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Loki Eliot

Private Regions Struggling to make Tier under changed Economic landscape

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In the past Private Island Landlords bought Full sims with the intent to make costs back via rentals of Parcels for private land and shopping space. I have witnessed across many Regions amongst my friends that shop space rentals are in decline as is interest in renting land for homes.

I have a few ideas of why this is.

1) Market Place is taking away the need to have an inworld shop.

2) Linden Homes are out pricing private region land.

This is leaving us with an inability to sustain the Private Island Tier. 

Rodvik has said there are no plans to change the pricing structure so what are possible ways to counter this changed economy? 

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There's very little point in having an in-world shop if it can't be found it using the in-world search. Search is so borked and biased as to useless. Hence in-world shops become less relevant to users and consequently less interesting to merchants. Maintaining a neutral platform is an arcane skill that appears to be beyond contemporary Linden Labs. That inability may kill the platform ....

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How about the RL economy still stinks and things are tougher then in the good old days. Do I have lunch at work or buy the new coat at sf designs? There was an equally successful online shopping website-possibly even more so if you listen to the complaints now that the Lindens own it. I tend not to buy clothes or hair or plants on the marketplace...I prefer to see them in game. Frankly alot of the stores don't last because their products arn't very good or are better done by others.

Have premium memberships gone up any in the last year? I'm thinking rather that people have decided that a home isn't really a neccesity to enjoy the game. Not considering the econmic constraints of today. Things are tough out there...I've been out of work for 3 months now. Frankly I'm not sure how much longer I will be a part of the economy in game..

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Everyone is struggling to make it.

The economy is hell on most people and after 3 years of recession it will start to mount up around this time. You may start seeing more drop offs. Price of gas going up sky high. People have to chose from RL necessities or an online gaming.

Linden Lab didn't make 30% staff cut just because things are booming

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It depends who your market is if you have limited yourself to a certain niche don't expect the results to be so great, not everyone in SL has the same tastes as you. The landowner I rent from has about 100 sims or so and he is doing really well and last I heard he was looking to buy more sims. There are many factors involved, including the level of professionalism you portray as a business owner, for example rude and unprofessional land owners are seeing a decline in business because people rather rent from someone who will treat them well. Get to know your renters and always conduct yourself in a friendly and professional manner. Also Malls may not be doing well because merchants rather rent a parcel where they can deed the land to their group and have control over the parcel and the same goes for people wanting to rent for residential purposes. I never rent land unless I am able to do so by purchasing the land from the about land tab. 

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--------------------------------------------------------------------------------
Loki Eliot wrote:

 

Rodvik has said there are no plans to change the pricing structure so what are possible ways to counter this changed economy?

 


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 We try to recruit new Residents, look outside the box. Self promote.

If the customer doesn't visit you, you visit the customer. Go where people are, any quality conversation will eventually lead to inquires of how you spend your time in SL. 


I have a friend who made some short movies, he has them online and I was definitely impressed with the quality. If he had use of a whole sim, he could make an excellent video presentation to invite new Residents. I believe that people who might see the video would join SL to visit the Place in the video.


The LH development does help to support Residents who may experience economic change.

 

I would have used a Pyramid to show the distribution. There is an apex but it is not the lindens

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Adjustment of the tier prices and setup fees is definitely wanted/needed. 300 dollars a month (ex VAT) is not linear to prices of other products in RL. For 500 Dollar you can buy a quad core PC with a 1GB Gcard. So having 1 sim in SL (on a shared server) is equal to buying a brand new PC every 6 weeks.  Not even mentioning the 1000 dollar setup fee for a sim.

 

 

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I think every one feels  sim fee's are  to high, but what do we base this on , we trust the lindens  to have set cost  to cover costs and to have profit, they are  in this to make money just like any other.

what we have to do is look in side our selfs and ask , do we find value in what we are paying for, we do this every day when we shop on the market place dont we ?  we might search for shoes for example we find some we like, then we decide on witch pair is worth the price . we pay for what we value, so qestion is is sl  value worht the price we all pay ?

