Featured News

It has been several weeks since we announced that Teen Second Life, our Second Life grid for 13- to 17-year-olds, will be closing at the end of this year, and that we would be admitting 16- and 17-year-olds to the main grid. Today, we are excited to tell you that we will be able to continue serving all of the educational and not-for-profit communities of the Teen Grid, including those that serve 13- to 15-year-olds, without an interruption in service.

Since our announcement, we’ve been speaking with many people from the educational and not-for-profit communities in Teen Second Life to better  understand their needs and determine what measures would be necessary to create a safe, secure, and collaborative environment for their students and faculty. I’m happy to say that we are able to meet these needs, and allow 13- to 15-year-olds access to limited locations on the main grid, with appropriate controls for administrators. We will implement these controls and transfer these rich and exciting projects from Teen Second Life before the end of this year.

The 13- to 15-year-old students affiliated with these organizations will be unable to visit any regions except those of their hosting organization, and those accounts will not have the ability to search the Grid or to purchase items from the Marketplace. Unlike on Teen Second Life, adults that work with these students will now be a part of the broader Second Life experience, allowing them to bring rich educational content to their students. The ability to invite organization-approved guest speakers and other approved members of the community to safely interact these students will further enhance their learning experience. For more details, see the Teen Second Life transition wiki page.

We are happy to provide this support for the educational community in Second Life, and we look forward to the community continuing to create  innovative and exciting projects!

In January of this year, Linden Lab purchased Avatars United as part of our social strategy and a larger ambition to integrate powerful social networking capabilities into the Second Life experience -- to make it even faster, easier, and more fun to find friends, build vibrant communities, and share the richness of Second Life with fellow Residents inworld and friends outside of Second Life. We purchased Avatars United for its underlying social technology -- the ability to create social networks, communities and groups.

During Philip’s keynote at the 2010 SLCC, we committed to bringing Mesh import to Second Life. This functionality would allow content created in the mainstream 3D creation tools, such as Maya or Blender, to be imported directly into Second Life, in much the same way that animations and textures can be uploaded today. In this case, we would provide support for the Collada file format. We see this as an important step to empower content creators to make the inworld experience an even richer and more creative one than it is today.

Find Out What Our Mesh Import Beta Testers Think

As you know, we have been working on Mesh import for some time and have had an awesome group of Resident beta testers helping us to iron out the kinks. Those testers have been under NDA, but today we will be lifting that NDA so that those folks in the closed beta can talk publicly about their experiences with Mesh in Second Life. This is in line with our desire to be ever more open about what we are working on. Look for other videos, blog posts, and Tweets (#slviewer2) shortly.

In fact, I encourage you to view the Second Life Youtube channel where we already have six videos showcasing Mesh Import technology, contributed by beta testers Draxtor Depres, Timmi Allen, and Matrice Laville.

And, big thanks to all of our Mesh Import beta testers. Your dedication, creativity, feedback, encouragement, and patience has been invaluable. We couldn’t have gotten here without you.

Open Beta Coming Soon
We’re also getting ready to move from the current closed beta, to an open beta so that any Resident interested in helping us to test the Mesh toolset, or just curious about the technology, can get involved. Mesh Import has some incredibly exciting implications for inworld content creators, so we’re very keen to get as much feedback as we can; and of course, the more people that use it, the better the feature will be when we go live gridwide.

The plan is to blog again in two weeks, when we’ll announce when the open beta will be available and talk more about the development process and the remaining work to be done. As you’re starting to see on other projects, there will be a specific Project Viewer for the open beta for Mesh Import that will take Residents to a development grid where Mesh is enabled. The open beta will be a ‘technology demo’ rather than being a complete product -- so you should expect that the user interface will change significantly as we receive your feedback and continue to work on it. The technology for Mesh Import is complex, so making sure that it is not only easy to use, but also a powerful tool for content creators, is part of the challenge. We’re looking forward to getting your help.

The L$/US$ exchange rate briefly experienced fluctuations for approximately one week in June. At the time, we interpreted this as being due to a number of factors, including uncertainty over our recent reorganization. Further research has shown  this was also caused by the effect of merging Residents’ inworld and XStreet SL account balances in late March. Previously, Residents had two separate balances: one for inworld transactions, and one for XStreet SL transactions. Merging those balances provided a more convenient, efficient way for Residents to maintain and spend their L$ balance. Residents are no longer keeping a higher than historical average L$ balance across their two accounts and this process of reducing their  total balances caused new L$ purchases to temporarily be lower while  these “extra” L$ were used and/or added to the selling volume if the L$ were taken out of the economy. At this time, total Resident L$ balances have stabilized and are no longer falling.

