An Open Letter to LL from Content Creators

[Lindal Kidd]

No one...well, no one who ever does a Process Credit transaction...likes the doubling of the fee.

But that "open letter" certainly doesn't reflect the opinions of SL creators.  The writer is anonymous, the signers can be anyone...even non-residents.  Moreover, while the author refers to "other ideas for increasing LL's profits", they don't specify any.

Nope, not signing this one.

[Coffee Pancake]

45 minutes ago, Lindal Kidd said:

Moreover, while the author refers to "other ideas for increasing LL's profits", they don't specify any.

That's the bait to get LL to take them seriously! 

[Beth Macbain]

Well, the petition has been read by Ebbe. He made it pretty clear that the creators and merchants should start preparing themselves for more fee increases at some point in the future. 

I don't think the petition worked, you guys...

[Coffee Pancake]

If fees in SL kick up to anything like a 30% tax on creators that Ebbe kept mentioning as a baseline for other digital goods, then it's going to be a very different story, especially as with all the other fees that's going to look more like 50% from from L$ to the bank.

If nothing else it will hollow out the content creator side of SL to only those who who don't make unique content from scratch specifically for SL's real time environment.

We're not there yet, and this is not the correct approach

[Beth Macbain]

1 minute ago, CoffeeDujour said:

If fees in SL kick up to anything like a 30% tax on creators that Ebbe kept mentioning as a baseline for other digital goods, then it's going to be a very different story, especially as with all the other fees that's going to look more like 50% from from L$ to the bank.

He did say he didn't want it to go up to that 20%-30% range but still believes land is too expensive and it has to even out somewhere in the middle. 

He also made it very clear that he and the other Lindens would LOVE to hear ideas from residents for new revenue streams. He is inviting the ideas, but he's not going to do it in a forum where he sits in front of a bunch of content creators and gets yelled at. If these folks truly do have fresh new ideas, I would recommend they create a JIRA or open a ticket or email Ebbe or any other Linden, drop 'em a notecard, create a thread here, something. Tweet to him, tag him on Instagram... there are multiple ways to get an idea to him and LL. 

I certainly have my own ideas and I have been encouraged to share them with LL. That's good enough for me, and I plan to take full advantage of it. Will any of them come to fruition? No idea but I feel pretty good about LL being open to them and running any and all ideas up the internal flag pole. 

That sounded really dirty, didn't it?

[animats]

6 hours ago, CoffeeDujour said:

If fees in SL kick up to anything like a 30% tax on creators

That won't fly. Apple is in trouble in the EU over their attempt to collect 30%. In fact, only little guys pay 30%. Most of the big players have special deals. Spotify has a deal. When Zynga was big on Facebook, they forced Facebook to cut them a deal on payments.

While most vendors in LL accept only Linden Dollars, they could potentially accept other forms of payment. Venmo, Zelle, and Facebook's new Libra coin are possibilities. It's not worth it for little transactions, but some big SL landlords already accept credit cards.

 

[Prokofy Neva]

On 6/26/2019 at 6:39 AM, Theresa Tennyson said:

As it happens, I have made dresses in both real life and in Second Life - not as a retailer, I admit, but I understand the process.

Let's say need to make US$2000 a month by selling dresses. Every dress I make has 2 yards of fabric at $4.00 a yard, and takes 2 hours to sew; I pay my stitchers $21 an hour (we're pretending that I'm not actually contracting it out to someplace that has a sweatshop full of 12-year-olds in a third-world country.) This puts my marginal cost per dress - the cost I need to make one more dress than I had before - at $50.00.

To make $2000, I need to actually make that amount in profit, which means I can either sell 200 at $60 ($10 profit per dress), or 1000 at $51 per dress ($1 profit).

If my cost of fabric per yard goes up to $5 per yard, making my marginal cost $52 per dress, I need to sell 250 dresses at $60 and I can't sell them at $51 or I'll be taking a loss, so my retail price can't go lower than $53.

Now lets say I need to make L$2000 a month from Second Life dress sales and I use templates. I've already paid for my template and textures - my marginal cost per dress is zero. I have a full range of prices I can charge: anywhere from L$2000 apiece, which means I have to sell 1 (to a sucker) to L$1, which means I have to sell 2000. My important factor will be demand - can I find someone to pay L$2000 for a SL dress? Can I consistently find 2000 who want this dress at all?

Now, if I need to make more than L$2000 I can either increase my prices or I can lower my prices and hope that enough more people people are willing to buy my product than they were at the old price. This is much easier to do than in real life because I don't need to price over a marginal cost.

