It’s time to get out the crystal ball again. I thought I’d take a slightly different approach this year by tackling ten fairly broad themes and identifying appropriate specifics under each. I tried to cover all of the main issues though the field is so large now as to ensure any roundup like this won’t be complete.

Hopefully there’ll be a better success rate than last year. As always, would love to hear your thoughts on what you see occurring during 2011. If you’ve got your own set of predictions, either post them in the comments or provide a URL and I’ll link it at the bottom of the post.

The predictions:

1. Second Life

It’s fair to say that Linden Lab had a mixed year during 2010 with Second Life. 2011 is likely to be even more turbulent. I’m not going to fence sit on this one too much: the next 12 months will see Linden Lab finally sold to a big tech player based in the US. Whether it’s bought out or not, expect some more significant user-interface improvements but an overall decline in number of hours in-world per user. That decline will be driven primarily by diffusion as dedicated content creators, educators and long-term residents increasingly spread out to OpenSim grids, Blue Mars etc . Second Life might see an increase in concurrency, coming from the more casual / social users attracted by an easier to use interface. That seems to be Linden Lab’s strategy anyway. Oh – and legally compliant gambling will be provided in-world by Linden Lab.

2. OpenSim

The safe prediction here is ongoing growth, but beyond that it’s a pretty murky picture. Consolidation is one of the clearer trends: a handful of grid providers will probably hold some dominance, with a skew of smaller / solo grids running. Hypergrid protocols are ever-improving, but for wider-adoption the larger providers will play a key role assuming they can keep delivering good service with a growing userbase. So overall: continued growth and emergence / consolidation of larger grid provders.

3. Blue Mars

Over the past year Blue Mars has been continuing to evolve and has picked up a cohort of Second Life content creators. Assuming the funding keeps coming in, that growth is likely to continue although it’s doubtful that 2011 will see Blue Mars reach full launch and if it does, expect a slow but promising level of uptake by new users. Unless Second Life has a major stumble, Blue Mars won’t be in its league as far as content or user numbers during 2011 – 2012 may be a different story though depending on how things pan out with both camps.

4. The casual phenomenon

The casual worlds like on platforms like Facebook will continue to fragment. Numbers will continue to grow but at a much slower rate. Fatigue with the limitations will also grow as people debate the merit of these worlds versus more traditional casual games (think Bejeweled etc). Not surprisingly there will also be a lot of underperforming worlds that close – exacerbating the fatigue with the genre from more experienced users.

5. Media and societal acceptance

The coming year will see increasing focus on how we interact in virtual environments. The Microsoft Kinect is already receiving a lot of attention, and the media are likely to latch onto the theme of improving physical activity whilst highlighting the odd case of severe addiction/injury. Nothing new there really – the difference over time however is the growing acceptance that these developments need to be incorporated into society’s thinking on a range of issues. Key educators and policy-makers have known this for years but that widespread acceptance (if not understanding) is certainly taking a big step during 2011.

6. Government

The momentum with virtual worlds at the US Government level is significant, driven primarily by intertwined military and health-care needs. Beyong that 2011 seems a pretty arid zone on the government side. Although there are potential cost-savings in the longer-term, most European governments aren’t in a financial state to invest heavily in ‘cutting edge’ work. In the Asia-Pacific I’m always surprised at the lack of overt work in the area and don’t expect 2011 to be any different. On the home front, the national political scene is favourable only from the viewpoint of the National Broadband Network rolling out. Government 2.0 initiatives are at a fairly early stage and virtual environments aren’t playing any active role in that anyway at this stage.

7. Browser-based evolution

Like it or not, people want the ease of a browser-based virtual world without losing too much of the complexity. This year will see that trend continue with some good new options emerging. Using Second Life as an example, development is well underway both at Linden Lab and externally. What you definitely won’t see this year however is a browser-based experience as good as the standalone offering. That’s well over 12 months away but it is coming.

8. Gaming Worlds

2011 is actually a huge year for MMOs. The key event will be the launch of Star Wars: The Old Republic (SWTOR). We’ve been following it pretty closely and so far it’s looking like it’ll be successful. There’ll be a lot of talk about SWTOR being a World of Warcraft killer. That’s a lot of hyperbole (for 2011 at least) but expect it to pick up a very significant user base in a short time. To be more specific, by end of 2011 I’d expect subscriber numbers to be sitting between two and three million minimum.

World of Warcraft itself will see fairly steady or slightly declining numbers maintained by the recent Cataclysm expansion, with continued dominance of the market for the coming year.

9. Business

Absolute status quo: there will be no increased level of traction with business beyond some further acceptance of virtual meeting solutions. The ROI equation for business till isn’t clear enough, making adoption of virtual worlds technologies an exception to the rule. Good research (see Point 10 below) will be crucial for this to change.

10. Research and Development

The number of virtual worlds research projects will continue to increase, with a particular focus on areas such as simulation and the neuropsychological aspects of virtual reality. The simulation research will be pivotal in building solid cases for business, non-government and government adoption of the technology. In an environment where more and more human services professionals are needed in an ageing population, simulation makes huge sense and will be a key driver in the medium term.

