…move in space…and interact with objects and information — making the digital world seem more like the real world. Workers will use Web3D to teach and learn, innovate collaboratively, communicate and network, interact with and present information, and manage real-world systems.

The examples she lays out to make her case include Second Life (no surprise there), Gizmoz, Transmutable, and Virtual Heroes. These companies were at the vanguard of creating virtual environments that would be used for all sorts of business-transforming purposes – like virtual water cooler conversations and allowing workers to set up spaces that “express themselves.”

So, how have these companies fared? Second Life parent, Linden Labs, recently trumpeted their Q1 growth – they are still growing, albeit not at the rapid, world dominating tear that a startup should – mostly because the economic activity that takes place within Second Life is between users. Gizmoz is basically Elf Yourself for social networks – creepy! Transmutable’s website is now totally empty, except for the “About” section, which hasn’t been updated since 2007. And Virtual Heroes has shifted their business to simulations for fire and rescue workers, and combat training. It’s a space that makes sense, but it’s very niche.

And that’s apropo of the whole Web3D experiment – it’s very niche. In 2008, the thinking was that 3D interactions would crossover from niche to mainstream. But, it’s hard to see why they would. Just because something is a cool idea, doesn’t mean that it makes sense. And it doesn’t make sense because there is no clear ROI or massive audience.

The reasons are easy to understand: virtual environments require a lot of time investment – there’s a huge learning curve to get started, and the payback must be readily apparent to get over the hurdle of trying one of them out. And, there’s just no clear benefit for all that time – you can Skype, or DimDim, or GoToMeeting, and get all the benefits of a “virtual water cooler” if you want them without having to log in to a separate system.

Additionally, the concept of online identity has turned out to be thornier than many expected. Users are just getting used to the socialization of their web presence, and we are in the midst of codifying (that is, writing as code) hundreds of thousands of years of evolved social behavior. If you’re a company that is focused on building a 3D world, you can hardly wade into that fray to take on the challenge of OpenID vs. Facebook Connect. You just want to create a cool world.

Somehow, according to Driver, Web3D was going to lead to “more innovation” and would allow baby boomers to move to retirement communities but still stay connected to their team as they worked part time (huh?). But, the question that has not been answered in a satisfying way is: why? What’s the benefit to the user? To the company? There are an awful lot of costs, but no clear benefit. Basic economic theory tells us that rational actors will weigh costs and benefits, and will maximize their value. And millions have done just that – there is more value in Facebook than in Second Life.

So, as your mind gets blown by all the cool things that are announced on a weekly basis, be sure to take a step back and look at the costs as well as the benefits. That will help you see through the hype and find the nuggets.

What other trends haven’t lived up to their hype? Let me know in the comments.

One response so far

  • The 3D language and formats, archivability, and even basic presentation of 3D rendering techniques are being taught by VRML. It STILL exists today as probably the most popular (and maybe most reviled?) 3D file format for the web. From the glass half full perspective, we learned a lot, everyone involved contributed, and a consortium was born out of it that promised development of a royalty-free IP unencumbered ISO standard. That is the X3D of Web3D today.