None of this is relevant because in SL, you have the fixed cost of $10 per upload regardless of the quality of the "fabric" but more importantly, there is YOUR TIME. That's really the only cost -- if you pay yourself. If you don't, and SL is a supplement, you can value your time or not. Since you describe your costs as "zero," evidently you don't.

You likely can't sub-contract out the "stitching" work in Photoshop. If you don't have a store or tier to pay, then your costs are quite low. If you do, or you have to pay event fees or clerks to manage customer complaints, then your costs are higher. There would be advertising costs -- how could you compete otherwise? In short, I'm not sure you've calculated the real costs of your business, and your claim that adding $10 easily to cover cash-out costs then isn't believable.

[Theresa Tennyson]

Just now, Prokofy Neva said:

None of this is relevant because in SL, you have the fixed cost of $10 per upload regardless of the quality of the "fabric" but more importantly, there is YOUR TIME. That's really the only cost -- if you pay yourself. If you don't, and SL is a supplement, you can value your time or not. Since you describe your costs as "zero," evidently you don't.

You likely can't sub-contract out the "stitching" work in Photoshop. If you don't have a store or tier to pay, then your costs are quite low. If you do, or you have to pay event fees or clerks to manage customer complaints, then your costs are higher. There would be advertising costs -- how could you compete otherwise? In short, I'm not sure you've calculated the real costs of your business, and your claim that adding $10 easily to cover cash-out costs then isn't believable.

Theresa Tennyson sighs.

I described the marginal cost - the amount you spend to produce the next individual item you're selling, and therefore the minimum amount you need to charge for that item to break even on it - as zero. Because it is.

[Prokofy Neva]

19 hours ago, Lindal Kidd said:

No one...well, no one who ever does a Process Credit transaction...likes the doubling of the fee.

But that "open letter" certainly doesn't reflect the opinions of SL creators.  The writer is anonymous, the signers can be anyone...even non-residents.  Moreover, while the author refers to "other ideas for increasing LL's profits", they don't specify any.

Nope, not signing this one.

Why on earth does it matter if the drafter of the petition is anonymous??? Like you, with your name "Lindal Kidd" not linked to a RL name on your profile, are anonymous.

Many people signed the petition with real names -- I sure did. Change.org encourages that. Some signed with avatar names. As I see them go by, I recognize some of them. So this isn't a campaign with 3,000 anonymous people.

And people who aren't in Second Life wouldn't understand or bother with this. 

There are all kinds of ideas one can provide for increasing LL's profits but that's not the essence of the letter, which is to convey a protest about the doubling of the fee -- which has attracted SIGNIFICANT support.

I'm trying to see here the real version for the animosity to this petition. I suppose it's jealousy of a social class of people in SL who make a living or at least enough to cash out and have it matter. I'm *not* one of those people myself. But even so, it's truly annoying that not only has the cash-out doubled, the Linden's value has crashed along with it by two points now. So that adds up. The Lindens could have staggered these changes. They could have allowed the lower prices for tier on the island to take effect and provide some relief...the premium account increases to undo that...then doubled the cashout. Instead, they've put in all three, ensuring the lower prices for the islands is essentially cancelled out.

What else could this be about? Feverish loyalty to the Lindens, which is pandemic among the forums' regs. 

Even so, I think there is something else driving this. And maybe some people have been put up to their angry posts about this.

 

[Fox Wijaya]

9 minutes ago, Prokofy Neva said:

 not only has the cash-out doubled, the Linden's value has crashed along with it by two points now. So that adds up.

 

i hope you realize... that "crash"" ... dramatic for 2 points only..... is made by the same persons who háve something to cash out .. it's panicking for nothing by them.
 

 

12 minutes ago, Prokofy Neva said:

 I suppose it's jealousy of a social class of people in SL

when we look at all posts these days it's raining classes everywhere, the one more important than the other, and even many even more important than the highest already taken status... this is simply a absurd view on the community of residents in SL

[AyelaNewLife]

It still tickles me that people are so mad about a processing fee increase roughly equivalent to annual inflation.

[Qie Niangao]

21 minutes ago, Fox Wijaya said:

i hope you realize... that "crash"" ... dramatic for 2 points only..... is made by the same persons who háve something to cash out .. it's panicking for nothing by them.

Maybe. I mean, the LindeX exchange rate is tightly controlled by the Lab either directly (in the form of new L$ sales if the supply is driving up the value) or indirectly by manipulating sources and sinks. Usually the sinks vastly outweigh the sources so those Supply Linden sell orders execute often. So what's happening now?

