NEW YORK While virtual worlds like Second Life still represent a fringe activity in the general market, more than half of the kids who use the Internet will be regular visitors to virtual worlds in just four years, predicts researcher eMarketer .
Virtual worlds -- game-like Web environments where users can create avatars in a fantasy landscape and interact with other users -- have become particularly popular among young children. Currently, eMarketer estimates that there are 6 million kids age 3-11 who visit virtual worlds at least once a month, representing 37 percent of that Web demographic. By 2012, there will be 8.7 million kids 3-11 using virtual worlds -- or 50 percent of the entire kids' online universe.
Teens are also fans of virtual worlds, though the penetration numbers are lower. In its new report, "Kids and Teens: Growing Up Virtual," eMarketer estimates that 3.7 million kids 12-17 log on to virtual worlds each month. That represents 18 percent of the teen Web population. By 2013, a quarter of the teen demo will be regulars in virtual worlds vs. 54 percent of the 3-11 group.
According to the report, the adult market has yet to gravitate to the virtual world segment in meaningful numbers. Therefore, potential virtual businesses have focused on the youth market. eMarketer cited a report by Virtual Worlds Management reporting that as of January, there were 112 virtual worlds aimed at the under-18 crowd live on the Web. Another 81 were said to be in development.
However, advertising is nascent in this space (most kids worlds rely on microtransactions for revenue). And given the current economy, many analysts predict a shakeout 
That’s also the assessment of eMarketer analyst Debra Aho Williamson, who authored the report. “The rate of development in virtual worlds targeted to the youth audience will slow as economic pressures mean less money for venture capital and for advertising to support new worlds,” she said. “But there is no denying that creating avatars and exploring virtual worlds are growing activities for many children and teens.”
Source: Mediaweek.com 
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