Despite this temporary uncertainty and related market impact that caused sell volumes to briefly spike beyond purchase demand during one week, trading activity and the exchange rate have since returned to near historical levels.

The L$ exchange rate is a floating rate that can change based on supply and demand. Although Linden Lab employs a variety of methods including  sinks, sources, and selling L$ from time to time, and tries to maintain a relatively stable money supply and exchange rate, we are committed to allowing the economy to fluctuate based on its own market forces. As in the real-world economy, these market forces can sometimes result in changes that can affect businesses positively or negatively in Second Life.

For more information on the Second Life economy in the second quarter, read today’s blog post.

The Second Life economy remained stable in the second quarter of 2010, despite one-time events that affected a number of metrics. The most notable economic event of the second quarter was a temporary decrease in the exchange rate of the L$ vs. the US dollar in mid-June that has since returned to typical levels. Our research in the weeks since this occurred indicates this change was due in large part to our merge of Residents’ inworld and XStreetSL L$ balances.This had the temporary effect of reducing L$ purchase volume as Residents lowered the total amount of L$’s they were holding because they now had one combined account.  Previously, Residents held a higher combined L$ balance in two separate accounts and purchased L$’s more frequently when they were keeping a minimum balance in each.  You can read more details in our quarterly economic spotlight post.

Changes in Reporting

From time to time we will change our reporting in order to provide the most relevant and accurate summary information for the use of merchants, landowners, content creators, and other participants in the Second Life economy. Our goal is to provide those who participate in the economy and run inworld businesses with the data they need to make informed business decisions.  We are making a change from the recent past by reducing the relatively large set of metrics we have provided--many where causality is complex or unclear--and we will instead provide a more focused data set with a briefer description about each quarter’s activity.  We believe the indicators below are the key items to focus on, and we are adding a page describing the content and methodology behind each figure.

In addition, we will be phasing out the data feeds at http://secondlife.com/statistics/economy-data.php. We’ll have more updates on this shortly, but because this data currently bears little relationship to the health or strength of the Second Life economy, we feel it’s appropriate to discontinue these feeds.

Resident-to-Resident Transactions

At least for the time being, one figure we will no longer publish in our historical charts is the Resident-to-Resident transaction data. As we’ve analyzed this data we believe that it is not as accurate a measure of the inworld economy as we would like. We are currently working to develop a more accurate metric with which to replace this number. For the near term, we will continue to publish a comparable Resident-to-Resident transaction figure for historical comparison. In Q2 2010, Resident-to-Resident transactions totalled approximately L$40 billion, or US$152 million.

RESIDENT USAGE INDICATORS

MONTHLY REPEAT LOGINS

Monthly Repeat Logins indicated improved retention and engagement over recent quarters:

• Q2 2010 averaged 805 thousand monthly repeat logins, a rise of 8.6 percent vs. the Q2 2009 average of 742 thousand.
• Levels are flat with Q1 2010.

USER HOURS

User Hours were slightly lower, at 108 million for the quarter.

• The Q2 2009 User Hours figure of 126 million includes substantial usage attributable to “bots” and other scripted agents. Bot policy changes took place in mid-Q2 2009, making it difficult to make accurate comparisons with the year-ago period.
• User Hours in Q1 2010 totaled 116 million.

MONTHLY ECONOMIC PARTICIPANTS

Monthly Economic Participants (those accounts that receive or distribute L$ in a given month) are the most active and engaged participants in Second Life and the economy. Economic participation in the second quarter, on average, was flat against the previous quarter, and rose against the same period a year ago.

LINDEN DOLLAR RATES AND RELATED METRICS

EXCHANGE RATE

The average Linden dollar exchange rate moved from approximately L$261 per US dollar at the beginning of the quarter, to just under L$269 per US$ at the end and fluctuated across a larger range for two weeks during June (see second chart below), as we noted at the time. Average exchange rates, however, remain largely unchanged. As noted above, our research indicates this change was due to our merge of Residents’ inworld and XStreet SL L$ balances and temporary market uncertainty immediately after the announcements of our restructuring and changes in senior management. Read more details in our quarterly economic spotlight post.

L$ SUPPLY

We are also improving and changing how we report the L$ Supply figure with this quarter’s post. Previously, this metric did not include individual XStreet SL account balances, and misclassified some administrative accounts as Resident accounts. For this quarter we have updated the calculation to include only Resident accounts, and have summed their balances across both XStreet SL and inworld. This number now more accurately represents the total purchasing power of all Residents in Second Life. Note that we have shown both calculation methods in the charts.

