Blue skies, clean streets and beautiful bronzed people at every turn. On a boulevard in San Francisco EN has arranged to meet some of the world’s highest-profile entrepreneurs in what must be one of the most lavish interview settings in the magazine’s illustrious history.

But EN hasn’t broken the bank to send a reporter 5,000 miles on the red-eye for the sake of journalistic integrity. In fact, Tallulah Morpork, the magazine’s 6ft flame-haired Amazonian beauty, can be transported back to Manchester’s Art Gallery, the Business School, Urbis or Liverpool’s Mathew Street in seconds without leaving the office.

Because this world is Second Life - an internet-based virtual planet with thousands of servers (called simulators) and a population of over 15,328,632. And millions of pounds of real-life business is being transacted in there.

Avatars, or residents as they prefer to be known, come from over 100 real-world countries, with concentrations in North America and the UK. Around 60 per cent are men and they span in age from 18 to 85 - though very few of their real-life creators choose to present themselves as pot-bellied OAPs on the streets of Second Life.

On average 492,500 avatars log in each week. Many are gamers, attracted to Second Life’s similarities to the dragon slaying interactive game, World of Warcraft, which is incredibly popular with cyber geeks. But there are also housewives, artists, musicians and business owners in there.

It is in some ways similar to Facebook and MySpace, but Second Life (SL) is social networking in the extreme. Characters quite literally live a “second” life. They make friends, they work, they build homes, they kiss and cuddle and they listen to live music and have a beer.

What makes it most unique though, is the inclusion by Linden Labs, the creator of Second Life, of an in-world currency, the Linden dollar, that players can convert into US dollars by using their credit card at online currency exchanges.

The exchange rate is constantly changing, but is generally between 270 to 300 Linden dollars for one US dollar.

SL residents can buy and sell anything that can be made inworld, from clothes, skins, wigs, jewellery, and custom animations for avatars, to furniture, buildings and vehicles and they trade in Lindens to conduct real business. But there is no police force, no courts and the banks and stock exchange have been criticised for lacking regulation. Legal experts have called for a stricter regime to prevent money launderers, fraudsters and terrorists using Second Life as a haven to hide and move funds. The Vancouver Police Department was the first to enter Second Life in 2007 but its presence is for recruitment purposes only and its avatars have no powers of arrest.

In many ways it’s much easier being an entrepreneur in Second Life than in real life, according to Vin Sumner, whose Manchester-based IT company, Clicks and Links, expanded into the virtual world in 2006 and now develops commercial premises for Second Life businesses under the “Second Places” brand.

He says, “People start out not knowing what they can do with it. It’s similar to how people saw the web in the early 90s.”

As happened with the web, big name businesses like Adidas, Dell, Nokia, Cisco Systems, Sun Micro and IBM are amongst the first to have developed a Second Life presence, mainly to take advantage of the mass marketing opportunities the online world offers. A pair of virtual Adidas trainers for an avatar might cost the equivalent of two pence but the hope is that the creator will want the same shoes in real life. Adidas won’t make money in-world but it’s Second Life presence will generate traffic to the real world transactional website.

Sumner says, “Many of these businesses have treated the Second Life business as part of their marketing budget so it’s difficult to judge how it has contributed to the bottom line.”

Most things that exist in real life also exist in Second Life. Virtual tables and chairs, virtual clothes with virtual stitches and virtual jewellery sold by virtual people in a virtual world. But the real-life creators of these skilled avatars need little more than basic IT skills.

Sumner says, “We could create an office for you in Second Life and you could be trained in how to maintain it. Effectively you could choose the wallpaper of the office without having to come back to the professionals who designed the original space.

“You can do it all yourself for a few hundred pounds, like a website, if you want to do something basic and quickly. But for something quite sophisticated you would hire a firm like ours who would charge by the time spent.”

As in the real world, once you’re ready to bring your products to the market, it’s a matter of buying or renting property for opening up a shop. There are also resident-owned shopping centres which charge rental fees or take a cut of your proceeds. A single basic account is free and premium accounts (required for getting land) start at $9.95 per month for a 512 sq m plot.

So how does entrepreneurialism in the virtual world compare with the real thing?

“The big difference is that manufacturing costs are zero,” says Sumner. “Once you have created something in there you can copy and paste it as many times as you like.

“It might cost 100 Linden for a shirt, the equivalent of maybe two pence, but it doesn’t cost the person producing it anything every time someone buys it so they quickly recoup their costs.”

Career and employment advisors exist in Second Life too. By teleporting to Manpower’s SL headquarters, EN’s in-world reporter can chat in real time to Derrek Watkins, one of Manpower’s in-world advisors.