Land has allways been a money maker  for basicly the top  witch is the lindens, most people basicly work  weather its creating  objects to sell or some other job in sl to only cover there cost of liveing here ,   the %that make money  past what there cost in sl is to any great extent is small.

lets look at some basic's here most people that have land for homes, what do they want , they want a home large enuff to look bigger then a cabin they want  landscaping car in driveway beach front and to be able to furnish house in a way that, they dont have to take up bed to drop the couch. to really have enuff prims to have any thing  nice and really useable  your almost up to the 75 amonth area, to me a 4096 on down land sizes are a joke  and a waste  and worthless,

i see people in a cycle the buy land  build what they can, as to there dream , then  run out of prims,then hardly spend time at there homes , or  move on to bigger land, basicly spend more money for a few more prims, thats basicly whats its all about, it isnt land size its prims,its all about what we can do with  what we pay for, that decides  the value.

Now the social, value of  sl is great we have people from all over the world, thereis large value to sl  here, and one can be in sl with out owning land here, and i  belive alot  pay what they do  for the social value of sl,and the lindens  wont change land prices if people  are willing to pay ,.

one thing to think about though we do have choices even in land we can have a soical life here in sl , but we can also have land on other grids, so for example avination grid  , yes its new not as advanced as sl but  is basicly sl ,  you can have a sim with no 1000 usd set up fee and only 75 a month fee, now you can build a home have abeach  cars boats guest house have a  full 15,000 prims just for your home, why rent when you can have and own.

 im not pushing avination, i love sl ,and in april  will have been here 8 years, and as a business owner, im also lookng to make money in sl, i have a business center , 2 sims with 36 office  5 meeting rooms and a conference hall,  and  we at times have waitng list for the offices, this may sound good but  basic office  is 2500 a week then you get full use of meeitng rooms, its hard to  get people to see the value to pay what they do for a office, yet basicly  all i do is cover costs basicly of the 2 sims, now one idea is offering for a little more then they pay here i can set them up on a full sim office and center of they selfs on avination, then they have privatcy,(note alot of my clients that rent form me are reallife buiness they want to hold in world meetingns or train staff, and not interested in the rest of sl as to mingle). so here is a example of offering more value for less money and still tie in the social value of sl.

 thing is why can we have both we are free to do what we want  its free to be in sl and cheeper to have land on other grids, till every one stops buying there expensive land at high fee's, they will never change there prices.

why does at&t add new option or lower prices,usally cuse sprint added somehting or chaged prices people move back and forth to best deals.power is in the dollors you spend. 

and as for products  they will go where people buy  the way i hear it there all ready setting up shop there also.

sl will  be the leader for a while im sure   and the mesh objects option coming might change things alot also for sl,

, one thing over the last 8 years here in sl i  find constent is change one has to adapt and move with  it or  sink,

 

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Your premise is based on the idea that people have only commercial interests in buying private estates.  Some, maybe even most, may, but not all.  Some of us find $300/mo an acceptable price for a hobby, and at most use renting land as a way to use up prims we were not using anyway or to help out friends.

Lots of people hopped into the sim-owning business thinking it was an easy ROI.  Guess what?  They were wrong.  They also got into the act late, which meant they got into it when the market was already past the "easy money" phase, as they got into an already over-saturated marketplace.

Also, this idea that Linden homes are driving landlords out of business is laughable.  At best, these are "starter homes" for newbs or "sharecropper" plots for those who would never rent your private estate land anyway.  Also, seems to me this ONLY comes with premium membership and that means, gasp, they would have already had the same exact prim allowance FREE - just have to find a tiny little mainland parcel and then, voila, no rent for their little spot.

I'd love tiers to go down, but that's just my purely selfish wish for lower cost and an ability to afford an extra sim.  LL as a business has made the calculation that the current structure is best for them.  If you want them to change it, you need to show them an alternative that is better for LL, not for you personally.

 

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That is known since they bought it. But everyone told me i am a idiot and have no knowlegde because that will help to increase everything and i am wrong.

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I myself have written to Linden Labs and with no response I still wait till the day they will wake up and smell the coffee.

I told them 2 years ago that the marketplace idea was not a so good idea since it really does take away the need for a store owner to have an INWORLD store and that it would cause a snowball effect in our land markets. I gave them the idea to let the people place a picture of the product and the link that would take the buyer to the inworld store. SINCE SECONDLIFE IS A 3D WORLD correct?
So they should do all to keep the INWORLD economy going!  It only makes sense...Now they even introduced marketplace STORES! so all the stores are now moving out of second life and creating store fronts in the marketplace.

Another idea I gave them was to give insentives for GROWTH! Sort of like a discount scale.

1 to 5 SIMS get 5% discount on the monthly tiers.

