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Wagner James Au has a great post on GigaOm about Gaia. Gaia is a casual immersive MMORPG that describes itself as:

“The world’s fastest growing online world hangout for teens.”

In an interview with Gaia‘s CEO, Craig Sherman, he quotes that Gaia has gone from 0.5m unique users/month midway through last year to 2.5m UU/mth last month. (nb Comscore only has them at 700k UU/mth in March). Furthermore, he claims 300k users log in each day for an average of 2 hours per session, and in their forums area they are getting an average of 1m posts per day for a total of over 1 billion posts so far. And its mostly (85%) US traffic. Impressive stats. Gaia has been pretty quiet about its growth until recently, but Susan Wu was finally able to get them to break their silence by getting Craig to speak at her panel at Web2.0 Expo last week.

Casual immersive worlds have not previously been as popular in the US as they have been in Europe (Habbo Hotel) or Asia (Cyworld). ( I draw a distinction between casual immersive worlds and games such as Runescape and World of Warcraft). Even press darling Second Life, currently reporting 1.7m log-ins in the last 60 days, is lagging Gaia‘s usage.

Interestingly enough, Gaia isn’t the only casual immersive world that is getting meaningful usage in the US. The original casual immersive world, Neopets, is still going strong, with 4.2m UU/mth in March according to Comscore.

Neopets® is the greatest Virtual Pet Site on the Internet. With your help, we have built a community of over 70 million virtual pet owners across the world! Neopets has many things to offer including over 160 games, trading, auctions, greetings, messaging, and much much more. Best of all, it’s completely FREE!

Club Penguin, who Susan also got to speak for the first time on her panel at web2.0 expo, is also growing like crazy – 4.1m UU/mth in March.

Club Penguin is a kid-friendly virtual world where children can play games, have fun and interact with each other.

* Kid-friendly chat
* Lots of fun games
* Nothing to download
* Lots more!

Webkinz, who I mentioned last week as one of the few sites getting their users to visit more than 10 times per month, is also at 4.1m UU/mth.

Webkinz pets are lovable plush pets that each come with a unique Secret Code. With it, you enter Webkinz World where you care for your virtual pet, answer trivia, earn KinzCash, and play the best kids games on the net!

And a dark horse entrant that I was unaware of until recently – Millsberry, run by General Mills (the manufacturer of cereals), is getting 2.2m UU/mth.

Millsberry is a fun virtual city for you to explore. You create a citizen of the city and discover Millsberry through his eyes. You’ll need to make sure he takes care of himself, so you’ll need to get food (from the shopping area) and make sure he exercises (by playing games), but you’ll also get to go on adventures, solve mysteries and have all kinds of fun while visiting Millsberry!

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Even Lego has announced its plans to release a casual immersive world in 2008

These worlds are all exploring different business models. Some are mainly ad supported (Neopets, and effectively Millsberry), others rely on subscriptions (Club Penguin) that deliver certain privileges, and others rely on transactions, either in the real world (Webkinz) or for digital goods (Habbo Hotel, Gaia.

Its worth noting that all of these are websites with no download required. This has likely helped them grow more quickly than other casual immersive worlds such as Second Life and IMVU, which are also growing fast, but not as fast.

One can’t help but notice that all of these immersive online worlds are targeted at kids and teens. If demographics are destiny, then we can expect more and more people to interact with each other in casual immersive worlds over the next few years. Susan Wu thinks so too, and her prediction about web 3.0 (are we there already?) is that it will be:

continuing down this path of improving the user experience of living and socializing online. This story is about human context, social proximity, and a sense of place.

I think she is right. What are your thoughts?

UPDATE, April 26th, 2007: Barbie is now also getting in on the action with Barbie Girls.

UPDATE, April 29th, 2007: Techcrunch reports that IAC’s Zwinky is also launching a casual immersive world. In this case, they are also employing a different business model than the other virtual worlds as the toolbar that enables much of the functionality includes a search box and will be usable both when the user is and is not “in world”. Note that the search box occurs to the LEFT of the URL box… This tactic worked great for previous IAC products such as Smiley Central and Cursor Mania.

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March’s Comscore numbers just came out. I took a look at the top 2000 web domains, but this time I ranked them by number of visits per month. The results were a little surprising. Here are the 41 sites that were visited 10 times or more on average by US internet users in the month of March 2007:

Most frequently visited websites

Let’s peel back the onion a little, and look at these websites by category. Twenty one of the websites – more than half, fall into the category of homepage.

Frequently visited websites by category

Many of these are ISP websites (e.g. Adelphia.com, Optonline.net, Compuserve.com, Peoplepc.com etc), with the balance being portals and search engines (aol.com, yahoo.com, live.com, google.com, etc). One anomaly jumps out – officialsearchlist.org. It turns out that Officalsearchlist.org has around 600k users and they looked at only 16m pageviews from their 9m visits to the site, spending on average 30 seconds. This suggests a relatively low level of engagement. It may be that some of the users of this site have had their homepage reset to officialsearchlist.org and don’t know how to change it. The site has a large section of myspace layouts and it is possible that some less experienced users changed their homepage while getting a myspace layout.