• L$ Supply in Q2 was US$25.9 million vs US$26.2 in Q1

LINDEX VOLUME

Historically, LindeX volume has been very stable, and the slight decline from Q1 is within past ranges. This metric is traditionally less volatile than many other indicators we report, and we expect this behavior to continue.    

• LindeX trading volume of US$29.4 million in Q2 2010 was up slightly against the year-ago Q2 volume of US$29.1 million, but off from Q1’s US$30.7 million

XSTREET SL MERCHANDISE SALES VOLUME

Q2 2010 saw 39% growth in sales over Q1 2010 and 124% growth over the same quarter a year earlier. The primary driver of this growth was the merging of users’ Xstreet SL and Second Life Linden dollar balances. This simplified the purchase process on Xstreet, producing an immediate jump in sales volume. In addition to the benefits of the balance merge, we continue to show healthy growth from the acquisition of new users paired with the development of new creative products from our merchants. Q2 continued the trend of setting record sales volume and this quarter in particular contained an important milestone, as Xstreet SL had it’s first month with over US$1 million worth of sales.

LAND

WORLD SIZE

World Size grew to 2,110 square kilometers at the end of Q2, from 2,070 at the end of the previous quarter, and 1,900 for the year-ago period. Private regions accounted for the largest portion of inworld land (44 percent), and private homesteads the next largest (36 percent). Mainland regions accounted for 19 percent of the total inworld land mass.

As of 10am PT Wednesday, September 8, the Emerald Viewer will be blocked from logging in to Second Life as a result of violations of our Policy on Third Party Viewers. Residents who have been using any version of the Emerald Viewer will need to use a different Viewer to access Second Life. You can download the official Second Life Viewer, developed by Linden Lab, here. Or you can learn more about alternative Viewers, developed by third parties, here. There are several new Viewers listed in the TPV Directory, so there are many alternatives available to you.

We take Residents’ privacy, safety, and security very seriously and will take action to enforce the policies that help protect it. As our CEO, Philip Rosedale, has blogged about, we recently removed the Emerald Viewer from our Third-Party Viewer Directory due to violations of our Policy on Third-Party Viewers.

Since then, we have been in communication with the Emerald development team and have requested several changes in order to remedy violations of our policy, including changes necessary to meet our privacy requirements, and to address GPL license violations. Unfortunately, the team was unable to comply within a stipulated time frame. As a result, we have decided to block logins from the Emerald Viewer in order to protect our Residents. All versions of the Emerald Viewer will be blocked from logging in to Second Life as of tomorrow at 10am. Please be aware that attempting to circumvent our blocking to access Second Life with a banned Viewer is a violation of the Policy on Third-Party Viewers and may result in the loss of one's account.

Linden Lab recently welcomed a new addition to its executive ranks: Kim Salzer, who became our Vice President of Marketing, at the beginning of August. Kim (known as Kim Linden inworld) joins us from Activision Blizzard, where she was Vice President of Global Brand Management for properties like Guitar Hero and Call of Duty 2, among others. Kim brings a deep background in gaming (including experience at Electronic Arts working on massively multiplayer online games and hit sports franchises), and in online learning, and we’re excited to have her as part of the team. As an introduction to Residents, I asked Kim to tell us a bit about herself in her own words:

Q: What’s the one thing you bring from the gaming world that will be most useful to you in your position at Linden Lab?

A: Working in gaming taught me a lot about just how creative and  passionate that audience can be, and I think the same is true for the  Residents of Second Life. And SL provides so many great tools to enhance  and bring out that creativity, I’m really looking forward to helping foster that as we move into the next phase of the platform’s growth. I  want to see if we can make the range of what’s possible in Second Life  even broader.

Q: What are your goals for your new position as VP Marketing at Linden Lab?

A:  What I really want to do here is help the Lab figure out what the “X  Factor” is going to be for Second Life. When I was working on games, I  always tried to choose a single idea to focus on and bring out, an X  Factor that helped people get into the game and helped them discover all  the rest of the possibilities there. If I can help bring that kind of  focus to Second Life, I’ll be happy about how I’m doing my job.

Q: What excites you most about working on a product like Second Life?

A: I’m excited about the prospect of helping to build a product that  really empowers people to express what they’re about, and that can make a real difference in their lives. I think we’ve only just started to see  what can be done here, and I can’t wait to see where we and our  Residents can take things from here.