Designer Toys and Virtual Worlds ... At last!

Mattel stole my idea!!! Bastards ... just kidding. I actually predicted this back in 05 ...
What are the U.B. Funkeys™ and How Do They Work…
Radica’s U.B. Funkeys™ is the first interactive toy that integrates collecting with connecting. This innovative new product marries vinyl toy collecting with interactive computer gaming, delivering an all-new virtual environment filled with fun and games.
To play U.B. Funkeys™ users first purchase a starter kit. The starter kit comes with a U.B. Funkeys™ “hub,” two Funkeys character figures and PC software. Each collectible Funkeys character plugs directly into the U.B. Funkeys™ “hub,” which is attached through a USB cable to the player’s computer. When a Funkeys character is placed into the hub, the player’s onscreen avatar changes its appearance to match that of the specific Funkey connected to the “hub.” In addition, each Funkeys character unlocks new games and zones in the U.B. Funkeys™ world. The more Funkeys kids collect, the more zones they can unlock and games they can play.
There are 42 different Funkeys in all, some more common than others. Each Funkeys figure allows kids to play a specific game within the world and buy special items associated with that figure. By playing games in the U.B. Funkeys™ world, players earn coins that they can use to purchase items for their “crib.” Players can then customize their crib – from picking out furniture and painting walls, to adding carpet, plants and other home decor – then save and upload it to share with friends.
www.arkadium.com/case-studies-funkey.html

Here Come The Monsters!

They look kinda scary ... http://www.moshimonsters.com/

Virtual World's To Be Mass Market Entertainment

Good article in NYT on the proliferation of online worlds for kids and most intriguing insight on Disney's Virtual World Plan:

“Get ready for total inundation,” said Debra Aho Williamson, an analyst at the research firm eMarketer, who estimates that 20 million children will be members of a virtual world by 2011, up from 8.2 million today. Worlds like Webkinz, where children care for stuffed animals that come to life, have become some of the Web’s fastest-growing businesses. More than six million unique visitors logged on to Webkinz in November, up 342 percent from November 2006, according to ComScore Media Metrix, a research firm. Club Penguin, where members pay $5.95 a month to dress and groom penguin characters and play games with them, attracts seven times more traffic than Second Life. In one sign of the times, Electric Sheep, a software developer that helps companies market their brands in virtual worlds like Second Life and There.com, last week laid off 22 people, about a third of its staff. By contrast, Disney last month introduced a “Pirates of the Caribbean” world aimed at children 10 and older, and it has worlds on the way for “Cars” and Tinker Bell, among others. Nickelodeon, already home to Neopets, is spending $100 million to develop a string of worlds. Coming soon from Warner Brothers Entertainment, part of Time Warner: a cluster of worlds based on its Looney Tunes, Hanna-Barbera and D. C. comics properties....

Disney’s goal is to develop a network of worlds that appeal to various age groups, much like the company’s model. Preschool children might start with Pixie Hollow or Toon Town, another of Disney’s worlds, grow into Club Penguin and the one for “Cars” and graduate to “Pirates of the Caribbean” and beyond, perhaps to fantasy football at ESPN.com. “All the stars are aligning for virtual worlds to become a mass-market form of entertainment, especially for kids and families,” Mr. Yanover said.

PaymentGuy thinks he is right ...

The Question of How to Pay

... makes #5 on Gamasutra's Best Of 2007: Top 5 Most Significant Moments In MMOs. If you want this question answered in the New Year - contact PAYMENTGUY! Happy New Year

www.gamasutra.com/php-bin/news_index.php?story=16758. "At Austin GDC there was a panel on the last day of the event ostensibly intended to discuss the 'biggest opportunities' in online games. The reality of it was that the table was stacked with Marc Jacobs (a staunch opponent of Real Money Transfer) and two big proponents of microtransactions: Raph Koster and Eric Bethke. What resulted is described on Gamasutra as "a tussle for the future of online games". That one moment nicely summed up possibly the most important trend of this year, and speaks volumes about what we're going to be talking about in 2008.

The fight that day was about the value of paying a flat subscription fee versus microtransactions, as seen in games published by Nexon. Blizzard's well known acceptance of both models is an exception, as most companies choose one or the other as their business model. Ultimately, this may be a question that's out of the hands of the designers: American players are already indicating their love of micropayments and RMT by heavily playing newly arrived games of this type. Despite lawsuits and crackdowns, people are still paying real money for gold and other online currencies.

While I think it's unlikely we'll see many companies openly accepting gold sellers in their games, there are a few who have already begun to walk that path. The nebulous acceptance of the newly announced Live Gamer service by Sony Online Entertainment and Funcom speaks to the kinds of arrangements we might see in the future.

Lessons to learn: The only thing better than free is micro-payments. Players secretly like paying for gold. Celebrity game designer deathmatch would make an awesome show."

Here Come the Camels!

Very cool kids camel world from Budapest based Napfolt. Love it! www.coolcamels.com

Here Come the Cats!

Do work around the house, earn points and dress your virtual cat ... what will they think of next? www.handipoints.com/howitworks.php

Second Life Japan - Dead?

I completely disagree that SL Japan is dead. After all, it has only been 5 months since SL Japan was released. Here is the critical expose by blogger shi3z as translated by Chris Salzberg;

Second Life in Japan is virtually dead. While three-dimensional environments such as “meet me” [ja] and Hatena World have seen their popularity rise, the most famous virtual environment in the world has seen its virtual space steadily depopulate in Japan. When a reporter from J-Cast went to check out [ja] some of the Second Life “virtual shops” and “virtual companies” earlier this month, the buildings were apparently still there but the inhabitants were nowhere to be found.