Perhaps the Lab has decided to raise the target exchange rate slightly, decreasing the value of the L$ by putting in sell orders at a price more generous to buyers. That seems most likely to me, especially if the rates don't soon return to the previous range. It might even be a smart Keynesian move to goose the SL economy with a little "quantitative easing" just as the change in fees takes effect.

Or, yeah, maybe there's a little burst of private sales generating supply at these new rates. If so, though, it will reverse soon; there just aren't enough L$s in circulation to feed the sinks for long.

I guess it's theoretically possible that sinks are (momentarily?) less effective, which could happen for example if there were a Marketplace outage stopping payment of commissions, or some bug preventing upload of mesh models, textures, etc., with their corresponding L$-denominated fees. Possible, yeah, but seems unrelated to current conditions.

If there's a shift in Land rentals from L$ to US$ payments, I guess it might temporarily reduce demand for the L$ -- no need for tenants to buy L$s to pay rent now payable in US$ -- until the sinks correct for the excess supply. As I've said elsewhere, though, I don't see landlords pushing to shift all that many payments away from L$s; they'd only benefit to the extent they have profits exceeding any current US$-denominated rent income.

The other side of the supply equation, L$ sources, could increase if there's a burst of new Premium members, increasing total stipends paid out. Maybe folks hurried to subscribe their formerly Basic alts before the new Premium fees kick in and have now collected their first week or so of stipends, increasing supply and thus replacing a small share of LindeX purchases. I dunno, sounds a little far-fetched to me, but the timing is about right.

[Blush Bravin]

Economics hurts my head so while I have a basic understanding I'm not one to really understand market fluctuations. But I'm wondering if the fact that I cashed out twice as much as I normally do this month, so that I could take advantage of the pay ahead offer, might be part of the cause. I'm thinking there were many who did the same this month.

[Qie Niangao]

2 minutes ago, Blush Bravin said:

Economics hurts my head so while I have a basic understanding I'm not one to really understand market fluctuations. But I'm wondering if the fact that I cashed out twice as much as I normally do this month, so that I could take advantage of the pay ahead offer, might be part of the cause. I'm thinking there were many who did the same this month.

I can understand converting L$ to US$ to pay that fee -- and yeah, if enough people sell L$s into the LindeX like that it could depress the value. So yeah, that does seem a likely contributor.  But I'm curious: did you actually "cash out" the US$ proceeds of those L$ sales? (The pay ahead fees can come directly from the account's US$ balance, right?)

[Theresa Tennyson]

10 minutes ago, Blush Bravin said:

Economics hurts my head so while I have a basic understanding I'm not one to really understand market fluctuations. But I'm wondering if the fact that I cashed out twice as much as I normally do this month, so that I could take advantage of the pay ahead offer, might be part of the cause. I'm thinking there were many who did the same this month.

That's exactly what's happening and the same thing happened the last time Linden Lab increased the fee for cash-outs a couple of years ago. There's a limit to the amount Linden Lab will buy or sell into the market and with a change like this you'll see a slight change in value for a time.

[Blush Bravin]

1 minute ago, Qie Niangao said:

I can understand converting L$ to US$ to pay that fee -- and yeah, if enough people sell L$s into the LindeX like that it could depress the value. So yeah, that does seem a likely contributor.  But I'm curious: did you actually "cash out" the US$ proceeds of those L$ sales? (The pay ahead fees can come directly from the account's US$ balance, right?)

It's a two step process. You cash out, Lindens to US$, and then you can request a process credit, a portion or all of your US$ sent to RL. So, I cashed out and the fees were deducted from my US$ balance. Does that answer your question?

[Selene Gregoire]

2 hours ago, Prokofy Neva said:

Feverish loyalty to the Lindens, which is pandemic among the forums' regs. 

Hogwash.

[Qie Niangao]

1 hour ago, Blush Bravin said:

It's a two step process. You cash out, Lindens to US$, and then you can request a process credit, a portion or all of your US$ sent to RL. So, I cashed out and the fees were deducted from my US$ balance. Does that answer your question?

Oh, interesting. I'd always understood "cash out" to include the process credit portion, not only the currency exchange part. Thanks.

[Lindal Kidd]

3 hours ago, Prokofy Neva said:

Why on earth does it matter if the drafter of the petition is anonymous??? Like you, with your name "Lindal Kidd" not linked to a RL name on your profile, are anonymous.

It matters because we'd like to know who (in SL resident terms) is behind this.

3 hours ago, Prokofy Neva said:

What else could this be about? Feverish loyalty to the Lindens, which is pandemic among the forums' regs.