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So what say you? Let the debate begin.

Having completed our review of our 2009 predictions, we’re back for another round for the coming year.

1. OpenSim will continue or even improve on its growth trajectory – the momentum will continue, although a handful of larger grids are likely to have the lion’s share of that growth, with all the challenges that go along with it.

2. Australia will have its first government funded virtual environment – a proposal is already underway to see this come to fruition. Education will be the focus, but the foresight of the proposal’s facilitators is likely to ensure it involves business, education and government in a collaborative partnership.

3. Closures – it’s not a desirable prediction to make, but unfortunately it’s also a fairly safe one. There’ll be company and/or platform failures. Some may be bought out, but like Metaplace in the past week, there’s going to be some outright shuttering of some environments. I have some specific ones in mind but don’t have the data to support naming them specifically as being on a ‘death watch’.

4. Intellectual property disputes – The Eros vs Linden Lab action is likely to be resolved during 2010 and it will generate a large precedent in regards to virtual goods. Linden Lab will probably defend the action successfully, but the playing field will still have changed considerably.

5. Integration – Whether it be Second Life or Habbo Hotel, the level of integration between virtual environments and social media services will increase. Whether it’s a Facebook Connect sign-in or the ability to Tweet from Second Life, that functionality will move from the plugin / add-on phase to core architecture more commonly.

6. ABC in Second Life – I don’t have any inside knowledge on this, and I really hope I’m proved wrong, but I can’t see the ABC continuing to fund its Second Life presence beyond 2010. For the past year, the majority of the activity on ABC Island has come from its tight-knit community, with support from ABC staff. With the burgeoning ABC Online continuing to grow, there’s always the risk that the Second Life component will be squeezed out. Please, prove us wrong on this one.

7. The mandatory ISP filter – If the legislation passes during 2010, there remains a real possibility of adult content in Second Life and elsewhere falling foul of the filter. There were some gob-smackingly naive acceptances of Linden Lab’s claim they’d heard nothing about being affected by the filter and therefore were not concerned. There’s a chance everything will be fine but given the blacklist isn’t defined, nothing is certain at this stage. Our prediction: Australia-specific verification mechanisms will need to be put in place for Second Life and other environments where content creation occurs.

8. Taxation of virtual goods – 2010 will see the United States further formalise taxation arrangements in regard to virtual goods. I doubt the Australian Tax Office will make any substantive rulings in the coming twelve months.

9. Gaming worlds – 2010 is going to see the largest MMO launch since World of Warcraft: Star Wars The Old Republic. It won’t eclipse the incumbent but it will become the solid number 2 player in the short-term, with all bets off in the longer term. The second half of 2010 also sees the launch of the next World of Warcraft expansion, called Cataclysm. Head-to-head clashes in the MMO industry don’t get much bigger, and it’ll make for some fascinating times.

10. Social games – this year saw social games like Farmville take off in a big way. There’ll be some significant fatigue from users with these platforms, but there’ll also be further innovation to make them more engaging and with easier integration of virtual goods without the spam-like accompaniments that plague people’s Twitter or Facebook timelines. Overall: continuation of exponential growth, albeit not at the same level it has been the past six months.

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Again, over to you. What’s in your crystal ball for the coming year?

Other sites with some interesting 2010 predictions:

Eddi Haskell
Daniel Voyager
Adam Frisby
Living on a Prim (some damn funny ones here!)
All Virtual (focused on virtual events)
Second Sins (NSFW)
Tateru Nino
Adric Antfarm

Twelve months ago we published our ten predictions for 2009. Below is the report card on them.

2009: how accurate was our crystal ball?

Prediction 1: OpenSim grids will bleed Second Life users – this may seem a very obvious prediction given the growth of OpenSim grids, but what I mean here is that the exodus will be obvious. It won’t be a migration that will affect Second Life’s viability (other issues may achieve that), but there will be a solid, committed population of OpenSim users choosing those grids over Second Life’s one. Put another way, new users will see OpenSim grids as an equal option to signing up to Second Life.

Pass – the growth in adoption of OpenSim has certainly grown and at the expense of Second Life. People aren’t abandoning Second Life for OpenSim en masse but there’s plenty of content creators and educators dividing their time between the two environments. Here’s one small example of that switch.

Prediction 2: Virtual worlds will appear as normal daily life in TV / Movies – To date, most appearances of virtual worlds in TV and film are either documentaries or as a central part of an action / geek film. US comedy The Office and CSI have both featured Second Life but essentially in a sensationalistic way. 2009 will see more insertions of virtual worlds into daily life scenes in shows. A disclosure here: I’m particularly confident on this one as I’ve had the pleasure of helping out on a film project that features a virtual world in a day-to-day context. More on that in the first few months of next year.

Pass – We were up front that this was an easy prediction due to our then under-wraps involvement with Beautiful Kate.