In his December 24th post entitled “A few things one should learn from the failure of Second Life,” blogger shi3z reviews the reasons why Second Life failed to catch on in Japan:

半年くらい前、国内でのセカンドライフは完全にバブル状態だったのですが、誰もがこれがバブルだと認識しつつ敢えて踊らされる側に回った、というのがとても印象的でした。知人のセカンドライフビジネス関係者で本気でセカンドライフをやっていこうとしているのは1割もいませんでしたし、みんな心のどこかで「まあこんなの今だけだし」と思っていた点は否めません。

About a half a year ago, Second Life in Japan was in a complete bubble state, but what was really striking was that everyone chose to be swayed by the trend even while they recognized that it was a bubble. Of the acquaintances I have who were involved in Second Life, not even 10 percent were serious about it, and it can't be denied that everyone, in their heart, was thinking: “This is not going to last.” http://www.globalvoicesonline.org/2007/12/27/japan-learning-from-the-failure-of-second-life/

see: http://www.mutantfrog.com/2007/12/17/second-life-in-japan-depopulating-j-cast/

TAATU CEO Philippe Moitroux on Going English

See: http://www.virtualworldsnews.com/2007/12/interview-taatu.html for an interview with Taatu's CEO on cultural vs geographical expansion i.e.; working with cultural instead of geographical boundaries. "We recognize that language is the last social barrier especially between 10- and 19-year-olds, so we are very keen on offering other ways to communicate... From day one, TAATU has been a multi-lingual environment. We deploy our communities not based on geography, but on language. We have a French and Belgian community and now an English community. We expect soon to open Spanish and German communities. Now our demographic is mainly based in France, Belgium, and the Netherlands."

Moitroux describes TAATU as a fit between Habbo Hotel and Second Life. 70% of its users are between 10 and 19 years old with another 20% falling between 20 and 35, according to Moitroux. Almost no one is over 35. With approximately half a million registered users and a 24/7 monitored community, TAATU works with advertising integration to bring content to young users.

"Of course we're targeting the customers who have an interest in the audience we have," said Moitroux. "So the typical advertisers are coming in from the gaming enviornment or cosmetics or drinks and food, but also mobile telephones and banks—all those people who want to address a market of 10-19 reaching them in a very new way."
So far, he says, there's been a fair amount of interest from the UK and US. TAATU is a Flash-based environment that doesn't require a download. While that's traditionalyl been a positive factor for youth-oriented worlds, the US has seen a boom in client-download youth worlds like vSide. Likewise, last week saw the transition of Coca Cola from working in an online-only environment originally built by Habbo Hotel to working in the client-based program There.com. But Moitroux isn't worried about the transition. "We've been talking to advertisers who appreciate our look and feel and the content that we can give them as far as security is concerned," he said. "Instead of waiting to push by any means this 3D environment, our advertisers are more sensible to the amount of people who can view or play with the product. Our lighter graphics enable us to accommodate more people into our rooms. That's definitely one thing our members appreciate. I believe there will be a market for those worlds. But it depends what you're looking for. We definitely want to continue to be a product for the masses."

Taatu English in Private Beta

Taatu has huge potential. Already popular in France, Belgium and the Netherlands, TAATU, a Habbo Hotel-looking virtual world for young people, recently debuted an English beta version. The company describes it as a Flash-based "safe, managed and moderated environment where youngsters can enjoy rich multimedia content (e.g. music, events, game play)." English-speaking users can move back and forth between the other worlds as well, which have over half a million registered users on average visiting the site twice daily for 2 and a half hours spread out over the week. The demographic is 10 to 19 and split about evenly between male and female. A representative for the company pointed out that previously "the game was available, but without content." TAATU follows a similar pattern to Habbo and other kids worlds by bringing in artists for in world events, but in a different move, the chat sessions are hosted over webcam instead of just in the world itself. www.virtualworldsnews.com/2007/11/taatu-debuts-en.html

Here Come the Ponies!

He has already introduced America to a boy-oriented trading card game (Magic: The Gathering) and one with unisex appeal (Pokémon). Now, Peter D. Adkison is hoping to find new success with a line of collectible cards aimed at girls. This time the product may be a tougher sell because girls in the desired age group — 6 to 12 — have never driven a trading card craze. The cards, called Bella Sara, are clearly more girl-friendly than the latest set of hockey cards or Dragon Ball Z cards. They have pastel colors, fanciful pictures of unicorns and virtual horses to groom, along with girl-power sayings like “Have the courage to trust yourself” and “Use your love to bring peace to the world.” But history is against Mr. Adkison. “Is it possible a trading card product could catch on primarily with girls?” said Alan Narz, a columnist for Card Trade magazine. “Yes. Has it ever been done? No.”

There are challenges other than history. Bella Sara cards are not used as part of a competitive game, where having a rare card can mean the difference between triumph and defeat. Also, each card comes with a code that can be entered on a Web site, unlocking a horse’s stable, but each code can be activated only once — meaning the cards are meant more for collecting and less for trading. (Girls can use a computer mouse to clean the horse’s living quarters and feed it hay, but they can’t trade horses with their friends.)

These matters do not daunt Mr. Adkison, whose business instincts have proved sound. He founded Wizards of the Coast, a game-publishing company that not only made Pokémon a household name but also enabled him to acquire Dungeons & Dragons.

After selling the company to Hasbro for nearly $500 million in 1999, he bought Gen Con, which runs a game convention, from Hasbro. Then he started Hidden City Games, which owns the worldwide rights to Bella Sara outside Scandinavia, where it originated. When he left Hasbro in 2001, “I said I’d never do another card game,” Mr. Adkison said in a recent phone interview from Seattle, the headquarters of Hidden City Games. But he was at the Game Manufacturers Association trade show in Las Vegas in 2006 when he stopped at the exhibit of a Scandinavian distributor. He asked about the cards and was told, “It’s a girls’ game, you won’t be interested,” Mr. Adkison recalled, but “I looked at it and was pretty much on the next plane to Copenhagen.”

