This article was written by Jemima Kiss, for guardian.co.uk on Monday 5th July 2010 10.14 UTC
Virtual worlds might have been an entertaining diversion for big media a couple of years back, but for a massive swathe of web users these are a powerful and important part of their online lives.
Far from being a flash in the pan, sites like Habbo Hotel can claim both longevity and profitability - both often elusive qualities for social web institutions.Photo by pixelsebi on Flickr. Some rights reserved
Habbo Hotel has just joined the exclusive club of websites that can claim ten years online. The public beta of the first incarnation, Hotelli Kultakala, rolling out on 28 August 2000, followed by the English-language beta on 16 January 2001. The combined platform now claims 170 million users in 11 countries.
Some Habbo stats, as of last month:
• 172m avatars created• 3m new characters created each month• 120m user-created rooms• 15m monthly unique users• Average user session is 42 minutes
In this video interview, co-founder Sampo Karjalainen describes creating the first incarnation of Habbo, the 'Mobile Disco' chat site with the familiar Habbo blocky pixel look. After extending the concept into a snowball fight for an ad campaign in early 2000, the pair launched the Finnish Hotelli Kultakala a few months later. The official bio says this was built with the micropayments business model in the plan from the start, though chief executive Timo Soininen admits in this video interview that in the early days Habbo was more 'hunch and creativity driven' than the multi-million dollar, metrics-driven organisation it is today.
However early on those micropayments were written in to the business plan, Habbo can claim some success. Parent company Sulake reported $20m revenues for the first quarter of 2010, up 25% year on year. The site has a not insignificant 150 payment channels set up across 31 countries, maximising their chances of encouraging players to upgrade their avatar and Habbo spaces by making it as easy as possible for them to pay in multiple ways. Soininen adds that a significant amount of transactions take place between users in the form of gifts and so on - to the value of $600m per year.
Success, says Habbo, is down to "keep the service fresh and relevant by frequently introducing new features and gaming elements, arranging engaging campaigns, enriching the virtual economy and payment models and nurturing the community". So no secrets given away there, exactly. But the combination of a distinctive style and an environment where users feel more committed to a service they have invested in is an important factor.
An overview provided by Nielsen gives a glimpse of user behaviour. In the virtual worlds category, Habbo notches up and average 2 hours 16 minutes each month per user and, though Nielsen estimates Second Life has less than half as many users, the average time spent is more like 9 and a half hours each month.
No surprise that web addicts' favourite World of Warcraft scores an astonishing 29 hours 42 minutes. Step away from the screen, gentlemen!
Actually that's not a sweeping generalisation about WoW, because Nielsen estimates that 72% of players are male. That contrasts sharply with habbo, which has a female userbase of 63%. Second Life is 55% male.
WoW's users are also older, with 41% between 18 and 34 while Habbo is 42% under 17. Second Life is older still, with 47% aged 35 to 49.
Habbo's own annual survey of 49,000 teenage users confirmed some more user behaviour. 32% said they never pay for content online, though that varies by country with 21% of UK teens saying they never pay compared to 48% in Spain and Italy.
55% said newspapers will die out soon, compared to 18% who think they will continue to exist in some form. One fifth said they often feel unsafe in online environments and nearly a third learn the most about online safety at school.
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