I am certainly not "feverishly loyal" to the Lindens.  Back when they banned gambling, I spoke up against it.  When they created the Adult rating and exiled all the Adult content to Zindra, I screamed bloody murder (and I wasn't even a part of the Adult content or services community.)  I'm simply trying to see both sides of this issue, and I don't think the person behind the "open letter" has much of a leg to stand on.

3 hours ago, Prokofy Neva said:

Even so, I think there is something else driving this. And maybe some people have been put up to their angry posts about this.

Wow.  Paranoid much?

Just to be clear about my personal situation.  I have never done a Process Credit transaction.  On the other hand, my modest income in SL has made it possible for me to not have had to buy $L with outside cash for a long time now.  If and when I sold my land, THEN I would do a Process Credit.  In fact, I'd have to do two or three of them, given the current transaction limits.  That prospect annoys me, and the fees (and their increase) annoys me more.  But I realize LL has to make money out of SL, or the world goes away.

[Coffee Pancake]

4 hours ago, Prokofy Neva said:

Even so, I think there is something else driving this. And maybe some people have been put up to their angry posts about this.

Sorry, can't tell you anything. First rule of fight forum club and all that ... 

34 minutes ago, Lindal Kidd said:

I am certainly not "feverishly loyal" to the Lindens.  Back when they banned gambling, I spoke up against it.  When they created the Adult rating and exiled all the Adult content to Zindra, I screamed bloody murder (and I wasn't even a part of the Adult content or services community.)  I'm simply trying to see both sides of this issue, and I don't think the person behind the "open letter" has much of a leg to stand on.

Feverishly loyal to Second Life ... and I agree, the gambling ban (and subsequent skill gaming) was an unmitigated disaster, and Zindra should never have happened. 

Gaming in SL wasn't about playing slot machines, it was never about slot machines. It was a social group activity with joint game and a shared pot. What do we have .. a few regions will 3000 copies of a single player slingo clone. Good job.

Zindra was decisive and split the community and is now an abandoned wasteland that's all owned by that one land barron, regular mainland never recovered.

Edited June 27, 2019 by CoffeeDujour

[Prokofy Neva]

7 hours ago, Lindal Kidd said:

It matters because we'd like to know who (in SL resident terms) is behind this.

I am certainly not "feverishly loyal" to the Lindens.  Back when they banned gambling, I spoke up against it.  When they created the Adult rating and exiled all the Adult content to Zindra, I screamed bloody murder (and I wasn't even a part of the Adult content or services community.)  I'm simply trying to see both sides of this issue, and I don't think the person behind the "open letter" has much of a leg to stand on.

Wow.  Paranoid much?

Just to be clear about my personal situation.  I have never done a Process Credit transaction.  On the other hand, my modest income in SL has made it possible for me to not have had to buy $L with outside cash for a long time now.  If and when I sold my land, THEN I would do a Process Credit.  In fact, I'd have to do two or three of them, given the current transaction limits.  That prospect annoys me, and the fees (and their increase) annoys me more.  But I realize LL has to make money out of SL, or the world goes away.

"Who is behind this"? It's not a crime, Lindal. It's more than fine. More than 3,000 people have signed with their names, and that's what counts. 

If the person "behind" this petition -- and again, it's not a crime, even in Second Life -- didn't have any support with this idea, they'd have 50 or 100, or 1, like some of mine. But they have 3,000. It's not about that person.

Slavish loyalty to the Lindens isn't exhibited necessarily by aligning with their every move, especially on something like Zindra. As for gambling, sorry, but that's the law of the USA; the Lindens complied with this, where they were slow on other things (like *****) because the major credit card companies like Master Card simply informed them that if they violated US law on Internet gambling, they would no longer process their transactions. Because real-life companies grasp that they have to abide by the law if they want to keep having customers. So LL reluctantly complied.

And that counts more than virtual reality. And I personally think it's a good thing, as there are too many gambling addicts, too many lost fortunes, and too may vultures preying on poor people, so we shouldn't add to that.

No, slavish loyalty is indicated in a phrase like "I realize LL has to make money out of SL, or the world goes away."

Huh? What are WE, if not the world!!!

We are the world.

We make money for the Lindens.

We show up and pay for premium accounts, server rentals, fees on every Marketplace purchase, Linden conversion fees and cash-out fees. We already sustain Linden Lab wonderfully. Server rentals produce way more revenue for them than cash-out fees, even doubled. They only reason they are grabbing at this now is ideological -- they bear the historic socialist/communist aversion to land as a basis of a society's economy, because then they can't control the world as much -- not only do people do what they want to on their land -- they make money from that land that the Lindens can't see any part of, unless they grab at transaction fees and cash-out fees. Understood, but need they grab so much? People are canceling premium accounts -- after first buying them when they added 512 more "free" tier. So they are undoing that good.

