This report provides an overview of the potential benefits but also limitations of virtual worlds for enhancing collaboration, creativity, and learning, and thus improving innovation performance across society. The report shows to what extent virtual worlds provide platforms for new and experimental interactions and can thus be considered a catalyst behind the changing nature of innovation. The report also examines the main drivers as well as barriers and challenges for the diffusion of virtual worlds. Given the lack of widely available data on virtual worlds, with the exception of virtual worlds as entertainment applications, this report is based on the analysis of use cases and examples of virtual world applications that have been discussed in the literature.
There are a number of barriers and challenges which need to be addressed to ensure the adoption of virtual worlds. Many of these challenges such as intellectual property rights (IPR) are not specific to virtual worlds, but rather a common challenge of internet platforms and of the collaborative web in particular. Other policy challenges, however, have intensified with the diffusion of virtual worlds. These include issues such as increasing requirements on broadband networks, lack of interoperability and standards between different virtual worlds, increasing skill requirements for developers and end-users alike, but also some regulatory issues such as the increasing risks of online addiction, the increasing significance of in-world transactions for taxation, and classification and measurement issues.