5 to 10 SIMS get 10% discount on the monthtly tiers.

10 to 20 sims get 15% discount and so on until it caps.

They told me a big NOOOOOO....!

Now Im building my own GRID and I am going to introduce all my ideas in it and will give insentives and will estimulate our inworld economy!  No marketplace just a good search engine and a forum where the product makers will be able to place the pictures and the links directing people to their inworld stores.!

Second Life is still the largest 3Dworld but its loosing ground and specially now with the open sims now on the markets for this type of hypergrid business.

 

 

 

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Loki Eliot wrote:

In the past Private Island Landlords bought Full sims with the intent to make costs back via rentals of Parcels for private land and shopping space. I have witnessed across many Regions amongst my friends that shop space rentals are in decline as is interest in renting land for homes.

I have a few ideas of why this is.

1) Market Place is taking away the need to have an inworld shop.

2) Linden Homes are out pricing private region land.

This is leaving us with an inability to sustain the Private Island Tier... 

 

Wow, ok, sure.

IF my only residents were small time merchants or 512 renters you would be right Loki.

One thing I have noticed, when someone is selling their sim, someone else is always buying.

The SL land market is still here and it ain't going away any time soon, and neither am I. :)

Lizard Howl

Segarra Estates Owner

 

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Until a few months ago I had very little problem filling my residential rental sims with people.  But, since the beginning of this year, I've struggled to even come close to making tier.    Of my three sims - one is almost empty and I've been trying to decide whether to sell it or turn it into an RP venue.   I've worked with in-world advertising, advertising on Marketplace and even buying a banner on the new mysecondlife homepage. But,  even though I've stuck it out for several years now,  its a losing proposition.

I have a feeling that I'm not alone in my concerns.   I had hoped to just come close to breaking even while the economy was still having trouble, but I suspect I'll be abandoning (or selling for cheap considering what people are paying these days)  a sim or two within the next month.

 

 

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Lizard Howl wrote:

 

One thing I have noticed, when someone is selling their sim, someone else is always buying.

The SL land market is still here and it ain't going away any time soon, and neither am I.
:)

 

 

 

 

 

 

thats because a sim costs 1k usd when bought new.

if linden would scratch that or atleast lower it,why would anyone come to you?

or go to anyone else for that matter?

its the only reason why there is a market

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Rokko Luminos wrote:

 

Lizard Howl wrote:

 

One thing I have noticed, when someone is selling their sim, someone else is always buying.

The SL land market is still here and it ain't going away any time soon, and neither am I.
:)

 

 

 

 

 

 

thats because a sim costs 1k usd when bought new.

if linden would scratch that or atleast lower it,why would anyone come to you?

or go to anyone else for that matter?

its the only reason why there is a market


 

Hi Rokko -

That's an interesting point, but you are missing something.

The Lindens have and allow a wholesale (private transfer) market for sims.

As long as they continue to allow that, there will always be buyers and sellers.

Right now sims on the wholesale market cost 50% less than retail.

A sim with tier paid full for a month can be easily found for $500 USD.

If the Lindens lowered the price for their retail sims, there would likely be a similar adjustment in the price of wholesale sims, but as long as they allow private transfer there will always be a market.

Why pay retail when you don't have to?

Lizard Howl

Segarra Estates Owner

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Loki Eliot wrote:

In the past Private Island Landlords bought Full sims with the intent to make costs back via rentals of Parcels for private land and shopping space. I have witnessed across many Regions amongst my friends that shop space rentals are in decline as is interest in renting land for homes.

I have a few ideas of why this is.

1) Market Place is taking away the need to have an inworld shop.

2) Linden Homes are out pricing private region land.

This is leaving us with an inability to sustain the Private Island Tier. 

Rodvik has said there are no plans to change the pricing structure so what are possible ways to counter this changed economy? 

 

 

 

It has always been hard for private regions, except for a short sprint in 2006-2007. Since then, there has been a glut of land everywhere in SL - Estate and Mainland. There are also natural upturns and downturns throughout the year which have always made it hard. The key to success for any venture in SL is common to the Internet in general - find a way to drive traffic to your location, and when the traffic is there, ensure that your location is interesting enough for visitors to stay, and spread the word to others. Once you have hit the right formula, it will take at least two months until you can reap the financial benefits. If and when LL can find a way to improve the overall concurrency, which has been declining steadily since the advent of Viewer 2.x, one simply has to put up with this overall downturn.

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