Metanomics host Robert Bloomfield interviewed Second Life founder and Chairman of the Board, Philip Rosedale, on the record at the Second Life Community Convention in Tampa, Florida.  The Rosedale interview is now available.  Rosedale addressed several issues that involve legal and governance questions, and Robert asked me to post a brief reaction.  Robert has also lined up responses from Wagner James Au, Christian Renaud, Tish Shute, ‘Bettina Tizzy,’ Nic Mitham and ‘Dusan Writer.’

From a legal perspective, the big-picture story of the last two years for Linden Lab is that the company has recognized that with success comes visibility, and with visibility comes a heightened legal profile.  That means both better compliance with relevant laws — even when doing so annoys some customers — and it also means a greater exposure to liability.

These shifts also highlight a trend away from Linden Lab’s initial “hands off” stance regarding user behavior.  Rosedale confirms and endorses this trend, while recognizing that less governance is, generally, better than more, and that Second Life will ultimately end up being part of a larger global metaverse regulated by dozens of governments.

The relevant excerpt from the interview follows:

PHILIP ROSEDALE:  I would say our overall philosophy remains that, given that the system is global, so we have users from many countries, it’s likely to become more open and less locally regulated. That is to say, as people are running servers in their own countries, you’re going to have different regulatory regimes, and therefore, treatment of different content or experiences, whatever. What this suggests is that we need to really redouble our efforts to regulate and create central policies as little as possible, recognize that those policies will probably be fractured at international boundaries and by people who are running servers. Today we own and operate all the servers. We don’t believe that, long term, that’ll be the case. So as people are operating their own servers, they’re likely to have different policy and regulatory decisions. So I think our basic goal is what it’s always been. I think we’re staying pretty true to it. As the world gets bigger, there are things that we’ll do. It’s just to reasonably promote stability and the growth of the overall world while imposing as little policy or regulation as possible to do that. Every time we impose a policy of some kind, everybody’s going to say, “You’re taking away our freedom.” But—

ROBERT BLOOMFIELD:  Except for the people who are saying, “Finally!”

PHILIP ROSEDALE:  Yeah, or, “Thank you.” And, of course, everybody else is saying, “You’re too slow.” Sometimes, especially as it relates to governance and policymaking, I know what it’s like to be the President or something of a country. It’s been an intriguing experience because you really can’t please everybody on these global policy issues. And I think the only way you can please everybody is to simply have as little policy as possible. I really do think that is generally a maximizer. And so we try to pick our battles very, very carefully.

There are types of content where, if you do it, we will go after you. We don’t want the economy or the general quality of people’s experience to be impaired, and we’ll fight a little bit to protect that, but we really do recognize that, especially again with the use cases growing and the business models and the server models and stuff, open grids, all this stuff growing, it means that we probably need to be even smarter about moving toward… We’ll have less opportunities to set policy in the future even than we do today.

Five years ago, I suspect no one would have imagined Philip Rosedale saying that with “server models and stuff, open grids, all this stuff growing, it means that we probably need to be even smarter about moving toward… We’ll have less opportunities to set policy in the future even than we do today.”

Contrast this to Second Life’s first birthday, in 2004, where Rosedale said: “Virtual nations like Second Life will grow so rapidly that the real world legal will be forced to follow the things that we’re doing.  Hearkening back to Barlows’ famous rights of cyberspace, I’d say it’s the world that has to listen more to us.”

Times change.  In this case, for the better.

Linden Lab really “gets it” on legal issues now, to a far greater degree than it did even two years ago, when I started following this field closely.   Though complaining about decisions by Linden Lab remains a popular diversion for Second Life residents, policies over the last year (such as the trademark policy, the “banking” ban, and the ban on casinos) have undeniably been clearer and better thought-out than those of just eighteen months ago (like the fairly absurd initial statement banning “broadly offensive” content).

What’s different?  Linden Lab brought in a top-notch in-house legal team last year, headed by Marty Roberts, eBay’s former Deputy General Counsel, and that team has undoubtedly informed Rosedale’s and Linden Lab’s understanding of the role that law must play in guiding policy for the company and the virtual world of Second Life itself.

For Second Life to position itself at the center of a broader emerging 3D internet, it has had to shift from a geek outlaw paradise to a something that acknowledges both Second Life’s current place in the larger legal framework of the internet and Linden Lab’s future competing with companies based in jurisdictions with different, often less restrictive, laws.  It is a credit to both the company and Rosedale that the Second Life vision has matured to incorporate these realities.