The story of Bella Sara starts in Denmark, where Gitte Odder Braendgaard, a social worker who had worked with emotionally disturbed children, noticed that while her son collected Pokémon and Magic: The Gathering cards, her two daughters were not fans.
Ms. Braendgaard designed Bella Sara to be prettier and gentler, and without a competitive component. The resulting product looks something like a combination of the My Little Pony characters, with its dainty toy horses, and Webkinz, the line of stuffed animals linked to online worlds." www.nytimes.com/2007/11/12/business/12bella.html?_r=1&ref=business&oref=slogin

Hidden City Games & Bella Sara the Next Webkinz?

In the girls' world of Tween Brands, something that's pink and purple and has sparkly unicorns on it could translate to profit. So for the holidays, the New Albany-based youth retailer has tapped into Bella Sara -- sets of collectible, horse-themed trading cards that have reached 30 million in worldwide sales. Bella Sara is the latest hot brand to hit the company's Limited Too and Justice stores, where non-apparel items such as Webkinz plush toys and Hannah Montana merchandise have been bright spots in a couple of disappointing quarters. "I think it's a game that will pick up a lot of speed," said Paula Demaso, executive vice president of general merchandise. "It's kind of grass roots, like Webkinz was: No one west of the Mississippi knew about that a year ago." Now, fueled in part by Webkinz, third-quarter sales in the "lifestyle" category at Justice and Limited Too stores are up 77 percent and 60 percent, respectively, compared with last year.
Similar to Webkinz, each Bella Sara card comes with a code that grants access to an online world, where girls can play games and feed and brush the virtual version of their horses. www.columbusdispatch.com/live/content/business/stories/2007/12/07/bella_sara.ART_ART_12-07-07_C12_DB8MT1D.html?sid=101

North of $100 Mill - Not As Much Money As You Would Think?

How Much Money Does WebKinz Make? Business Week quotes analyst Sean McGowan of Needham saying: "Ganz, which doesn't disclose its financials, must now strike a delicate balance: maximizing profit from the fad without alienating parents and kids. Visitors to Webkinz.com spent more than a million hours there in November, but the site is free. As a result, "they haven't made anywhere near as much money as you'd think," says Sean McGowan, an analyst at Needham, who guesses Webkinz sales are north of $100 million. He adds that none of the nascent competitors has figured out how to capitalize on kids' Web time, either." Anyway, on that revenue stream per annum that would value Webkinz or Ganz Interactive North of $1 Billion. Not too bad ... Who is McGowan:
http://www.needhamco.com/Content/News/sean%20mcgowan%20joins%20needham%2011-19-07.pdf
http://powermoves.capitaliq.com/index.php/2007/11/26/needham-company-appoints-sean-mcgowan/

Webkinz Accessories?

Good article in Business Week on "Toys With a Second Life" It tracks Ganz latest acceories-for-webkinz-pets and asks "Can Ganz stay ahead of Copycats": Webkinz are the hottest things in toyland—and competitors have noticed. The little plush animals come with codes that activate an online version of the toy in a virtual "Webkinz World." At least eight other companies are trying to follow Webkinz's lead, with similar new products that link real-world toys with the Web.

Virtually every toy-industry heavy hitter is involved. Dollmaker Russ Berrie (RUS) is selling Webkinz-like Shining Stars at Toys 'R' Us and other major retailers. Mattel (MAT) has created a new online world for Barbie. And Hasbro's (HAS) Littlest Pet Shop has a VIP ("virtual interactive pet") section.

So Ganz, the privately held Toronto company behind Webkinz, is trying to stay ahead of the pack with a push into accessories. In addition to $15 stuffed animals, Webkinz fans also can buy $7.50 lip gloss, $9 bottles of mango body spritz, and various charms, bookmarks, and clothing items. Like the animals, each accessory has its own code that redeems a prize for pets' online avatars.

PaymentGuy wonders with $9 bottles of body spray and $8 lip sticks are they taking this too far??? All the power to them if they can ... we will see what the new Year brings.

Virtual Currency Chart

A way cool chart from Petter Stokke on Virtual Currencies here - http://gibreel.net/mmorates/ "This is a list of real and virtual currency exchange rates against the US dollar. The values listed represent the amount of a given currency you can expect to be able to purchase for 1 USD. Real world currencies are updated daily from the Federal Reserve Bank. The Linden Dollar is updated daily from the LindeX service. All other virtual currencies are updated daily from GameUSD.com."

German Prepaid Credit Cards for Kids

Kids are usually not allowed to own a credit card. But as many of them like to spend their occasional Euro in online worlds and Virtual Assets, some sales people wanted to see this resolved. One way is to offer prepaid cards or vouchers in retail, another is to introduce Prepaid Credit Cards for Kids. This is what is happening in Germany right now. Not only has Microsoft released their XBox Credit Card, also fashion retailer New Yorker introduced a prepaid credit card called “Dress Card”. These cards aim at kids 14+, of course they need their parents permission to get one and there are transaction limits, but it still makes purchasing and transactions online for them a lot easier.

Mobile Payment Option #3

Although the mobile payment industry still doesn’t have impressive numbers to report, we all know it’s the way of the future. Following PayPal and Obopay, consumers in the U.S. will soon be able to use yet another mobile payment provider - PayMate. PayMate is an India-based company and their solution is currently being used by more than 3,000 merchants in the country. The idea is of course to replicate their success in America and afterwards who knows — guess we’ll see them hitting major European markets as well. Similarly to Obopay, PayMate is teaming up with all the interested parties, including merchants, banks and carriers, allowing end-users an extensive breadth to the manner in which mobile payments can be made (online, over the phone, and over the counter). Stay Tuned!

Up to 56% of ONline Shoppers Do Not Have a Credit Card

Mike Carlo, business development manager for Global Collect, said up to 56 per cent of online shoppers don't have a credit card. Also, payment habits differ depending on the culture. For example, Europeans use a different mix of payments than those in Asia. Carlo said that if a hotel accepted only one method of payment, its conversion rate will be about 60 per cent. But that conversion rate rises to 82 per cent if the hotel uses four or more payment methods, including regional credit cards, bank transfer, direct debit, e-wallets, cash and cheques.