Prediction 3: There will be a net increase in Australian business in virtual worlds – Second Life won’t see any significant growth in Australian businesses entering Second Life and there may actually be a decrease. The gains will come in worlds like Twinity, customised worlds created on platforms like VastPark and possibly even some entry into enterprise worlds offered by entities like IBM and Forterra. Any increase will be driven by the increasing awareness of virtual worlds as a cost-effective business collaboration tool.

Fail – The withdrawal by Telstra from Second Life significantly reduces the level of overt Australian business presences on that platform. That said, the level of interest in virtual worlds has grown, albeit only slightly. The gains have come around collaboration and meetings. Most of the growth in interest hasn’t translated to dollars invested, but that’s on its way. Aside from Second Life, no specific platform is gaining significant traction locally from a business viewpoint.

Prediction 4: Virtual worlds will remain a political no-go zone – Australian political parties have had zero presence to date and it’s extremely unlikely to change in 2009. Any planning being done by the major parties for the 2010 Federal Election is unlikely to extend beyond services like YouTube and Twitter. Things may stretch to sites like Barack Obama’s Change site, but forget anything 3D.

Pass – As predicted, there’s no momentum politically with virtual worlds in Australia. Why? You’ll find out in coming weeks when we release our virtual worlds policy paper.

Prediction 5: Metaplace will be a game-changer – Metaplace’s simple, web-based interface combined with some impressive content creation tools will ensure a launch with impact and significant growth. There’ll be some obvious poaching of users from services like Habbo Hotel but also from content-creation havens like Second Life.

Fail – We couldn’t have got this one more wrong given Metaplace has announced its closure. Closures are expected in a competitive environment but this one was a real surprise.

Prediction 6: Virtual sex will lead to legislation – Linden Lab’s gambling, ageplay and banking clamp-downs were an early start to the reality of increased regulation and governments worldwide are increasingly scrutinising virtual world activities. Sexual exploits (aside from ageplay) have remained unregulated. For better or worse, this won’t remain.

Fail – no significant legislation has eventuated, although the proposed Australian internet filter will likely cover ageplay-related content, but that legislation hasn’t passed as yet.

Prediction 7: Australian Universities will fall further behind in incorporating virtual world training tools – Australia has some leading lights as far as virtual world and education go, something highlighted by AVWW 2008. In the wider university sector, US and UK universities are integrating virtual world training simulations in a range of areas including health and engineering. Australian universities on the whole haven’t begun thinking about this in a widespread way, even with the talented educators putting the case locally. 2009 will see the gap widen further as key universities overseas start to demonstrate significant education outcomes.

Pass – Australia has continued to lag, although the cohort of innovative educators involved with virtual environments has continued to grow and some impressive outcomes demonstrated (one example here). The lag to date comes from governing and funding bodies rather than at the grass roots level. That said it appears to be ending with some excellent, Australia-wide proposals in the works in regards to virtual worlds and tertiary education.

Prediction 8: Second Life will remain a frustrating experience – the announcement of standalone servers may prove this prediction wrong, but 2009 is unlikely to show an enormous improvement in the Second Life user experience. The user interface will certainly improve and the stability of the platform may improve exponentially. The ongoing frustration will be the same issue that’s plagued Second Life to date: regular, crushing lag. This is one prediction I’d particularly like to be proven wrong on. A sub-prediction here too: the Teen grid will continue to decline and may even close altogether.

Pass – Teen Second Life is likely to be merged into the main grid, there is somewhat of a decline in user concurrency in Second Life and although some user interface improvements have occurred, the main improvements are yet to be seen. Things are still looking very positive for Second Life overall, but the evergreen usability challenges remain.

Prediction 9: Growth, growth, growth – every metric and market research report points toward ongoing growth in the number of people spending time in virtual worlds. The new entrants will assist this growth but the incumbents will also grow. Habbo Hotel will most likely retain is dominance in raw numbers but children’s worlds like Barbie Girls, Hello Kitty Online and Club Penguin will provide an enormous userbase as well. Add to that the promising growth of Sony’s Home and you can see this is a safe prediction, but worthy of a mention.

Pass – As we said at the time, it was a no-brainer. In June 2009 the estimated number of virtual worlds users was around 186 million by one forecaster and it’s certainly grown since then.

Prediction 10: Virtual Goods will boom – the interest from business in virtual goods as a money-maker has accelerated significantly in the past six months in particular, and 2009 will see that continue. Second Life has been a leader in that aspect, followed closely by children’s worlds and gaming worlds. Goods will get more sophisticated, with much more real-world marketing efforts behind them. 2009 may also see some virtual goods out-rank popular real-life items in terms of sales and revenue.

Pass – driven by social games on platforms like Facebook, there’s been an explosive growth in the use of virtual currencies to purchase in-game goods. One industry study found that virtual currencies were the most traded virtual goods during 2009.

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Seven out of ten correct isn’t too shabby, although there were some fairly easy wins amongst them. Our 2010 predictions will be published in the coming week. In the meantime, what are your thoughts on how 2009 played out compared to how you thought it would?