Transcribed by Torley.
Philip Linden: Okay everyone! I realize not that everyone there can hear me and I'm sorry for that, but I've got until 11:30 this morning and then I've got a drop-off at summer school to do, so I absolutely have to leave. So I just wanted to get started and again, I'm sure somebody will — maybe if we're lucky here — will do the favor of recording and translating me. I can't type as quickly as I can talk, so I'm not going to try to. I'm just gonna speak a little bit here and then let everybody — well, let's get on with the experience of celebrating Second Life's 7th Birthday this week!
It's amazing for me personally looking back. I sat and thought about this 7th year of operation — you know, for me, it is, of course more than 10 years. I started the company in 1999, so in fact I've been at this for 10 or 11 years now. In fact for me personally, my 30s were basically spent building an experience — experiencing and growing alongside Second Life. It's remarkable that entire decade of my life has basically been dedicated to Second Life. This year, I will turn 42. (Laughs.) So it's an amazing thing looking back and looking at the troubles we're having even just being here together today. I would say that those 10 years have been incredibly hard. They've had incredible moments of frustration. But they've also been incredibly rewarding and inspiring and I wouldn't take back any of it or even do anything differently. And I think that's something that not a lot of people are lucky enough to say.
You know, you might jump up and say, "Hey Philip, of course there's so many things you could've easily done differently that in these last 10 years that would've made things better — or executed better — but you know, changing history has the risk that you might have done something that broke everything in some way, and I wouldn't toy with that. I think what we've achieved here is a magnificent accomplishment together — all of us, the Lindens, the Residents, the Lindens that aren't with us anymore — we've all worked together to build something just incredible. And I wouldn't even take any chance at anything that might mess it up, it's unbelievable what we've achieved.
I was thinking about this — what to say today and what to talk about — and I had a thought. I wanna try something. I wanna read you guys just a quick list that I made this morning, so bear with me and let me read you a list of stuff here:
Our financial fraud detection systems; the systems we use to transfer assets from the Teen Grid; the central databases; our dark fiber backbone; our asset servers which have about 450 terabytes of data; the 40,000 simulator cores in the system; the group chat system; the LindeX Market placement and fulfillment systems; the physics core; the visual rendering system; the scripting engines; the ability to transfer and move land; the region conductor that manages all the sims coming online; the map servers; the inventory servers; the client UI; the content takedown tools; the monetary policy, processes and systems we use; the customer support tools; the Department of Public Works; our international payment systems; our backup systems; Linden Homes; the Welcome Islands; the Infohubs; the grid monitoring tools; the localization systems; the private regions; our land auction systems; forums; search appliances; the Support Portal; metrics dashboards; our Phoenix, Dallas, and Washington, D.C. data centers; our 3rd-party Viewer directory, open source repositories and programs, and our internal build systems.
So I'm just gonna pause there. That is an incomplete list of major components that make up Second Life that I was able to just sit and kind of bring up from memory this morning while I was thinking about us. Now, the reason that I read off a list like that is to kind of — looking back — to sort of beg everyone's forgiveness and explain that this is an incredibly complicated system. And we have been building all of these different systems, these core components — they're all part of the Second Life experience, they all hold it up — together. Over all these years, this team of Lindens, and for some of these things, the Residents as well. They're all important parts of the experience. Probably in the years to come, some of the things I just said will become whole companies in their own right. As Second Life in this experience grows another order of magnitude or two, these things that I just mentioned are probably standalone companies, some of them.
So this is — so Second Life is an incredibly complicated system. We face an enormous set of parallel challenges and I just wanted to take a moment to remind everybody of that. Again, it's a magnificent accomplishment, but the sheer length of that list is one of the challenges that we, as a company, have faced historically, and we very much face it even moreso today.
You know, overall, I would say that our fault as Lindens has been to be overly enthusiastic. We have tried, as a company — because we've been so excited about virtual reality, about we've already accomplished together, what we've seen everyone do, what we've seen you guys do — it's been so exciting that we have tried to fix it all at once. We've tried to make everything better at the same time. I think one of the nicest things about the company is that it's all done out of enthusiasm, it's done out of excitement, it's done out of love for the world. And everything and everyone that's in it. But I think the challenge we've had is that over and over again, we've been this small, smallish company trying to work on something that is just unbelievably complicated and figuring out how to restrict and serialize and sequence and prioritize all of these different pieces has been a huge problem and frankly, one that we've done our best — we haven't done as well, I think, as we could — but it is just a huge list.
I wanted to speak for a couple of minutes and touch a little bit — obviously — on the layoffs we just did. We sadly reduced the size of the company by about a third — by about 100 people a week ago, and that's a big deal and a huge change. But I wanted to say that standing here today in the midst of such a rich world and such continued creative — and for some people, financial — success that's here makes me realize that, that choice is the right choice and one that though it is hard to make, is definitely correct and obvious. We're never going to — as a company — risk the world and the businesses and the livelihoods of the thousands of people who make money working here by growing too quickly ahead of profits. By doing the difficult process of restructuring the company and making layoffs, we'll return ourselves to solid, very solid levels of profitability.