Linden Offers SL Account Statements

Second Life creator Linden Labs is now offering players account statements for all monetary transactions that take place within their virtual world.

The statements are available for any month in which a player has ever been active and once requested they are delivered in a neat PDF and automatically display all balances in US dollars for ease of reading.

Linden Labs has always been adamant about furthering their vision of Second Life as the future of commerce.

08 is the year SL also becomes a "Stable Public Utility" according the PR: http://money.cnn.com/2007/12/20/technology/kirkpatrick_rosedale.fortune/?postversion=2007122105

Ericsson IPX Connects 8 Indian Operators

A big deal for Ericsson IPX, which today announced that it is to provide its global internet payment exchange (IPX) payment and messaging service to eight network operators across the country. With this service, Ericsson will enable Indian and international content providers to reach approximately 202 million subscribers in India. The eight networks to offer the services within the coming months are Bharti Airtel, Reliance Communications, Bharat Sanchar Nigam, Vodafone Essar, Aircel, MTNL Delhi, TATA Teleservices and Idea Cellular.

Mats Granryd, MD, Ericsson India, says: "We are happy that these networks have added Ericsson IPX services to their offering and will be joining Ericsson's global network of IPX-enabled mobile operators. This is an important step in bringing a true global payment solution to India where operators and content providers can fully benefit from the reach of Ericsson." Using Ericsson IPX, mobile subscribers in India will now be able to securely purchase mobile multimedia content such as music, games, wallpapers and ringtones from mobile content companies. Payment will be handled in a safe and seamless process between mobile phone user, content provider and network operator and will provide mobile phone users with a high level of payment assurance.
http://www.business-standard.com/common/storypage_c_online.php?leftnm=10&bKeyFlag=IN&autono=31486

Is this the new Linden CTO?

Linden Lab CEO Philip Rosedale is grooming a promising young Linden for an Executive position at the Lab. From Tech Crunch: "I had the opportunity today to catch up with Chris Collins, the “Technical Assistant to the CEO” at Linden Lab, the makers of Second Life. A Commerce graduate from the University of Western Australia he started in tech, then like many locals (Vibe Capital, Mig33) headed off overseas. After working on his own startup 3 years ago in the Valley he fell in love with Second Life and landed a job as a Business Analyst with Linden Lab. More recently he took up the Technical Assistant to the CEO role, an interesting position in that it’s essentially an executive in training position. Collins shadows Linden Lab CEO Phillip Rosedale at all meetings and functions, and is also directly responsible for Lindex Exchange, the Linden Dollar to US Dollar currency service for Second Life. At the end of the position (6-9mths) he will then take up an executive role with Linden Lab." http://www.techcrunch.com/2007/11/21/chris-collins-from-linden-lab-stability-is-the-key/

PayPal PowerHouse

There is no stopping PayPal. It's talent pool just gets deeper (see below), its payment service richer and market share larger. What are competitors like ClickandBuy doing? Just playing for a distant 2nd place in this race?

PayPal recruits execs from Visa and American Express

PayPal Inc., the online payment service owned by eBay Inc., has created four new senior management positions and filled them with payment industry veterans, including executives from Visa International and American Express Company. “PayPal is at a point in the life of our company where we’re becoming mainstream, and we’re bringing in people that have tremendous experience in payments,” a spokeswoman tells Internet Retailer. PayPal has 164 million registered users around the world.

The new hires are:

* Barry Herstein as chief marketing officer, responsible for PayPal’s global brand and marketing strategy and implementation. Herstein previously was chief marketing officer for American Express International’s consumer business.
* Jack Stephenson as senior vice president of strategy and new ventures, responsible for defining the strategic direction of the company. Stephenson previously headed the North American payments practice at consulting firm McKinsey & Company.
* Robert Mansell as vice president of product development, overseeing product strategy and development for PayPal’s payment system. Mansell spent 13 years at Visa International, most recently as vice president of the VisaNet Authorization System at Inovant, Visa’s IT organization.
* Mary Anne Gillespie as vice president of sales, responsible for increasing adoption of PayPal among online merchants. Gillespie has 30 years of sales experience, most recently as vice president of sales at Guidewire Software and before that as senior vice president of Americas field operations for Informatica.

“It’s a testament to PayPal’s current success and its future market opportunities that we are able to attract executives of such high caliber,” says Rajiv Dutta, president of PayPal. “With this team in place, I’m absolutely confident that we will continue to grow and deliver safe and easy payments for our customers around the world.” http://www.internetretailer.com/dailyNews.asp?id=24777

ValleyWag Slag

The dudes and dudettes at ValleyWag have a funny and informative blog but PaymentGuy thinks their coverage of Linden Lab and Second Life, while admittedly hilarious, is just not fair and balanced. He is also a real gentleman who genuinely cares about the his community members. So stop slagging Philip! Admittedly, Linden's CEO likes to hear himself talk but there is no doubting Mr. Rosedale is an internet visionary and Web 2.O pioneer par excellance. Second Life - flaws and all - is still way way cool and enriching peoples' lives around the world everyday. Check the link for the VW's coverage: http://valleywag.com/tech/linden-lab/

PaymentOne Lands WOW

Congrats to the great guys as PaymentOne on its deal with WOW! Should be a win-win for both: http://dror989.ngoweb.com/archives/3

THERE.COM lands COKE

http://www.redherring.com/Home/23258

FlowPlay in Private Beta

http://world.flowplay.com/v10/teaser.jsp

Merchandise as a Payment Method (Urban Vinyl HABBO's?)

Ganz does it with its Webkinz Plush. Webkinz dolls were introduced by Toronto-based Ganz in the spring of 2005 and have quickly become one of the most popular toys among the elementary-school set. The company uses the stuffed animals as a roundabout way to charge for online content. Instead of asking parents to pay for the Webkinz site by entering a credit card number online, Ganz packages access codes for the site with stuffed animals and trading cards sold in stores.

