Ondrejka was part of the team that wrote the computer code that underpins Second Life according to The Associated Press. The site is a 3D online destination where users create, buy and sell islands inhabited by avatars, somewhat like SimCity.

Philip Rosedale, CEO of Second Life said that Ondrejka resigned to “pursue new professional challenges.” He also said in the statement that “The needs of our company are changing, and the role of CTO, or technical lead, has also evolved. Cory and I are in agreement that our paths, at this point in time at least, lie in different directions.”

The site has been criticized for technical problems of almost every kind. Graphics load slowly, hackers have been an issue and avatars have appeared unintentionally naked. Ondrejka has even appeared in Second Life as the Flying Spaghetti Monster – a reference to the farcical religion “Pastafarianism.”

Before going to Linden Lab in 2000, Ondrejka was a programmer for Pacific Coast Power and Light, a video game developer.

IBM has been working inside Second Life for at least a year to bring real-world business and social operations to the virtual world. Last month the company held a virtual “block party” inside Second Life as part of its Greater IBM program to reach out to IBM alums scattered across the globe. IBM, along with China’s Palace Museum, is also developing a virtual version of the Forbidden City to help virtual denizens experience Chinese culture.

With the $10 million, IBM eventually wants to develop a private 3D world that employees can use to discuss private business information. Several IBM-owned islands inside are already private. According to the Reuters news bureau inside Second Life, there are more than 230 IBM employees regularly spending time in the virtual world.

IBM calls its operations in 3D virtual worlds “v-business” (v for virtual) as opposed to “e-business.”

“When I went to this conference center that they had created, it was incredible,” said panelist Raz Schionning (Second Life name: Razor Rinkitink), director of web services for American Apparel as he described his virtual experience, “I’ve done lecturing before, and you step up in front of a room and you see a lot of people out there, and there’s lights, there’s a microphone. There’s a certain feeling—excitement or intimidation, or whatever you might have looking out at the audience as you get ready to speak. If you’re sitting in front of your keyboard, you probably wouldn’t have any of that. But it was remarkably realistic. It really felt like a conference.”

In the June issue of the Harvard Business Review, senior editor Paul Hemp (SL: Hempman Richard) wrote an article called “Avatar-Based Marketing.” His article examines marketing and advertising, and how it applies to the virtual personas (called avatars) people create for themselves in environments like instant messagers and chat programs to full-blown 3D digital worlds like Second Life. In order to take things one step further, Hemp, along with Rodica Buzescu (SL: Ansible Berkman), coordinator for all of the Berkman Center’s activities within Second Life, organized the Second Life marketing panel. “It covered a gamut of topics ’cause, especially now there’s a lot of big companies circling this space as the next realm to advertise,” said panelist W. James Au (SL: Hamlet Au), Second Life journalist and blogger.

The Sandbox Economy
Second Life’s society is based on creating, buying, selling, and marketing virtual objects. Every Second Life user has access to 3D modeling and scripting tools to create their own clothing, machines, buildings, vehicles, whatever. They also retain intellectual property rights for anything they create.

Players in the game use Second Life’s in-game currency called, Linden Dollars, to buy and sell their creations. L$250 is worth about $1 USD. Second Life’s economic connection with the outside world means that it’s entirely possible to run a real business entirely within the game. According to Au, there are thousands of Second Lifers doing just that. “When I say a few thousand, that’s the estimated amount of people who make over 20,000 US dollars a year by buying and selling user content.”

And where there are goods to sell, there will always be advertising and marketing services to sell those goods. “There’s already an active thriving advertising industry in Second Life like…billboards [and] a lot of viral advertising,”said James Au. “Fashion tends to be the most popular item to buy. The fashion designer will get their friends to wear their clothing and go to the cooler nightclubs and stuff to build up an audience.”