Tuesday, October 5, 2010

Behind The Rumor About Microsoft Going After Linden Labs

Some of you may have heard something about a rumor flying about Second Life, that Microsoft was making a deal with Linden Labs to acquire them, if the deal hadn’t already been done and they were just waiting to announce it. My reporters and I heard about it to, but the decision was made to not say anything until rumor became fact.

As it turned out, Microsoft was making a deal for a virtual world, but it wasn’t Second Life. It was Vivivaty, a competing world which went out of business in April, which was bought up by the computer software giant. Supposedly, Microsoft may not stop there. And there are people guessing they want a virtual world for it’s X-Box game to compete with Sony’s own virtual world for it’s Playstation game: Home. But these are just guesses.

I spoke to my friend Aeonix Aeon of Pixel Labs a little about this. He told me he hadn’t thought too much about the rumor in itself. On the other hand, he thought that the rumor had a strong ring of truth to it. The way Linden Labs was acting, he felt they were looking for someone to buy them out.

Aeonix had also put his thoughts down in an article online on the Andromeda blog. He had been thinking since April 2010 that Linden Labs had it’s eye on an initial public offering or a buyout. He observed Linden Labs was exhibiting the “telltale signs” of it.

Linden Labs, he stated, was “reaching the end of an investor lifecycle ... Essentially, Linden Lab is at the end of that lifecycle of investment and for those of us who are knowledgeable on this, we also know what sorts of things to expect in the actions of a company in this position.” Aeonix wrote this observation was partly from being in this kind of position in the past.

For a company such as Linden Lab, one can expect that at the end of the lifecycle they would begin acting in (what would be seen by an outsider) very nonsensical manners, with massive layoffs, external office closings, and liquidation of assets in an attempt to bring the company into a leaner and more profitable state. This behavior is also a telltale sign that reorganization in the company is to position that company for the exit strategy of IPO or Buyout from a bigger corporation.

Back to the conversation, Aeonix thought, “ I believe that Philip (Linden) is weighing both sides for the benefit of both himself and investors, as well as the existing community. Which means, there will likely be concessions on both sides. ... Second Life will evolve, and on an increasingly rapid pace. We'll look back and see SL 1.0 and think ‘Wow.. it’s so different than what we have today.’ There may be new rules in place, depending on how things evolve out. ... Of course, long time users will scream bloody murder. We already saw that with V2. ... evolution.”

Aeonix concluded his article, “keep in mind that regardless of the outcome of this rumor, Linden Lab knows that it’s time to pay the devil its due. Whether or not we find that the devil we thought was behind it is truly the devil or just a lower demon compared to the bigger devil of Microsoft, has yet to be confirmed. Let us hope that they aren’t looking to sell all of our souls in the process.”

For Aeonix Aeon’s article: Click Here.

Sources, Andromeda, Virtual Worlds News

Bixyl Shuftan

1 comment:

  1. More accurate would be to say they are preparing themselves to look as good as possible to get those sorts of offers in the near future. Acquisition Exit Strategy. Also, Microsoft may very well have placed a quiet bid to Linden Lab, but that's just standard shotgun tactics when a corporation is looking for technology acquisition - they just throw bids around and see who they get to bite. In this case, Second Life didn't bite and Vivivaty did.