Other companies, like Mattel and Russ Berrie, have copied Ganz's innovative approach. Traffic on Webkinz’s site grew by more than 800 percent over the last year, totaling 7.29 million unique visitors in October, according to Nielsen Online. Its closest competitor, Club Penguin from Disney, had 3.88 million visitors in that period.

So why does a company with a strong "avatar-brand" like Finland's Sulake press on with trying to sell HABBO T-shirts, stickers and mouse-pads when it could sell Plush HABBOs or better yet "Urban Vinyl HABBOS" - like the Gorillas line from KidRobot in the pic - and attach a secret code to the HABBO Vinyl ... VOILA! Oddly enough, HABBO and Gorillas did co-operate on a very successful ad campaign before: http://terranova.blogs.com/terra_nova/2005/08/gorillaz_do_hab.html

Payment Guy predicts you will see Plush Penguins at a Disney Store near you very very soon .... stay tuned.

Go East Young Avatar!

Finnish game developer Apaja got EURO 1.75 mill (or about $240 million USD) from a little known VC based in Estonia named Martinson Trigon. How Apaja can become profitable when its strategy seems to be to partner with media companies like Lycos thus sharing the profits (or worse revenues) in rich markets like France, Italy and Germany and then take VC money to target less-wealth Eastern European markets, all the while relying on high-commission telo-billing like Premium SMS and running game dev and operations in less-than-cheap Helsinki remains to be seen. Maybe they should hire Polish or Romanian devs with all those Estonian Euros?: www.apaja.com/press/75

Penguins and Bonfires

This is after the fact but it is too ironic not to blog about Club Penguin's ambitious plans to launch in the UK and celebrate ... "Guy Fawkes Night" Most little penguins normally do not hang out at bonfires ... http://blogs.guardian.co.uk/digitalcontent/2007/11/club_penguin_to_celebrate_guy.html

Habbo Launches New Site Design

You be the judge on HABBO's new pages - Hot ... or ... not?: http://www.brandrepublic.com/News/769319/Habbo-relaunches-website-easier-navigation/

Webkinz Takes Flack

For launching its second advertising campaign (yes only two - Bees and Alvin&The Chipmunks), parents are and consumer groups are quite pissed at Ganz Interactive. Here is a balanced look at the story from the Globe&Mail:http://www.theglobeandmail.com/servlet/story/RTGAM.20071214.WBmingram20071214144137/WBStory/WBmingram

Rosedale Fires Ondrejka

By now everyone knows Linden's CEO has fired the real brains behind SL, it's brilliant CTO Cory Ondrejka. "Mssively" is a good place to get the goods including some inside info like Cory's own words: http://www.massively.com/2007/12/11/cory-ondrejkas-departure-in-his-own-words/

Pay Up, Kid, or Your Igloo Melts - haha

Good article in NYTimes by MIREYA NAVARRO - perhaps the best online newspaper in the world - on kid-focused social networking sites. Funny title too! http://www.nytimes.com/2007/10/28/fashion/28virtual.html?ref=fashion

The Goods on FlowPlay - at Last!

TechCrunch has a vid on Flowplay (the Seattle start-up by Ex-Real Networks Exec Derrick Morton). Nice graphics and polished teen-avatar concepts - still waiting on more info to see if there is anything unique and innovative and how it will differentiate. see.http://video.google.com/videoplay?docid=8144405687153798918&q=flowplay&total=3&start=0&num=10&so=0&type=search&plindex=0

Apaja's Innovative Global Payment Network

Playray (www.playray.com) is a cool avatar based social gaming site produced by Apaja (www.apaja.fi) of Finland. They have an extensive payment network consisting on online, card and telco payment methods with an impressively user-friendly payment page display. They just announced a large strategic co-operation with Lycos: http://www.lycos.co.uk/games/playray.html

Club Penguin No Overnight Success

Great article and research debunking the notion ClubPenguin is a 2 year old "overnight success" by 36kid; " So, what do I take away from this research effort? The two year “overnight success” as stated in the press makes for great headlines, but the reality is that a lot more effort went into the development and success of Club Penguin than is acknowledged. As the famous vaudeville comedian Eddie Cantor famously said, “It takes twenty years to make an overnight success.” This quote seems very fitting here. I wish the folks at Club Penguin continued success. May the next segment of your adventure be as exciting as the first." Read it here: http://www.360kid.com/blog/?p=33.

GOOGLE Files Mobile Payment Patent "Gpay"

Google is developing a mobile phone payment system as revealed by "The Text Message Payment patent" filed August 30th that details a mobile payment system called GPay and includes sample payment scenarios such as paying for stuff from a vending machine, as well as purchasing items directly from offline retailers. As we all know, mobile payment systems are not new but Google's patent suggests something far broader, and perhaps even independent of mobile phone carriers and their billing systems. Google competitor PayPal currently offers their own mobile payments system, PayPal Mobile but since the March launch it has not revolutionized the industry or anything like that. Witha GPhone Google would have the advantage of embedding GPay in a mobile. Thanks to Rashid for the heads up.

Yahoo Search Adds Paypal

August 21, 2007: Yahoo Search Maketing Adds Quality Score Alerts, PayPal Billing

At SES yesterday, Yahoo introduced some new features for Yahoo Search Marketing advertisers. They include adding PayPal as a payment option, the introduction of a quality score alert system that notifies individual advertisers when their score drops, and enhancing the ad creation process. The latter group of changes includes these items, taken verbatim from the company's announcement:

* Advertisers will be able to create, edit, copy, delete and view all saved ads (up to 20) for an ad group and in one place. And view the performance of their ads against one another with one click.

* Additionally, advertisers will be able to view examples of ads using selected keywords. A best practices tip sheet will be available to view directly in the interface.

