Infrastructure Investment Update: Buy/Sell Fee Change and Land Pricing Effective Mar 6, 2023 DISCUSSION

[Randall Ahren]

3 hours ago, Rolig Loon said:

The bottom line is that we have almost no idea what Linden Lab's business model looks like,

We have an idea of what the business model looks like. It's basically the slum-lord model. Squeeze as much as possible out of the tenants of a decrepit, run down building, before the building is condemned. The SL owners are not going to invest capital on an outdated platform with a declining and rapidly aging userbase.

[bigmoe Whitfield]

2 minutes ago, Randall Ahren said:

We have an idea of what the business model looks like. It's basically the slum-lord model. Squeeze as much as possible out of the tenants of a decrepit, run down building, before the building is condemned. The SL owners are not going to invest capital on an outdated platform with a declining and rapidly aging userbase.

they to be actually investing it or it would of already stopped getting updates and new features. 

[Chic Aeon]

18 minutes ago, Randall Ahren said:

We have an idea of what the business model looks like. It's basically the slum-lord model. Squeeze as much as possible out of the tenants of a decrepit, run down building, before the building is condemned. The SL owners are not going to invest capital on an outdated platform with a declining and rapidly aging userbase.

That "story" is so VERY OLD and has never come to fruition for the believers :D. 

 

As long as SL is making money for the investors it is "safe" to continue. So in quite a few ways we should likely be happy that they are actively working on ways to profit -- other than selling or closing.   I would rather make less profit than have the grid disappear and I suspect that would be the majority of folks' position.

 

UNLESS you have access to The Lab's balance sheets -- you are just making assumptions.   

[EliseAnne85]

3 hours ago, Rowan Amore said:

LL IS  paying those to the appropriate tax agency as they have said.  Eventually, they will be charging us and I expect there will be another outcry from.the masses.  

Sales tax?   You know, thinking about it doesn't seem fair to charge sales tax on digital items.  It might make sense if the items were modify/transfer, no copy because that's how items exist in the real world, plus one can resell or trade the real life item good.   Even NFT's one can resell.  

But, anyhow this is off topic anyways.  Yet still, taxes on something we cannot resell.  That wouldn't go over well with me.

Edited March 10, 2023 by EliseAnne85

[Coffee Pancake]

39 minutes ago, Chic Aeon said:

UNLESS you have access to The Lab's balance sheets -- you are just making assumptions.   

The website we're not allowed to talk about has been very enlightening when it comes to LL's income 

[Drayke Newall]

7 hours ago, Rowan Amore said:

https://modemworld.me/2021/02/26/lab-gab-feb-26-summary-aws-update-and-a-farewell-to-oz/

WILL THE MIGRATION MEAN LOWER PRICES FOR USERS?

[5:46-9:02]

Sort answer for the foreseeable future: no.

There has been an idea circulating among users that running SL on AWS is “dramatically cheaper” for Linden Lab; but this is actually not accurate.

The problem with quoting OZ is that he doesn't quite tell the whole story - yet people believe him not matter what. No where did Ebbe or Oz state that simply moving to AWS will reduce their cost. No where do users also say that moving to AWS 'as is' should be 'dramatically cheaper'. He uses half truths as a response to those users saying it should be 'dramatically cheaper'.

Go look back at the very first announcement that Ebbe and Oz did for the AWS move. Here they quite clearly and comprehensively had a laid out the plan that they intended to use to make AWS cheaper, SL more profitable (to allow dramatic lowering of land fees) and to make SL more marketable. It was the following:

1. Move SL to AWS so as to save on upgrade costs, rent, building maintenance, electricity cost etc. This is what Oz touches on in your quote and where Oz leaves it not mentioning the rest of the plan giving a false narrative.
2. Use AWS to offer SL users an on demand system. I.E. if a sim isn't in use for a certain period of time the server gets spooled down and reduces the load on AWS servers and when a user tps to that server the sim spools up and comes online again (therefore costing less in fees LL need to pay Amazon). This method was to be done as an offering where a land owner could either pay less for such a sim (with small inconvenience of waiting for the server to load when you tp there) or pay more for a dedicated sim that is always on. This is how Kitely manage there servers (also hosted on AWS just like SL) and they can offer sims for as little as $15/month for an 'on demand server' or a dedicated sim price of $149.95 to be always active (i.e. similar price to SL and still having multiple sims hosted on the server, except providing FAR more prim allowance than SL).
3. Make SL assets hosted on additional and more local AWS servers therefore reducing ping (and increasing usability) for those not in the USA.

For reference below are the direct quotes from Ebbe regarding their plan for AWS and for each step. Ebbe being the then (and last) CEO provided the how on cost saving as well as improvement in stability as that is what a CEO does, looks at the whole picture not just the technical side. Also keep in mind, this would have all been discussed in the board room and details finalised prior to the announcement so what is quoted below can be taken as all being possible from a technical standpoint as Oz would have certainly interjected if it was not.

