In December I wrote a blog post that predicted that over the longer-term Second Life fails because there is no governance.  I am a big fan of SL, but to me it increasingly resembles some sort of phishing scam.  In one month, I had games of chance that didn’t pay out on winning hands, vendor machines that took my money but offered no merchandise, and watched mini-organized crime groups rotate through avatars on a weekly basis to engage in fraud against SL residents.  Linden Labs, the creators of SL are no help in the matter as they always provide a canned response:

Linden Lab cannot verify, enforce, certify, examine, uphold or adjudicate any oath, contract, deal, or agreement made by the residents of Second Life. This includes the odds, operation, payouts, etc. of any gambling or “casino” scripts.

Whenever you are talking about real money, and this point SL is talking about Real Money the world will fall apart if there is no governance.  Someone has to prevent fraud or SL fans like myself get frustrated and look elsewhere.  From a long-term standpoint, I was pretty discouraged that SL will simply fail, not in a financial sense, but in the sense that is never realizes its full potential as a disruptive technology.

However, I was encouraged to read this interview with Mitch Kapor, the Chairman of Linden Labs’ board.

We’re focused on building out the company. The grid has to stay up 24-7, the frame rates have to go up, we have to make it easier to use, it has to become more civilized, there are all sorts of governance issues. All that is a hundred times more important right now than worrying about cashing out. I am not thinking about a liquidity event. Link—>

Nice to see at the leadership level they at least recognize their own problems.  Maybe they will address this after all.