There are indeed other ways for Lindens to make revenue.

o Content sales -- eventually they will come to this. They already compete with house builders and land renters so they will eventually invade this space. And why not? They know the platform the best and can build to it the most skillfully. For years, Linden and Mole content was superior to residents' content. This changed with the advent of mesh, when Moles didn't make mesh things. But eventually this strange imbalance will revert and they will sell content.

o More granulated tier increments -- any time the Lindens are ready to stop grabbing at 8192 from the poor 4096 owner who wants to go beyond 4096 plus 1024 a bit for prims, they will get more purchases of tier.

o The Lindens could temporarily rent tier in 512 blocks by having a Tier Linden who joined your group and gave you tier as long as you paid him X in Lindens.

o Welcome area ad boards to teleport to venues of interest, and highway billboards. In a world where the Lindens refuse to meet the pent-up demand for advertising that would help their business AND our businesses, I can't take seriously their "need" to double the cashout fee on our backs.

o Special events -- every single Silicon Valley business makes their cash in events where big wheels pay to speak on panels, and where techs and others interested pay steep admission fees to rub elbows with big wheels at "fireside chats". Even if all the Lindens did was another SL meet-up for residents, as they did about 5 times in the past, they could make cash if they put their minds to it -- after all, they do the birthday now, whereas in the past they left it to residents. The only reason they stopped was because they ran into all kinds of scandals on the one in Chicago, remember? I can enumerate if you forget. 

o Special admissions passes -- the feature on the land menu to pay tickets to get admitted to land has almost never been used by most people. That's because they don't have anything compelling enough to get people to pay. But the Lindens do. They can create events that are recurring like games or live music or whatever. They themselves are a scarce quantity people would pay to see/listen to.

Never, like Elizabeth Warren, say the socialist idiocy, "You didn't build that" about Second Life. The Lindens created Second Life by accident, as a second thought after their first thought of making virtual world goggles and haptic gloves, which were their real interest at first (they were just too early with this). Their first iteration of the world was something they not only blew up -- they did nothing to stop crashing by griefers for years because they found it a useful load test.

So, in real life, first came businesses in RL, then came taxes, then came government services like roads. People and commerce "built that," not governments, which are secondary if necessary. When socialists try to do this in reverse, it doesn't work. The residents really did build Second Life. As it happens, they have made the best clothing, skins and hair (only former residents-turned-Lindens have done that, not Lindens per se); they have built the best live music; they have built the best home & garden decor and so on.

The Lindens are poised to grab an even bigger chunk of the housing and rentals market than they already have, banking on the fear especially of newbies -- stoked by forums' regulars -- of being ripped off by unscrupulous landlords who either disappear, or don't refund, or perform badly. The only problem with the Khrushyoby Linden-style now is the same as what Khrushchev found in real life -- he can't get the state-controlled building and housing ministries to function fast enough to satisfy all customers.

 

Edited June 27, 2019 by Prokofy Neva

[ThorinII]

So much text and yet so much nonsense... 🙄

[KanryDrago]

10 hours ago, Prokofy Neva said:

"Who is behind this"? It's not a crime, Lindal. It's more than fine. More than 3,000 people have signed with their names, and that's what counts. 

If the person "behind" this petition -- and again, it's not a crime, even in Second Life -- didn't have any support with this idea, they'd have 50 or 100, or 1, like some of mine. But they have 3,000. It's not about that person.

 

3000 out of a population of hundreds of thousands, its sort of a minor drop in the ocean

[AyelaNewLife]

Infowars called, they want their scriptwriter back

[Qie Niangao]

12 hours ago, Prokofy Neva said:

There are indeed other ways for Lindens to make revenue.

o Content sales -- eventually they will come to this. They already compete with house builders and land renters so they will eventually invade this space. And why not? They know the platform the best and can build to it the most skillfully. For years, Linden and Mole content was superior to residents' content. This changed with the advent of mesh, when Moles didn't make mesh things. But eventually this strange imbalance will revert and they will sell content.

...

Hoo boy!  We got a petition-full of creators already squealing like stuck pigs over a paltry nickel-and-dime fee increase. Can you even imagine the hue and cry over this?! Even I would sign a petition against it.

Edited June 28, 2019 by Qie Niangao