* Lastly, once a new ad is created, advertisers will be prompted to create another one. Creating a second ad activates ad testing, which allows advertisers to compare how ads in a specific ad group are performing against one another in order to help improve quality index score.

The article here: http://blog.clickz.com/070821-112115.html

Paypal's New Look, Yahoo Co-operation and Paypal Blog

Oluniyi David Ajao has written a concise and interesting article on Paypal's new look and service features in the face of new competition fron Google Checkout and Amazon. The article also details PayPaal's co-operation with YAHOO and some of Paypal's coming UI and web page changes. Some exerpts: "One can argue that Google Checkout is not exactly a competitor to Paypal, since they are not exactly the same. Google Checkout speeds up your checkout process while Paypal is a complete online payment system. To me, the mere fact that Google Checkout makes online shopping faster (by auto-filling your shipping address and making payment for you without sharing your credit/debit card information) must have made Paypal sit up and offer Paypal Express Checkout."
"These are the highlights (of the coming Paypal web changes):

* PayPal’s home page is getting a new look in a few weeks’ time
* Paypal logo and checkout buttons will all change
* Paypal will be offering local phone support in some more countries
* Disputes and claims will be reconciled faster (now that’s a real claim)"
David's article can be found here with his bio: http://www.africanpath.com/p_blogEntry.cfm?blogEntryID=2171

Also, Paypal has launched a blog at www.thepaypalblog.com

MX Telecom's "PayFortIt" - Powering Paypal Mobile

MX Telecom has just launched a mobile payments service called Payforit, which can be used by all UK mobile phone networks. Its mobile payment service with internet payments provider Paypal has already been rolled out in the US, Canada and the UK. The company is on the radar of potential buyers however. "We have been approached by other players in the industry," says O'Donohue. Indeed the company's reputation is so good that most new business comes from referrals. "We don't have an outbound sales team for example. We've been in a very fortunate position in that way. For example we're in a government scheme in the education sector as the result of a referral because we've done the congestion charge. Schools are also using text messaging for various activities as a result of a referral as well," he adds.
http://www.independent.ie/business/world/the-joy-of-living-at-the-coalface-of-the-textual-revolution-1042430.html

Mobile Payments in India

The Financial Express of India carries an excellent article on PayMate's new mobile payment service here: http://www.financialexpress.com/fe_full_story.php?content_id=168034. Some excerpts:

Enjoying the first mover advantage, wireless transactions platform provider PayMate has launched India’s first purchase-by-text system, which allows shoppers to purchase a range of products and services directly from their mobile phone. And this is not limited to high-end mobile phones with integrated digital wallet technology or those that can scan barcodes. “All that you need is a phone that can send and receive text messages,” says PayMate’s assistant vice-president, marketing, Akshay Sharma


Currently, anybody who has an account with Citibank and Corporation Bank can log onto PayMate’s system. The company is looking at tying up with 12 other banks shortly, as part of the drive to increase its user base. “Once we strike a deal with a bank, all its account users with or without a credit card can register with us. As of now, 10,000 customers have signed up with us,” says Sharma.

"Growing the merchant base is key to driving this business. Some 3000 top merchants in India, including online portals, travel services, utilities, hotels, retail outlets, restaurants, bookstores and hospitals today accept payments through PayMate. Says Sachin Bhatia, co-founder and chief marketing officer, Makemytrip.com, “We are committed to providing our customers the best value – the lowest cost tickets, access to hotels, the best travel advice – and we are constantly looking for ways to improve customer access and experience. Our partnership with Paymate provides customers with an easy and hassle-free booking experience. Customers can purchase our products through their mobile phones with an easy-to-use SMS service.”

Sulake Payment Services? HABBO in the Payment Business?

Sulake is re-organizing yet again and this time around the former CFO, former COO, former Executive VP, Corporate Development and People, but still Deputy CEO, Juha Hynynen, is now Exec VP of Payment Services and Publishing. A recent press release states: "Sulake's long-term goal has been to broaden its product portfolio with new online services, which can be launched internationally by utilizing the unique international network Sulake has built for Habbo. Currently Sulake has offices in 19 countries with a staff of over 300, over 150 payment methods in 32 countries, global hosting centers as well as distribution and marketing partners all over the world. The objective of the deal is to launch a new social networking service based on IRC-Galleria concept to carefully selected countries using Sulake's infrastructure and experience. The IRC-Galleria concept has localized versions already in Russia, Estonia, Lithuania and Germany.

Timo Soininen, CEO of Sulake Corporation: "Sulake's objective is to become a major global player in online entertainment by focusing on virtual worlds and social networking services. We want to build a portfolio of products, which offer a wide range of social interaction services and entertainment for different target groups and for different user needs. Our new service IRC-Galleria fits this goal perfectly. The company behind the service and its skilled employees together with Sulake's current resources gives us a magnificent opportunity to build up a new internationally successful social networking service. Sulake has managed to make Habbo one the most spectacular success stories in the area of virtual worlds and communities and I'm confident we can do this again."
http://www.sulake.com/pressroom_releases_23042007.html

Want to know about Mobile Payment trends?

Paul Ruppert compiled a compendium of 56 mPayment press releases from the last 6 months which “reveals the real action is already occurring with trials in the financial services and retail segments, plus through government central bankers around the world. These are the concrete emerging centers of influence for this developing market. The operators are just going to go along for the ride....” His blog and 56 articles http://paulrruppert.typepad.com/blog/2007/07/mobile-payments.html

Benchmark in 3 of 10 biggest virtual worlds

GigaOm has compiled a list of the top ten MMOs (massively multiplayer online worlds) and it's not in the order most would expect.

Second Life, the virtual world operated by Linden Research that is backed by Benchmark Capital, comes in at the bottom of the list. But, that's okay for Benchmark, since the venture capital firm also counts the second and sixth most popular virtual worlds as investments.

