Back in 1999, a “virtual pet community” dubbed Neopets, debuted as a website for kids. Children created a Neopet as a personal companion to dress and care for while exploring the Neopet’s homeland of “Neopia.” By 2004, the site was reported to have tens of millions of members with over 108 million pets. Taking notice of its massive commercial success worldwide, Viacom stepped in and bought the company in 2005 for US$ 160 million, and re-launched the site in 2007 as a more sophisticated “Neopets 2.0” version.
According to Nickelodeon, Neopets now boasts “54 species of Neopets, 16 lands, hundreds of characters, stories and plotlines, 200 games, a virtual economy based on 'Neopoints,' daily and weekly creativity contests, Neovision™ video player, discussion boards, quests, and virtual items to collect, and most recently, NC Mall™, where users can purchase upscale tchotchkes for their pets.” As of 2008, it is the largest global kid-focused virtual world.
As companies took notice of the phenomenal success of Neopets and Webkinz (which offers a similar adopt-a-pet theme produced by plush toy maker Ganz), toy makers began tying real-world toys to online experiences. Russ’s Shining Stars, Bratz dolls, Build-A-Bear, Ty’s Beanie Babies 2.0, and Hasbro’s Littlest Pet Shop VIPs are among the more recent entries into the space as of 2008. All toys come with some version of a “secret code” that is used to register online within the accompanying virtual world for further avatar customization, mini-games (i.e., games within games) and typically some form of social networking, from chat rooms to Facebook/MySpace-style profiles.
Seeking to invigorate the toy-meets-virtual world formula, Playhut (makers of play tents and such) introduced in late 2007 two new virtual worlds for kids six to 13 years old called Wowbotz (for boys) and Mystikats Kutties (for girls). Rather than buying a toy product first to enter the virtual worlds, each accessory pack sold comes with its own set of mini-games which when successfully completed unlock codes that allow users access to new areas in the worlds.
As Joey Seiler, editor of Virtual Worlds News, told the BBC back in May 2008, "Successful virtual worlds encourage creativity, imagination, and fun.” It also seems to help when kids’ (and parents’) favorite brands participate in the virtual act.
Mattel and its iconic Barbie brand is the latest virtual world smash with a retail twist. As of spring 2008, Mattel enjoyed the fastest growing virtual world to date with its BarbieGirls.com, which combines a virtual world with a Barbie Doll MP3 player available in retail stores. Built by Studiocom, the same digital media agency responsible for Coke Studios, the site reached four million users after just a couple of months of its public beta run in 2007.
In a surprise twist, this spring, Mattel announced that it was abandoning its MP3 accessory and opening up the world to girls via a monthly subscription fee of US$ 5.95. Entrance is free and basic actions like chatting, dressing up and decorating rooms are as well. But there are also premium games and fashion options that are available only to V.I.P. players, which require the premium subscription. The world distinguishes the haves and have-nots by who has a sparkling tiara (V.I.P.) and who doesn’t (free users).
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I think this will not have a positive effect on children. It allienates them from reality and confuses them since they have "life" in two worlds. Don't like the idea of "virtual world" at all, I think we shall try keep our feet on the ground. 
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