Monday, April 30, 2007

WSJ: Virtual Worlds Now Cater To Kids, but Are They Safe?

Virtual Worlds Now Cater
To Kids, but Are They Safe?

April 30, 2007; Page B1

Kaitlin Stanger often spends her $10-a-week allowance on trendy accessories like boots and thick-rimmed sunglasses. But the items aren't for her. They're gifts for "MuffinGal," the 13-year-old's character in the online world

Every day for an hour or more, Kaitlin logs on to the virtual dress-up community to catch up with friends and spend her Stardollars, furnishing her room with everything pink in addition to buying clothes. "You get to really show off your personality," says Kaitlin, of Salt Lake City, Utah, whose mom buys her a bundle of 100 Stardollars for $10. "It's not just a picture of your face -- it's your whole style."

Part socializing and part game playing, online virtual worlds targeted at kids and teens are sprouting on the Web. Their strategy is to offer social-networking with training wheels. The sites aim to give kids the interaction of a site like MySpace or a virtual world like Second Life without the potential exposure to inappropriate content or inappropriate people. But the sites are still struggling to earn the trust of parents, who wonder if their kids really know who is on the other side of the virtual park or pizza parlor.

[A scene from IAC's Zwinktopia, which will be introduced today.]
A scene from IAC's Zwinktopia, which will be introduced today

A variety of Internet companies are launching these virtual worlds, hoping to win the loyalty of kids at the start of their Internet years. Today, IAC/InterActiveCorp. plans to introduce its first such offering, Zwinktopia. Players will be able to create avatars, mix and match outfits and point and click to meet and chat with other users in teen-themed locations like bowling alleys and dorm rooms, paying their way with Zbucks, which they'll earn playing online games. (IAC and Dow Jones & Co. recently announced a joint venture to create a personal finance Web site.)

The sites shy away from advertising, for fear of alienating parents, especially those with younger children. Instead, online businesses are experimenting with a variety of business models, such as charging for virtual currency, selling subscriptions and bundling their services with toys.

Club Penguin, a popular online world founded in late 2005 by three Canadian fathers, is free to join but charges $5.95 a month for privileges such as the ability to buy accessories for your penguin. In the past year, its audience has quadrupled to more than four million unique monthly U.S. visitors, according to comScore Networks Inc.

Kids log on to the site, owned by New Horizon Interactive Ltd., to customize a virtual penguin and give it a name and a color. The penguins waddle around, playing games -- like sled races -- to earn coins that they can use to acquire flags, accessories and igloo furnishings. Penguins can also chat with other penguins through two chat modes: ultimate safe chat, which is limited to a predefined menu of greetings, and standard safe chat, in which all messages are subject to filters that screen for inappropriate language and personal information like phone numbers.

Competitor Webkinz, owned by toy and gift company Ganz USA LLC, is an online kid community accessible only via a code that is sold with one of dozens of plush animals like pandas, lions and poodles. The toys, which Ganz distributes through toy and gift stores, have sold out rapidly. Often the only place to find them is an online auction site, where they can be bid up to more than twice their typical price tag, usually between $7 and $12.

[A scene from the Webkinz virtual world]
A scene from the Webkinz virtual world

Once logged in, users can access an online world of backyards and games and chat from a limited menu of phrases like "I think you are cool." (Webkinz will soon expand its chat feature to allow kids to type what they want, as long as the words are included in its kid-friendly dictionary, which excludes words like "punch" and "call.") Kids cook virtual meals, customize their rooms and keep their pet's health-meter score up by returning daily.

Nine-year-old Maeve Higgins signed up for Club Penguin last year because it was all her fellow third-graders were talking about. "It's cool," says Maeve, who logs on most weekdays to buy helmets and shoes for her penguin and to play games. "I like meeting new people."

But not all penguins are friendly. Maeve says she occasionally comes across someone who makes her uncomfortable, such as one player who called her "mean" and another who threatened to rob a virtual pizza parlor.

Lisa Higgins, Maeve's mom, is concerned about what kids might say to each other on the site -- and whether they are even kids. "The thing that alarms me is the chat," says Ms. Higgins, who watches over her daughter's shoulder as she plays on a laptop in the dining room. "Are these 6-year-olds or are they 42-year-old men?"

Many sites require a parental email to sign up but acknowledge that they can't confirm the email account is indeed a parent's. "Realistically, there is no way to know," says a spokeswoman for Club Penguin. "Kids will always try to beat the system."

One possible solution: parents creating their own accounts to monitor their kids. Kaitlin Stanger's mom, Karrie, also joined Stardoll, which gives her an inside peek at whom her daughter is chatting with. Kaitlin -- who was made uncomfortable when a member once offered her "free" money in exchange for her password -- says knowing her mom can see her friends makes her feel more relaxed.

And Ms. Stanger, 38, is becoming quite a fan. "It's a fun, creative outlet," she says, describing her character as "a little thinner and a little bustier" than she is. After all, she asks, "where do you get to buy furniture for $2 or less?"

Write to Jessica E. Vascellaro at jessica.vascellaro@wsj.com1

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