Linden Lab plans to open up the source code for Second Life's servers, allowing anyone to run their own version of Second Life, a company spokesman said today, confirming the widespread belief among many in the 3D community that open-sourcing the servers was inevitable.

That leaves Linden Lab's business model up in the air. The company now generates revenue by selling land in the virtual world -- translation: Allowing customers to lease LL's proprietary server software, running in SL's data centers. How will the company make money if anybody can do that? Well, several ways that I can think of:

• Continue in the land-sales business, only now they'll have competition.

• Provide proprietary extensions to Second Life.

• Become a not-for-profit, coordinating Second Life development on behalf of other companies doing business in Second Life.

• Consult to other companies doing business in Second Life, going into competition with companies such as Electric Sheep and Millions of Us that now provide that service.

That's just off the top of my head.

Going to open source will make a huge difference in the Second Life experience. Now, the world looks like a single place, just one giant server, to the end-user logging in to Second Life. This is most obvious when response times are very slow -- a condition users call "lagginess" -- because too many people are logged in at once. Also, on some days, like tomorrow (Wednesday, April 18) at 7 am to 10 am PDT, Linden Lab brings the whole world down for maintenance.

Over time, Second Life will come to look more like the Web, a vast network of myriad servers connected by some common navigation, protocols, and client software. Huge traffic on one area of Second Life will not impact response times elsewhere, any more than huge demand for one Web site impacts response times for others.

The move to open source confirms a widespread belief in the Second Life community that Linden Lab had decided to open up the source code to the server, just as it open-sourced the client in January.

Nonetheless, Joe Miller, VP of platform and technology development for Linden Lab told me earlier this year that open-sourcing the server was not yet decided. I wrote in a March 5 article:

For now, Linden Lab is the only company that runs sims. It derives the majority of its revenue from land sales. However, that will change, as the company is committed to allowing others to run their own sims on their own servers.

While many Second Life residents are convinced that Linden Lab will release the server source code as open source, in fact that hasn't been decided, says Miller. Linden Lab might simply decide to license the code to other companies, the way vendors now license any application. Linden Lab might publish all the APIs, and allow other companies to build clones of the Second Life sim software. Linden Lab might simply allow other companies to provide the hardware, which Linden Lab would run at its own co-location facility, running Linden Lab's software. And there are other options as well, which Miller declined to elaborate on.

I'm working on lining up an interview with Miller, or other high-level SL execs, to clarify and expand on the plans.

And thanks to journalist Wagner James Au, who tipped me off to the change in open source plans in comments he made while being interviewed by Henry Jenkins at the blog Confessions of an Aca-Fan. Read the whole thing -- along with part two -- it's quite insightful. Au is extremely knowledgeable about online games in general and SL in particular, I've been a fan of his work for years, long before SL even existed.

(By the way, he and I aren't related.)

Miller disclosed the open source plans in front of an audience at the Virtual Worlds 07 conference a couple of weeks ago..

The blog 3PointD.com quotes Miller as saying: "We’ll be open-sourcing the back end so sims can run anywhere on any machine whether trusted by us or not. We’ll be using open protocols. SL cannot truly succeed as long as one company controls the Grid."

However, Miller's plans don't seem to have been widely reported, and the places it was reported focused their articles on other things..