Step 1 (saving capital cost):

Quote

"It turns it into less capital expenditure to have to buy all the equipment and doing all the maintenance on that. You kind-of pay for what you use; with Second Life [right now], once we’ve bought a piece of hardware, we have to sit on it whether it’s being utilised or not, whereas you can kind-of dynamically scale your consumption as necessary when you use something like AWS … which we believe will reduce costs for use and then ultimately, we hope to pass that on to customers." 5th March, 2018

Step 2 (saving running cost and passing savings to users through reduced tier):

Quote

"Some experiences might want to have continuous persistence over time, and maybe that’s one type of pricing model, for an always on type of scenario. Maybe other will be fine with, hey, I’m only using this for a few hours in a class a few times a week or something. and if that can spin-up in a few seconds, and then I just need to basically pay for the time that I’m utilising it." 15th March, 2018

Step 3 (reduction in latency for improved experience for non-usa):

Quote

"Today we are located in the US, which means that people from Australia or Asia or Europe have to travel quite a ways, which is hundreds of extra milliseconds of latency. So if you want to have a very dedicated community in Australia or somewhere, we could maybe start to distribute our server infrastructure to be closer to where the actual customers of those regions are, which would make things more performant." 15th March, 2018

Out of all of that plan and potential options set out to lower cost of Second Life for both LL and the user they have done only one thing - Step 1. Last I heard regarding that plan and just before Oz left was that all of that plan was now on hold and likely to be stopped due to the new owners.

So it is not quite as simple as move to AWS and everything is cheaper and better. No one said that EVER. It is far more comprehensive and they had a long term plan to see that reduction of which, has now by the looks, been abandoned by new management.

Edited March 10, 2023 by Drayke Newall

[Cam Mode]

9 hours ago, Pixels Sideways said:

So LL hired some marketing guy they're prolly forking over a lot $$$ to and yet I see nothing anywhere about SL in the press, on social media, etc., other than things written by residents.

Truly LL has repeatedly failed in this regard and it's no surprise that retention doesn't pan out and attrition increases. And this affects their bottom line.

As someone pointed out earlier, SL needs more cash cows (residents) and I have yet to see effort on LL's part to successfully drive that.

 

 

I have to think it is ageist or size-ist or handicap-ist ---- why not advertise where us couch potatoes are plopped?  I wonder if it isn't the bias of Lab employees who want a "modern fresh forward looking"resume --  are  they avoiding snickers -- "oh you work where the old **r*s fly and wear mini-skirts and dance to Best of the 80's--haha "?

The general population is aging, more money is with the older folks than the college loan burdened , no house down payment, lives with Mom and her partner  and never a hope for a pension yielding  career younger client yet  they are chased.

If I did marketing for the Lab I'd be offering RL College Reunion programs  -- attendance at Reunions drops like crazy with age --yet the older folks more likely to drop a RL bundle on the school for  naming a bench or whatever---   be so easy to have dedicated regions that could be spun up -- for listen in reunion classes that are happening on RL campus  , have a SL dance , library settings to talk etc.   Then the attendees could be offered a rest of  grid ready to go avatar with a new name they choose - if they wanted to leave the region and explore the rest of SL. 

Colleges happy- more face time with alumni, alumni happy they are included and avoided travel and its costs  and SL has a fresh crop of potential residents with a built in friend list.  And moneyyyyyy....

And you know the Moles could whip up mini-Stanford or Yale -ish campuses that could be stored away .

Anyway , hope they bring in new folks because the average age where I hang is around 4000 days and a "kid" is 1000 ---

 

 

 

[belindacarson]

8 hours ago, Tech Robonaught said:

LL is NOT - a non profit business.

I don't know what their overhead is, but based on the difficulty getting a human on the phone at their office and the fact their office hasn't moved in 2 decades, I'm going to have to say other than the AWS portion, not much compared to the 3+ million a month they collect in Land fees.

Actually their office has moved.  Check the address on LL website it's not shown as battery street now, it looks like a mailing address and a small office when you see it on Google maps.  Bulk of their workforce are remote workers now since lockdown.

In fact the jobs they advertise pretty much all say remote workers.  So probably saving a ton on rent "if" battery street is going/gone.

 

Edited March 10, 2023 by belindacarson
added words

[bigmoe Whitfield]

10 hours ago, belindacarson said:

Actually their office has moved.  Check the address on LL website it's not shown as battery street now, it looks like a mailing address and a small office when you see it on Google maps.  Bulk of their workforce are remote workers now since lockdown.

In fact the jobs they advertise pretty much all say remote workers.  So probably saving a ton on rent "if" battery street is going/gone.

