Big Blue Goes Virtual

IBM(IBM Quote) took a gigantic step into Second Life on Friday, unveiling 12 linked virtual islands created as an experiment in how to apply 3-D environments to business and real business problems, including a business plan for Circuit City(CC Quote).

IBM is the latest real-world enterprise to extend its brand into Second Life, the 3-D online world created by San Francisco-based Linden Lab. The tech giant joins the ranks of Dell (DELL Quote), Cisco (CSCO Quote), Toyota (TM Quote) and Sun Microsystems (SUNW Quote), all of which have set up homesteads in the virtual world.

Earlier this year, IBM announced it would launch a new business around virtual worlds and 3-D Internet. The 12 IBM islands, the company's collective work in the virtual world, will be opening to the public next week, with a major focus on virtual business, collaboration and education, and innovative experimentation.

"We did not just 'big bang' arrive. We have built up, learning what it means to be part of this community," says e-predator Potato, the in-world avatar of a real-life IBM architect Ian Hughes. "We now have over 950 [IBM employees] in Second Life. Everyone is encouraged to explore and learn."

The virtual business, or v-business, segment explores how real-life companies can extend business opportunities into virtual worlds, and also how to apply virtual worlds to business problems and opportunities.

"We will be coming to more business things soon," says e-predator Potato. "We are exploring and learning on all aspects. The social aspect and bonds between people is very important."

During a private tour, the IBM virtual-world architect introduced a design for one of the company's paying customers, Circuit City. While the design follows a typical store layout, IBM has integrated new features to enhance the experience.

For example, there are plenty of flat-panel and LCD televisions on display in the virtual store. IBM, though, found a way to put different streaming video on each of the screens. In addition, there is a feature that suggests which size television will work, depending on how far a person is seated from a wall.

Around the Virtual Circuit Let your mouse do the walking

And while there are plenty of virtual Microsoft (MSFT Quote) Xbox consoles, Nintendo portable DS systems and even Apple (AAPL Quote) iPods on display, unfortunately residents are unable to add them to a shopping cart.

"Circuit City is public with us as of [Friday], so it is a start," says e-predator Potato. "It's a test bed for the model. It links to real things, and as we get deeper we will get more real interaction, [such as] buying things in Linden to get the real product."

However, the IBM architect is wary about the potential social barrier that exists between spending U.S. dollars in the real world and spending Linden, the in-world currency of Second Life, in the virtual world.

Streaming on the Shelves Video within video

"The prices would be very high or appear to be," says e-predator Potato. "That's not to say it won't happen." For instance, I bought my custom Reebok shoes for 100 Linden. In the real world, it would cost several thousand dollars."

In addition to developing business models, IBM has a focus on collaboration and education. That is, the company is focusing on how to extend virtual worlds to help business collaborate both internally and externally in ways that more closely resemble real life.

In the real world, IBM offers an architectural approach called service-orientated architecture. The company says the goal of SOA is to help users build composite applications, which are applications that draw upon functionality from multiple sources within and beyond the enterprise to support horizontal business processes.

In Second Life, IBM is extending what it has developed on a 2-D Web site and has created a 3-D hub to help its customers in real time.

At Your Service Ready to meet your virtual needs

"I find this has many possibilities that I would have never been able to achieve in 2-D," says Anita Cassini, the operator of the IBM SOA hub in Second Life. "The beauty is that I can talk to customers in a different way at the same time that I am giving them the information they are looking for."

Lastly, IBM says that innovation experimentation is key to working with a broad community to push the limits of what is possible with virtual worlds and to build a community to help build out the next-generation Web, one that is immersive, interactive and 3-D.

"We find that all areas of our business are touched by virtual-world possibilities," says e-predator Potato. "We have tried to make sure we do this with integrity and make it good, serious and fun at the same time."