This report assesses the Massively Multiplayer Online gaming (MMO) sub-sector of video game playing, and the most popular virtual worlds, such as Second Life and Habbo Hotel. When Mintel last analysed this market, in November 2005, MMOs, then widely known as MMOGs, were still very much in their infancy, in terms of mass-market acceptance and knowledge. Now, thanks to the likes of World of Warcraft (more than 9 million subscribers worldwide) and various MMOs aimed at kids, they are threatening to break into the mainstream video game sector.

However, developers are in danger of polluting the market through the massive choice available and rushing out titles that don’t further the genre, and which could, in fact, hold it back from legitimising itself. One of the ways in which developers can insure against this is to combine new technology with virtual world characteristics and make them a more complete experience.

There are few people in the industry who do not believe that virtual worlds are the next big evolution for the Web, with bricks-and-mortar businesses looking to exploit high active user numbers. The key will be whether developers, publishers and other concerns can turn virtual reality into real profits.