1. World of Warcraft - owned by Vivendi
2. Habbo Hotel - Operated by Finland's Sulake Corp. and backed by Benchmark Capital, 3i Group and Elisa Group
3. RuneScape - Operated by Jagex in the U.K.
4. Club Penguin - Bootstrapped in Canada. Whatever happened to that $450 million Sony sale?
5. Webkinz - Owned by Ganz, a wholesale gift company in Canada. That makes five of the top five based outside the U.S.
6. Gaia Online - Silicon Valley startup backed by Benchmark Capital, Redpoint Ventures and DAG Ventures
7. Guild Wars - owned by South Korea's NCSoft Corp
8. Puzzle Pirates - owned by UbiSoft
9. Lineage I/II - owned by NCSoft Corp
10. Second Life - Operated by Linden Research and funded by Globespan Capital Partners, Benchmark Capital, Catamount Ventures and the Omidyar Network

PaymentOne Adds Mobile Payments to Service

A good bunch of guys at PaymentOne. Congrats on the mobile service launch! Very cool...

SAN JOSE, CA--(Marketwire - June 12, 2007) - PaymentOne® Corporation, one of the world's fastest growing online Payment Services Providers (PSPs) and a leader in alternative payments, announced the addition and immediate availability of mobile payments with its industry leading PhoneBill™ service. In addition to the over 100 million phone/broadband consumers, PaymentOne customers will now be able to offer over 150 million mobile phone consumers a simple and safe way to charge online digital content purchases to their cell phone. PaymentOne is the first provider to combine broadband and landline billing capabilities with mobile payments, providing online merchants a one-stop shop for alternative "no credit card required" payments.

To use their mobile bill to pay for online transactions, consumers can simply send a message to a specific short code or enter their mobile number into the merchant web site. Consumers will then confirm and authorize the charge and be able to access the content or service. Celent, a major industry analyst, expects the value of mobile payments worldwide will more than double in the next couple of years, jumping from $24 billion this year to $55 billion by 2008. Consumers, including younger demos as well as well-established segments with substantial disposable income, continue to demand safer, more convenient ways to pay online. Deploying advanced payment options represents a significant growth opportunity and competitive imperative for online merchants, and unlike other major enhancements, does not require up front investment or incremental marketing costs.

"No credit card required" payment options represent significant potential for content providers and network operators to attract more consumers. When asked specifically which existing bill they would like to add small purchases to, a majority of consumers pick their existing phone bills (see full 2007 Digital Media Payment Report at http://www.paymentone.com/2007poll/index.asp). "We are pleased to provide our merchants even more ways to monetize and transact," said Joe Lynam, CEO of PaymentOne. "As lines will increasingly blur between mobile, online and IPTV, consumers and merchants alike will demand a safe, secure and low friction payment process irrespective of the medium. The consumer preference to simply 'bill it to my account' can now be even better served with our combined offer of Mobile, Fixed-Line and Broadband Carrier billing."

Since 2000, PaymentOne's flagship PhoneBill service has enabled consumers to simply charge internet services to their existing phone and broadband bills. PaymentOne merchants have seen increases in new revenues of 25 to 35 percent. PaymentOne merchants have generated over $2.5 billion in incremental revenues by deploying "no credit card required" payment options, and have acquired millions of new subscribers that were previously unreachable. PaymentOne's PhoneBill™ service including mobile payments is available immediately.

Skype Founders Invest in 3D Virtual World Frenzoo

Ambient Sound Investments (ASI), which was created in 2003 by four founding Skype engineers, will acquire a stake as part of a Series A funding in Frenzoo, the Hong Kong-based, 3D social networking platform. ASI founders include Ahti Heinla, who serves as Chief Architect at Skype, Priit Kasesalu, Senior Developer at Skype, Jaan Tallinn, another Senior Developer at Skype, and Toivo Annu, former Head of Engineering at Skype. Terms of the upcoming acquisition have not been disclosed.

Frenzoo, currently in private beta, aims to be a centralizing hub for teen culture, providing a space for young adults to connect with friends and experience fashion. Users can create their online persona with 3D avatars, and participate within Frenzoo by interacting with virtual clothing, mixing and matching a variety of branded clothes, furniture, accessories and other lifestyle items. Frenzoo is looking to be an ideal advertising network for big brands looking for creative ways to penetrate the teen demographic. In a move similar to Second Life, items within the Frenzoo game will be virtual replicas of branded items, that players can incorporate into their 3D online space.

Other virtual world games that are good for brand marketing include CyWorld, which has recently launched its own fashion directive along side its Eyespot video editing addition, Habbo, and Sony Home.

Enter 9Dragons: Acclaim's Kung Fu MMO Has Launched With 5 Payment Methods

Los Angeles, CA (May 19, 2007) - Acclaim Games announces the Commercial Launch of 9Dragons, a FREE TO PLAY martial arts Massively Multiplayer Online Role-Playing Game (MMORPG) for PC, and introduces the all new Item Mall. Think of the world of Hero, House of the Flying Daggers, Crouching Tiger, Hidden Dragon and Drunken Master rolled into one. In the game, you can rise from a beggar on the streets to a master of Kung Fu as you train with some of the greatest masters of ancient China. With over 500,000 registered subscribers, 9Dragons is one of the fastest growing MMORPGs in the US and Europe. While 9Dragons remains free to play, the commercial launch features the release of the in-game Item Mall, where players can easily purchase various virtual items using Acclaim Coins. Purchasable items include elixirs, healing herbs, and unique outfits for those players who demand that their characters really stand out. Players who want to bundle new features can purchase Premium Packages that offer Kung Fu boosts and other features that can enhance gameplay.

Online item purchases are done in-game using a simple click and buy interface. Players can easily purchase Acclaim Coins with their credit card, bank account, or a variety of other payment methods using safe and trusted online payment services to ensure secure online transactions (using PayPal, Click&Buy, or PayByCash).