The high proportion of homepages in the list of most frequently visited sites emphasizes the power of the default, which I have posted on before in a slightly different context. Inertia is a powerful force, not to be underestimated. Capturing the first page that a user sees when they start their browser can drive a lot of usage.

The next category on the list is gaming, with four sites; World Of Warcraft, Pogo, Webkinz and Runescape. I’m sure most readers will be familiar with WoW, Pogo and Runescape. Webkinz is a very interesting offline toy – online game hybrid launched by Ganz in late 2005. Ganz has been making plush toys for years, but with Webkinz they gave each toy a unique secret code that allows kids to take care of their pet/toy online and play games with it. It has gone from nothing to over 4m UU/mth since then. Webkinz is part of a very interesting trend towards offline-online hybrid services that I will explore more in a later post.

The Warez/Download category also has four sites on the list. Overall traffic levels for these sites are all sub one million (versus the gaming sites which were all in excess of 4 million with the exception of WoW at 1.7m). It’s not a surprise that people like to get free music and movies.

Communications and Social Networking sites have three representatives on the list (Myspace, Facebook and Hotmail). They are all huge – between 20-60m UU/mth and between 6-43 billion PV/mth. Communications/webmail are also a major driver of portal site traffic. The three count likely under-represents the importance of communication as a driver for frequent visitation of online websites.

The “Other” category is a bit of a hodgepodge, with each site worth looking at individually. I’m not sure that any lessons can be drawn from them as a whole:

    ALURIASOFTWARE.COM. Anti-spyware software – likely updating spyware signatures at each log-in.
    DRUDGEREPORT.COM. Often controversial news site – devotees may be bigger news junkies than followers of other news sites?
    CHRYSLER.COM. Chrysler said that it intended to spend over $1bn in online advertising in the second half of 2006. Perhaps its paying off? Although GM.com wasn’t far behind at 9.8 visits/month, other Auto OEMs like Toyota and Ford had just 2 visits/month.
    WHATISMYIP.COM. Tells you your IP address. Can’t explain why this gets so much usage.
    CLEMSON.EDU. Clemson University’s website. This may be set as the homepage for Clemson university students?
    ADP.COM. ADP provides HR services such as payroll, 401k, and benefits administration. It also offers time and labor management on a SaaS basis – perhaps some workers need to clock their hours on ADP’s website to make sure that they get paid accurately?
    TDAMERITRADE.COM. Are they the online broker of choice for active traders? Schwab and eTrade average just over 5 visits per month.
    PLENTYOFFISH.COM. Free personals website. This rate of visitation is significantly higher than that of paid dating sites such as Match.com. Perhaps free is good, just as with the Warez sites. Oddly though, the other free personals website, okcupid, does not see the same high visitation rates that Plenty of fish does.

    Am I missing a connection with some of these sites in the “Other” category? Some plausible explanations in comments – add your thoughts!

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I spoke today at the Web2.0 expo on the topic of how this generation of internet companies can make money under both media and e-commerce models (Show me the money). This is an expansion of previous posts I have written on this topic.

The short form of my presentation is as follows:

1. Its easier than ever to start a consumer internet company
> 1.1. Not too hard to get to cash flow breakeven

2. For long term value creation, plan A can’t be “get bought by Google”
3. Need to have a roadmap to be an independent public company

> 3.1 Requires real scale
> 3.2 Revenue sometimes lags costs when you are growing
> 3.3 May need venture capital to bridge the gap

I go into more detail on this and lay out the math as to how big you need to be to both breakeven and to be a public company under both business models.

For those who are interested, slides are available here:

Web 2.0 presentation – Show Me The Money

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I’m particularly interested in social media sites with traction focused on topics appealing to endemic advertiers. Social media sites because of their extraordinary ability to grow without incurring marketing costs, and endemic advertisers because of their willingess to pay …

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I posted recently on the importance of context for social media sites; the need to be “easy to learn and hard to master”.

Two recent stories/posts have reminded me on the consequences of failing to adhere to this approach.

Viruoso

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Last week Kosmix announced that Jon Miller has joined their board of directors. I’m very excited.

Jon is one of the most visionary thinkers about the internet that I know. I was his chief of staff while he was CEO …

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I’m still fascinated by what lessons social media can draw from game design, and Amy Jo Kim’s work in the area.

One of her game mechanics is “earning points”, and this is one of the ways that social media …

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Last month I posted about the difference in building websites for the Time Rich vs the Time Poor.

The Annenberg School’s Online Journalism Review has a great summary of findings from Nielsen’s eyetracking studies about how to optimize writing …

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The NYT published an article about barcodes for cellphones in yesterday’s Sunday Times. The article does a good job summarizing many of the benefits of using your cell phone as a barcode scanner that can translate specialized two-dimensional barcodes from …

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Jay Gould (President and co-founder of Bolt.com) recently commented on one of my posts and posted himself about Amy Jo Kim‘s fantastic work on game mechanics and how they apply to social networks and user generated content. I …

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