Parallel Worlds: How the Video Gaming Industry Reimagines Real Estate
The 2020 MIT World Real Estate Forum went virtual for the first time this summer, drawing more attendees from various countries across the globe than in previous years. While the forum has always addressed a broad range of topics — from technological innovation and design, to climate change and resilience — this year’s program featured a particularly unique panel called Parallel Worlds: How the Video Gaming Industry Reimagines Real Estate. Moderated by Alina Nazmeeva and Dr. Andrea Chegut, the panel guests included Linden Lab CEO, Ebbe Altberg, and Giorgio Tarraf, Technology Intelligence Director at L’Atelier BNP Paribas. This session explored the economy and built environment within online games and virtual worlds, and how virtual real estate expands the world of physical real estate. The article is a summary of this fascinating conversation.
Virtual worlds, their economies, and the technologies that facilitate the development of virtual worlds, play fundamental roles in the daily life of billions of humans. With the COVID-19 pandemic, this has become more evident. More and more people partake in virtual worlds, invest in virtual economies, purchase virtual real estate, study and learn new skills online, play online games or spend time living out growing portions of their lives in the virtual. In more and more ways, real and physical structures mirror or extend one another
For virtual goods and virtual real estate, in particular, the study of virtual worlds becomes more relevant. From Augmented Reality art exhibitions to buildings in virtual worlds, virtual goods aggregate social, cultural and economic value. In virtual worlds, arguably, local community and location are as relevant as in physical cities. Foot traffic affects virtual businesses and unique designs attract more people. In turn, virtual worlds continue to become more sophisticated, and expand what possibilities and experiences they can create.
"The data speaks better than I do: nearly 100 million dollars have been invested in decentralized virtual worlds in the last two years, both on primary and secondary markets." -Giorgio Tarraf, L'Atelier BNP Paribas
Panel speakers for the Parallel Worlds session at the 2020 MIT World Real Estate Forum.
“In Second Life, you can create these kinds of places where people have a shared appreciation for the design and functionality. They become very popular, but there is always a maximum capacity of the number of people that can live in a particular neighborhood. There’s long waiting lines to be able to enter some of these neighborhoods. People also trade and switch neighborhoods that they want to be in. I call them neighborhoods, but those can have almost any design, it could be sci-fi, it could be a different time-period-themed neighborhood. There is a place, made by a Dutch woman, which is a replica of 1920s Berlin, where people who have a fascination with art, fashion, and music of that time period can rent a house. There is a tremendous value in that, because only so many people can fit in there. You know, it’s just like ‘location, location, location’ is still true in virtual space. -Ebbe Altberg, Linden Lab
“I definitely think of virtual worlds as an equalizer. And a lot of the things that physical space gives you an advantage in — whether it’s race, gender, geo-location — all of these things suddenly get sort of taken away because, as an avatar, I can be anything from anywhere in the world."
-Ebbe Altberg, Linden Lab
Virtual worlds have economies where their users buy, sell, trade, and monetize virtual assets, including real estate.
“These are platforms where people can own their virtual assets. Right now, when you buy a skin in Fortnite, you don’t really own that skin. You’re basically leasing an entry in a database controlled by the publisher. Blockchain technology and non-fungible tokens now allow users to own virtual goods and assets and trade them on open marketplaces with little restrictions…[Additionally,] many young people are able to have a side gig to supplement their income. Others have started companies building Minecraft worlds, renting and selling them on a marketplace, and they can generate significant revenue. Many of these people may not have found these entrepreneurship opportunities in the real world, and we should not be dismissive of their success.”