So could Tallulah Morpork make a living in Second Life that would allow her a life of luxury in the real world?

Watkins, a handsome chap with a big chest and a tight white t-shirt offers advice on the world of work for SL residents. He says there are lots of work opportunities in Second Life, “You’d have no problem getting a job with SLCN TV with your experience in real life as a reporter but it’s most lucrative for entrepreneurs, and those with some IT skills.”

Watkins is charming and a flattered Morpork right clicks on “gestures”, blows him a cheeky virtual kiss and teleports out before she can discover whether an avatar can blush.

EN’s reporter was herself forced to lose any real life inhibitions when, five minutes into her Second World debut, she was accosted by Sweets Gillespie: “Do you fancy going somewhere to be naughty?” Propositions such as this aren’t rare.

Beyond business, Second Life raises some contentious social issues. Linden Lab has rules against offensive behaviour in public, such as racial slurs or overtly sexual antics, but consenting adults in private areas can engage in sexual role play, some of which, according to numerous message boards, would be frowned upon in real life.

Lanai Jarrico, is the in-world publisher of the SL Enquirer, a weekly publication that is available free of charge to avatars. Rebecca, as she is known in her real life in Pennsylvania survived a coma in 1997 and during her recovery discovered the virtual world in 2005.

She considers her role as CEO of the in-world paper her full-time career and spends more than 60 hours in there every week.

She says virtual office romance is the biggest threat to Second Life businesses: “The biggest mistake for SL businesses happens when avatars partner up in a romantic way and it ends in drama.

“This is where the SL culture and business can cause catastrophe. That’s not to say all couples who have businesses are doomed.”

Jarrico sells banner space for 3,300 Linden dollars per month and employs 15 staff but since setting up in 2005 has never made a Linden to real currency transfer.

She says, “Trying to run a business in the same manner as the real world is difficult when you deal with many talents from different time zones and schedules.

“As silly or as unbusinesslike as it may seem, I’m not sure how to make a transfer like that but I sure know how to drain my account into Second Life.

“Estimating the cost to maintain my website hosting fees, my land rentals fees, paying writers, promoting SLE, entertainment activities and contests, I have invested over $4,500.”

Jeff Krantz entered Second Life as Hep Shepherd in 2007, having left a job in real estate with the idea of using the virtual world as a promotional tool for his fledgling solo music career. He says, “I made the decision early on to make my avatar Hep Shepherd an extension of my real-life personality.

“Because of the live and interactive format of Second Life I was able to retain my identity in the virtual world. The only difference is that Hep is in a bit better shape than me.”

Shepherd’s Second Life presence has been the launch pad for a successful career in real and Second Life. While he can earn up to $250 per gig as a singer songwriter in the real world, he says Second Life shows, which pay around $100 (excluding endorsements and sponsorships) and don’t involve the expense of travel and accommodation expenses, are more worthwhile.

“Being an online musician is very much like being an international stock trader - there is always a market open at any hour of the day and an opportunity to perform. You’re not going to earn a fortune in SL but you’re not going to lose money like you do driving across the country to play a show to 20 people.

“It’s less saturated than the real world. When you are visible in any market opportunities come easier. If I were to call a company for a sponsorship as a new musician they probably wouldn’t take my call but within a year of performing in Second Life I secured two very sought-after sponsorships.”

In some ways, though, the lives of Second Life musos are more frustrating than those of their flesh-andblood counterparts. Inundated with invitations from groupies to go skinny dipping in their online homes, Shepherd says his next purchase will be a virtual penis.

Caroline Ashworth, head of marketing and communications at Urbis, worked with Clicks and Links on its creation of the gallery’s SL version which opened to the virtual public in July 2007.

She says, “At the time no other museum or gallery in the UK had a Second Life presence. One of the objectives was to build some additional space where people who couldn’t get to Urbis in real life could come to see us in Second Life.”

Without the space for a permanent collection at the real-life Urbis, the virtual venue acts as an archive. Over 3,000 avatars have visited Urbis in SL since it opened. It’s way off the 250,000 people that visit the real-life Urbis each year but, Ashworth says, it is an integral part of the marketing mix.

“After the initial set up costs the only cost is the rent of the space on the island. All maintenance and development has been done by our own team in-house. It’s a few thousand, rather than hundreds of thousands, in real money, per year. But if we had to outsource the maintenance it would become extremely expensive.”

Contrary to the headlines, business activity in Second Life thus far is largely restricted to business development exercises and staff simulations. While many a well-dressed avatar can talk the talk in the unreal world, evidence of successful business ideas, beyond trading in and developing land, is very hard to find.

If the experience of Urbis is anything to go by, it appears that in Second Life, just like in the actual world, it’s the consultants and the landlords that make the real money.

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