Some new pointers to one of my favourite topics.
BusinessWeek has an interview with Edward Castronova on the economies of virtual words. Here are some highlights:

I thought it was a fake economy. I found out that it really didn't feel fake at all. When I saw how it connected to the real economy, as you can see clearly in Second Life with its translation of Linden dollars into real dollars, and then you imagine how big this phenomenon could get, it started to have real-world macroeconomic implications.

[Second Life virtual world] It's an infinitely scalable content creator's dream. It's an extension of the land mass of the Earth. As long as somebody wants land to build on, Second Life will make land. If you're into creating content -- whether it's a building or a logo, anything -- it's just a dream space. That's what explains how it's growing.

This month's Wired (guest-edited by The Sims' creator Will Wright) has an article that suggests how virtual world are going to coalesce in a few years.

Within a decade, then, the notion of separate game worlds will probably seem like a quaint artifact of the frontier days of virtual reality. You'll still be able to engage in radically different experiences - from slaying orcs to cybersex - but they'll occur within a common architecture. The question is whether the underpinnings of this unified metaverse will be a proprietary product, like Windows, or an inclusive, open standard, like email and the Web. (The Open Source Metaverse Project is currently working on such a nonproprietary platform.)

But the most interesting news, from my perspective, is from Grand Text Auto, which reports from UCI’s Massive gathering:

One of the more intriguing things I’ve heard so far is about some developments in Second Life. They’re building an API into the system. It sounds like it might just be for pulling live data out of Second Life for use elsewhere, but my hope is that it will be possible to structure and control elements of Second Life via external processes (e.g., characters controlled by AI running outside Second Life’s scripting system). Similarly, they’re working toward an open source viewer that they imagine being customized by different communities. These might both open up interesting possibilities for researchers and artists.

Second Life has always been on the techno-social forefront in experimenting ideas on virtual words. Allowing programmatic access via an API is a major step forward, that is going to enable umprecedented possibilities. It also poses a lot of difficult challanges, so I'm really curious to see how the whole thing will be implemented.

See also: my older post Speculative finance and crafting in virtual worlds.