Jupiter Research on Youth Payment Trends

JupiterResearch has announced a new report titled "Payment Preferences Online: Managing the Generation Gap Between Mature and Young Adults" that found that younger consumers (those under 35 years of age) are evolving very different payment and content consumption habits from adults over 35. In particular, "JupiterResearch found that younger adults are driving much of the usage of PayPal and debit cards for online purchases, product preferences which are helping to drive the marked differences in payment habits that exist between younger adults and baby boomers."

According to the study, 48 percent of consumers ages 25 to 34 prefer debit cards for Internet transactions, as compared to only 39 percent of all online consumers. Thirty-four percent of online consumers ages 18 to 24 prefer PayPal or similar services versus 27 percent of all online consumers. "As younger adults expand in proportion to the workforce, their earnings and overall capacity to purchase will also increase. This will solidify the most durable of their different payment preferences, “said Edward Kountz, Senior Analyst at JupiterResearch. “This trend will require payment-product issuers to develop marketing and product strategies to meet the payment desires and changing values of younger adults. This will include card features tailored to younger adults' lifestyle needs, and marketing efforts that embrace emerging social media.”

The deviation in online payment habits between younger and mature consumers can be directly linked to a number of social and technology trends that have emerged during the past two decades. According to the survey, the introduction of the internet, maturation of PayPal and related services, emergence of debit cards and stored value cards, and availability of data-capable mobile phones and other mobile are embraced by younger consumers as they have co-existed with technology for most of their lives.
"Beyond modifying today's most common features and products, issuers and vendors must keep an eye on the emerging data habits of younger adults, and pay special attention to how their payment and data preferences feed into tomorrow's payment-product and form-factor innovations,” said David Schatsky, President of JupiterResearch. “While a critical mass may be hard to achieve for such next-generation innovations over the short-term, leading issuers should seek to establish an early understanding of younger adults' likes and dislikes with regard to emerging payments services.”

Bratz Doll Online World Coming This August

Bratz doll's are getting their own virtual world - Be-Bratz.com - this August. The company is also launching Rescue Pets (my e-pets.com) this summer

MyMiniLife

Over at TechCrunch there’s an article about MyMiniLife. In a nutshell, it’s a competitor to CyWorld or Habbo, with social network aspects and virtual apartments. The client runs in Flash, so you can embed it inside any site: your MySpace profile, Yahoo!, whatever. The look of it is very Sims-like. You use virtual currency to purchase stuff to decorate your house with. It’s put together by a bunch of students who seem to have gotten together at U Illinois Urbana Champaign, though now one of them is a grad student at UCLA. And they’ve been around since the middle of last year, running along quite quietly.

Sony Buying Club Penguin?

Several blogs, including PaidContent, reported today that Sony is in "advanced talks" to buy ClubPenguin a social networking and online game site geared toward kids that was launched in October 2005. The price is reported as in the ballpark of $450 million. The subscription-based (six dollars per month) ClubPenguin takes the form of a massively multiplayer online role-playing game (MMORPG), where children play games, amass virtual goods, and interact with each other, all while participating as penguin avatars. According to PaidContent, the site rakes in about $60 million in revenues and is already profitable despite being fewer than two years old. In March, ClubPenguin had 4.5 million visitors.

The ClubPenguin acquisition by Sony hasn't been confirmed yet. But it's already clear that Sony has interest in the MMORPG and virtual world space: it's in the process of launching its own virtual world (for grown-ups), called "Home" and accessed via the PlayStation 3 console. While social networking sites with teen and adult audiences, like MySpace and Facebook, tend to monopolize the press buzz, their younger-skewing brethren are a force to be reckoned with. Recently, Webkinz have proven popular among the single-digit set, and NeoPets was a hot acquisition for MTV Networks in 2005.
After all, with kid-oriented social networks like these, it's Mom and Dad--not teens or 20-somethings on a budget--who have the wallet power.

The Endless Debate Continues - Subscription or Pay Per Play?

Arguably the highlight of the Online Game Development Conference in Seattle was Friday's panel focusing on new payment models for online games. The blue-ribbon panel covered topics ranging from Microsoft’s points and iTunes to secondary markets and farming, as well as the history of payments in the Asian market. Rich Wickham, business manager for Microsoft’s Games for Windows program, began by discussing the amount of people in the marketplace: “We do have to find new and different ways to get people into these games.”

John Maffei of Affinity Media (which owns Allakhazam and other sites aimed at MMO players), noted that users of his site spend an average of 22 hours a week playing online games. “I think a subscription model is fine,” he said, but noted that “diversification is a key thing.” Maffei believes that players might spend time in disparate worlds, but wouldn’t devote their time to two nearly identical games. “Can I see someone signing up for a hack-n-slash game and a sci-fi game? Yes.”

Joshua Hong, founder of K2 Network and moderator of the panel then introduced the topic of ‘free to play.’ Peter Gollan of EVE Online developer CCP said that it depends on the content inside a game is supported. EVE is a subscription game, and new content is released twice per year. Perhaps, said Gollan, if content isn’t regularly updated, maybe the game doesn’t deserve subscriptions.

Tony Park from Chinese publisher The9 said that, in Korea, there are only ten to twelve subscription games. None of them, he noted, were casual games or developed in the past two years. The market is moving towards subscription, though in terms of the profits, not necessarily the number of total games in the market today. When the secondary market was introduced, a lively exchange began.

“When it comes to micro-transactions, it’s a massive barrier to something becoming successful outside Korea, and to a lesser extent, China.” Park detailed that the history of micro-transactions. He noted that in the days of Lineage, Korea had – very uniquely – a lot of cybercafés with fixed IPs. That way, publishers were able to bill the stores based on the IP address. Customers would purchase coins, and then give those coins to the cybercafé, with the café then directly making bank payment to publishers. “People didn’t have to worry about micropayment.” The changes came about from looking into the Chinese market, and other places, and the subsequent need to find newer payment models.