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The science fiction novel Simulacron-3 was first published in 1964 by Daniel F. Galouye in the United States.
The book tells the story of the operator of a virtual city which is used for marketing research purposes. The simulation is so perfect that the inhabitants possess their own consciousness and do not notice at all that they exist only as electronic impulses in a computer. In the course of time, the protagonist notices increasingly that his world is not material, but also exists as nothing more than a simulation in a higher reality.
Probably influenced directly by Philip K. Dick's trumanshow-esque novel Time out of Joint, Simulacron-3 can be rightly regarded as the first description of virtual reality, even if the topic was already treated more than two thousand years ago in Plato's allegory of the cave. A similar philosophical foundation supplied René Descartes with his maxim: "I think, therefore I am."
The novel supplied the basis for the great cinematic success of 1999's The Matrix, and was even filmed twice itself: first in 1973 by Rainer Werner Fassbinder as a two-part television play under the name Welt am Draht (World on a Wire), and in 1999 by Roland Emmerich as The Thirteenth Floor.
Ironically, the novel does not supply an explanation for the term "Simulacron," and the expression is not even used in the book.
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