We're safe, the world is safe. As smart as we may think we are, we are not always going to be able to predict Second Life's rate of growth and hiring is something that you tend to do something in a linear way, but the growth that company goes through — especially something as amazing and phenomenal as Second Life — tends to be punctuated, that is, you're gonna have periods. And we've been in one of those periods now for the last year or so, where the world grows very little because we're trying figure out together — you and us — what to do next, how to make it better. The growth, when it comes, is typically non-linear. Growth happens very fast. A company, of course — and we've been through these days as well — reels as it tries to provide a solid service offering for everybody as that growth occurs. And then in other times, you know, you have to hire with the anticipation that there are things you can do that are gonna drive growth. And sometimes that doesn't happen. So I think this combat between linear company growth and sort of non-linear world growth is, again, one of the big problems that we face. And so, to be safe, we have stepped back — reduced the size of the company — and kept everything safe.
Looking ahead as we've talked about, what are we gonna do beyond stepping back? I mean, I think a high-level way to describe it is that we may have sort of two-thirds of the people that we did a couple of weeks ago, but we need to actually do less than two-thirds of the things that we were doing. So the process of restructuring and replanning that the teams are engaged in right now is fundamentally to figure out how to do a lot less a lot better. And also to step back for a moment and readdress our efforts — and refocus our efforts — on simply improving the core product experience that we are having right now, together, as Residents — here. We need to focus on the things that matter most to the people who are here, to ourselves as users of this system. We need to make the basic features and capabilities of Second Life work really well. And so, the planning process that we're going through right now — of retrenching and deciding what's gonna happen next — is one that fundamentally focuses on that, on improving this core experience for everybody.
I think that Second Life — addressing that sort of core experience problem — I still think of Second Life and the past few years as being something like this: Second Life is this wonderful, beautiful city — once you're in it and you're having this amazing immersive experience, you're just totally blown away by it. But the city itself is surrounded by huge walls and a moat. It's like a medieval city. To actually get into it you have to invest an enormous amount of time and energy getting across that moat, and over the walls, and into this amazing new world of people inside that are waiting inside. And I think that in our excitement about the success of Second Life — in its amazing initial growth and the amazing things that you guys have done and that we've done together — we were getting ahead of ourselves a bit as a company and this is what we really talked about in this restructuring. We were building these sort of rickety — we were in many cases building these bridges and scaffoldings that sought to get different types of people across that moat and over those walls, whether we're talking about international Residents, or the community welcome areas, or enterprise or education users — we've been sort of building these little, thin bridges that try and quickly get everybody kind of over that wall and into Second Life. And of course, you can understand why we'd do that, because it's just so fantastic an experience once we can get people there.
But I think what we have to do — what I know is the kind of thinking that's informing our planning process going forward — is ask whether instead we can stop doing those many, many peripheral, highly usage-specific things to get people in here — and instead just take a step back, look at the basic problems that we are all faced by, and by fixing them, fill the moat. Tear down the walls. Stop trying to build over them. We have a product here that can deliver an unbelievable experience to everyone if we simply make the basic pieces of that experience work. Whether we're talking about how many people can stand together in a meeting like this, or how to put clothes on, or manage your inventory, or build basic objects inworld, or how voice works, how parcel media works, live music — all of these basic features are things that are amazing experiences when you can have them, but they're not easy enough yet. They're not — they just in many cases don't completely work, and we — it's so easy to get ahead of ourselves as a company and forget that. So going back to those basics and just trying to make this thing work for all of us is what you can expect to see from us next.
I want to stop because I don't want to run out of time before being able to maybe take a few questions — if the text works. The last thought I had, and it's kind of a thought that always comes back to me in these times: the reality is, slowly but surely, virtual worlds are working. We are still growing. We have grown slowly and steadily over all these years. We may not have a trillion-dollar economy together, but we have a $700-million-dollar economy that is bigger than a lot of countries, continues to grow, people continue to innovate and build amazing things inside it.
So one thing I would say is: looking back and looking forward, let's just keep all working together. Let's keep making this thing easier, more solid, a better experience together. And then, as a final thought, I would say: again, looking back on even the first birthday ceremonies we ever did, that we should all judge ourselves, Residents and Lindens alike, by our actions more than by our words. The actions we've all taken together speak loudest and the wonderful things that we have built together — successfully over these years — nothing can take that away from us together. So let's just keep working together, watch and expect us to keep making the world better for you, and just hang in there and keep going. And I think that every excited statement that I've ever made about VR and about Second Life and about what we're doing together — I believe every one of those — and I think that we may have these funny periods where we have to wait for things to happen. It is all going to happen, and we are going to get everyone in here eventually. So, let me just say again, thank you for all being here, and maybe via text — perhaps we could try via voice — I can take maybe a couple questions before I have to run in about another ten minutes here.
In text chat.
Honour McMillan: thank y ou Philip - what is your ongoing involvement?
Philip Linden: Honour.... I am always working closely with Linden, and lately focusing on how I can help with product direction.
Gazanfer Jehangir: people are thinking sl is headed in a direction to end up as a 3d facebook? any enlightenment on this please
Philip Linden: Hmm..... well SL and facebook are very different. But we certainly do need to make it easier as an experience, in manner similar to how easy FB is.
Youri Ashton: Philip: Could you tell us what kind of things you still do with the Lindens, besides your new project
Philip Linden: Youri: I'm active as board member, and am also often at the office.
Zol Link: I am wondering if SL will have any new graphics updates? And will there be a way to reduce lagging and load times during play, I noticed some places lag less and have less Issues then other areas, I would like to see if you could pull off what Eve online and or Entropia Universe has, where over 1k + players could stand in one area with little to no lag
Philip Linden: Zol: The graphics work we've been doing lately is state of the art, in terms of shadows and the like. I agree that 1000 people in one area would be incredibly great. what we need is higher frame rate for the complex builds and avatars in SL