After seeing the movie 'The Matrix', Philip Rosedale starts a dot-com company and attempts to build a full-body virtual reality rig. He soon pivots to creating a virtual world on the Web.
Perhaps it was the end of millennium — and its attendant Y2K doomerism — mixed with the increasing sophistication of computer graphics. Whatever it was, 1999 proved to be a milestone year for the concept of virtual worlds.
Philip Rosedale was working for RealNetworks as its Chief Technology Officer in 1999 when he and some of his colleagues went to see a new movie called The Matrix. The movie was unlike anything that had come before, with its techno-apocalyptic virtual world plot that you needed at least two viewings to decipher, its computer green filter and cyberpunk costumes, and the astonishing “bullet time” special effects.
According to a later Rolling Stone profile, the RealNetworks crew went to a bar after the film to talk about what they’d just seen. Everyone was buzzing about the film’s vivid depiction of virtual reality. In the movie, the real world has been taken over by AI machines and humans have been turned into batteries, to power a complex virtual world. While the 3D computer world the machines have built is a picture-perfect representation of the world as it was during its peak years, Rosedale was troubled by the dystopian fate of most of humanity. He told his colleagues that night, “I’m going to build that! And it’s not going to turn out that way!”
What he eventually built — a 3D web-based world called Second Life — had its beginnings in 1999, soon after Rosedale watched The Matrix. He left RealNetworks to start a new company, at first envisioned as a hardware VR product nicknamed “the rig.” He rented a warehouse office on Linden Street, a narrow alley in San Francisco’s Hayes Valley, known at the time as a thriving area for multimedia startups. The location gave Rosedale the name for his company: Linden Research, Inc.
Dot-com Dreams: The Rig
Rosedale’s first hire was a physics engineer named Andrew Meadows. In a 2023 conversation between the pair, on Rosedale’s YouTube channel, Meadows recalled what it was like working in Hayes Valley in October or November of 1999, when the pair began work on ‘the rig.’
“The dot-com boom of the late ‘90s was still in force at that point,” said Meadows. “And there was a frenzy in the neighborhood. You know, you just saw it — all the people that you talk to, the traffic on the roads, the fact that you never saw a ‘for rent’ sign anywhere in the city […] and the ads that we saw on TV about all the hyped internet possibilities.”
‘The rig’, as demonstrated by Rosedale in 2024 on his YouTube channel, looked a bit like something you’d encounter in an optometrist’s office. You would be upright and have two padded rods connected to your forehead, to stop your head from moving. Likewise, your feet would be immobilised with two footrests. In front of you were three connected digital screens, one directly in front of you and one on each side — giving you about a 200 degree horizontal field of view (the vertical view was less).
The idea was that your body would make the motions of moving, but since it was constrained you wouldn’t actually move in real life — but you would on-screen. This sensation was achieved via “strain gauges” and other physical signals from your body that were fed into the computer.
Using this setup, explained Rosedale, “we were able to actually walk around as avatars in a very primitive virtual world, way back in 1999.” He added that because ‘the rig’ used your physical body as the base for what happened on-screen, there were constraints on what you could do with your avatar. “Swinging a heavy sword with both hands [virtually] will feel, in this simulator, exactly like it would if you were holding a real sword,” he said.
The goal by this point, late 1999, was to build a fully immersive rig that would allow you to enter a virtual world. Or as Meadows put it in his YouTube conversation with Rosedale, “the plan was to make a measurement of your intent of motion of the whole body.”
Pivot to a Web Virtual World
Needless to say, doing a full-body rig was a highly complex problem. So the pair soon switched from building VR hardware to creating a web-based virtual world, initially called Linden World.
But it was one thing to build a 3D virtual world around a specific storyline and with set scenes, as in the Omikron game that David Bowie featured in that same year. It was another thing to build a user-generated 3D virtual world that gave the user agency to create new experiences, which is what Rosedale and Meadows wanted to create.
Second Life would take several more years to build, and even then it would not be close to fully immersive. It was officially launched in June 2003, followed soon after by this promotional video:
So was something like The Matrix even possible, or just Hollywood fantasy? Most of the world thought it was fantasy, but in Silicon Valley the idea was taken somewhat seriously.
The concept of virtual worlds had been a part of the nerd zeitgeist ever since personal computers emerged in the early 1980s. The author William Gibson gave a name to it in a 1982 short story: “cyberspace.” That word, which Gibson used again in his 1984 novel Neuromancer, was later appropriated to mean an online computer network where people interacted with each other (as noted in an earlier post, Gibson also coined “the matrix,” to mean a virtual world in cyberspace).
Aside: as the screenshot above indicates, there were rumors of a 1990s movie version of Neuromancer. This never eventuated, but as of 2025 there is a TV series in production for Apple TV+.
In the early ‘90s, another term emerged: “metaverse,” coined by Neal Stephenson in his 1992 scifi novel, Snow Crash. Rosedale later claimed that his vision for a 3D virtual world predated Stephenson’s book. “When Snow Crash came out, I was already really intent on the idea of creating a virtual world like Second Life — I had been thinking about it and doing what small experiments I could since I was in college.”
The film The Matrix was, of course, an extreme extrapolation of the metaverse vision. In the story, the machines have simulated the real world right down to the finer details of a well-cooked steak.
“You know, I know this steak doesn't exist,” a Judas character called Cypher says, after he’s cut a particularly juicy looking morsel of meat. “I know that when I put it in my mouth, the Matrix is telling my brain that it is juicy and delicious. After nine years, you know what I realize?” He puts the piece of steak in his mouth and sighs. “Ignorance is bliss.”
Jumping Into the Network
Back in the real world of 1999, the internet — while not a completely blissful experience — was fast becoming an integral part of our daily lives. 1999 was “a watershed year” for the net, as a BBC report from the time put it. It was the height of the dot-com boom, broadband was gradually taking over from dialup to provide a faster internet, PCs were becoming ever more powerful, and tens of millions more people became online users.
People weren’t yet living on the net, but they were starting to log on every day to explore it. Which meant they were developing online personas.
If anything, the script for Omikron: The Nomad Soul was even more far-fetched than The Matrix. But it did somehow capture the feeling of what it was like to go online at that point in time. The following extract describes how David Bowie’s character, Boz, escapes into the virtual network after a struggle with a demon in his apartment:
“His battered body was lying in pieces on the floor. ‘I’ve only got one chance!’ Boz realized. Before the demon had a chance to understand, Boz slipped into the terminal's Transmaterialization compartment and was sucked in by the network, or rather, into the network, where he has become Boz, the virtual being.”
Many of us in 1999 could relate. Every day, we chose to jump “into the network” to become virtual beings in cyberspace — at least for an hour or two.
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