Responding to Google's launch of its new virtual world, Lively, avatar and 3D virtual spaces platform IMVU's president and CEO Cary Rosenzwieg commented that while the search giant will likely find success quickly due to its resources and ability to leverage of "billions of visitors," the virtual spaces category is big enough for both platforms to thrive.

He went on to draw comparisons between the two services: "The core of Lively content are: avatars, rooms and catalog. This is true for IMVU Credits as well, though IMVU offers home pages, groups, forums and more. In particular, Lively chose the IMVU-like metaphor of the virtual "room" instead of a sprawling virtual world. So, people might start thinking of the virtual world space with IMVU Credits and Lively at one end, focusing on avatars and rooms, versus Second Life and others with large tracts of virtual land."

The CEO then noted that the similarities between IMVU Credits and Lively are predictable considering that Lively's head of 3D, Mel Guymon, was one of IMVU's five co-founders. According to Rosenzwieg, Google offered to buy IMVU in October 2005, right about when development on Lively started. All of the co-founders rejected the offer except for Guymon, who later left the company to work at Google.

Established four years ago, IMVU Credits did not come out of stealth mode until just a few weeks ago, announcing that it had reached over 20 million registered users and that it now offers 1.7 million items in its virtual goods catalog. According to VC firm Menlo Ventures, IMVU generates $1 million in revenue per month through its micro-payments economy. The service offers virtual credits which users can purchase and spend on user-created goods.

Google's backing of Lively represents serious competition for IMVU Credits, however: "Google is rich and powerful. As an Intuit veteran, I have first-hand experience in this kind of battle. At Intuit, we fought off waves of product attacks by Microsoft against Quicken, TurboTax and QuickBooks. We always won because we were fanatically devoted to consumers, and so our products were simply better. In this case, Google is formidable. They are likely to be extremely successful quickly because they are rich and can leverage seemingly billions of visitors. The category will be big enough for both of us to succeed."

Rosenzwieg concluded, "We believe in giving our customers lots of choices. We assume with Google's power, Lively should catch up with IMVU Credits soon."