 

https://www.google.com/maps/place/548+Market+St,+San+Francisco,+CA+94104/@37.789827,-122.4006743,3a,75y,234.63h,95.93t/data=!3m6!1e1!3m4!1sgzpQH8tDXrRkPIJkzzxYJg!2e0!7i16384!8i8192!4m17!1m8!3m7!1s0x808580627b5ea1d1:0x60fd99496057cf74!2s548+Market+St,+San+Francisco,+CA+94104!3b1!8m2!3d37.7898397!4d-122.4012864!16s%2Fg%2F11csjjwk_g!3m7!1s0x808580627b5ea1d1:0x60fd99496057cf74!8m2!3d37.7898397!4d-122.4012864!14m1!1BCgIgARICCAI!16s%2Fg%2F11csjjwk_g

 

that took me a bit, kept dumping me on stevenson st...  but no idea where it would actually be located.   seems odd they didnt tell us they moved off battery.

[Scott Coleman]

On 3/7/2023 at 7:13 AM, steeljane42 said:

The price cut before the previous one (and the last I already didn't care to check) had all big and known estates decrease their prices. Land impact upgrade in 2016 also wasn't any different, I remember keeping the same parcel with the same tier, but getting more li (it was when when they've upgraded private regions from 15 to 20k and homesteads from 3.75k to 5k).

I suppose in the following days, perhaps weeks, we'll see if the same big estates decided to lower the fees again, or to keep it for themselves this time around. If even one really big land lord will do this, then others will probably be forced to follow or their prices won't be competitive.

The interesting thing that people are missing is the really big land barons pay much less than 209 a month, so this doesn't really do anything to help "evil land barons" 

[Scott Coleman]

On 3/7/2023 at 11:03 AM, Coffee Pancake said:

It's great if you're in the land business as this deletes the single biggest line item from the balance sheet and massively simplifies accounting and tax. Assets aren't assets if you can pay for them with in game tokens. This will have huge knock on ramifications for the L$ economy and how LL operate L$ supply and its value.

That would be why this has a 6 month beta period, not because they are working out the 'technical bugs'. This is open heart surgery with a spoon and anything can happen.

My money is on this pressuring LL to accelerate the L$'s gradual devaluation and lead to a further increase in Tilia's fees as they look to replace lost volume.

Tier fees are an expense that can be claimed on taxes, so paying more in world to reduce what a land owner can claim in expenses makes no sense, and paying more for it because it's in game money makes even less sense.
Now they pay double fees from what they were to cash out so they can pay their tier is even more of an expense to claim.
And since "Land barons" typically pay much less than 209 a month, unless they are a relatively new company, that's really an underdog paying full tier, the $20 a month (Thats not really an extra $20 a month due to the increase of cash out fees) the decrease in tier doesn't help them at all. 
Even if the Land Barons don't do a drastic price drop, unless it's a really huge company, a piddly 14 bucks a month or so reduction in tier (after the fee increase) isn't exactly going to do much other than possibly cover their living increases in rl.

Edited March 10, 2023 by Scott Coleman

[Rowan Amore]

1 hour ago, Scott Coleman said:

The interesting thing that people are missing is the really big land barons pay much less than 209 a month, so this doesn't really do anything to help "evil land barons" 

How much do they pay?

[bigmoe Whitfield]

3 minutes ago, Rowan Amore said:

How much do they pay?

I want to know this one too,  as even after 15 years, I've never seen any real pricing, it's always been "well so and so told me" or they have gotten information from their "linden friends"

[Sid Nagy]

Given the percentage of not rented out land on many regions and calculating with what prices they charge for their plots, the profit margin for them is very very thin or they even operate at a loss, when they have to pay the same amounts as we have to for a region.

How much they exactly pay is of course a business secret between LL and each baron and possibly different for each individual baron that holds enough land to get a better more professional deal.

Edited March 10, 2023 by Sid Nagy

[MoiraKathleen]

I didn't see the region monthly decrease as something for the land barons, but more as something for the non-land barons who would like to own their own full region.  There has been criticism of land costs being too high, for quite some time.  The $20 decrease isn't a lot, but it is something, especially in the light of it being on top of earlier decreases for region costs.  

[Randall Ahren]

On 3/9/2023 at 6:00 PM, Chic Aeon said:

UNLESS you have access to The Lab's balance sheets -- you are just making assumptions. 

It's a conclusion based on observations from lack of growth, fees that get screwed higher every year, and the Labs demonstrated lack of interest in SL, which is why we got Sansar and Blox instead of investment in SL.

SL is a no growth business well past its use-by date. Most creators are going to start treating SL just like the Lab does. Collect the few coins that come in, but not bother with any serious development efforts because it's not worth investing in.

When was the last time the Lab actually came up with something innovative? 

[Alwin Alcott]

12 hours ago, Scott Coleman said:

The interesting thing that people are missing is the really big land barons pay much less than 209 a month, so this doesn't really do anything to help "evil land barons" 

One of the things i remember have read ( in my first years ) in the time this  Atlas Program was still public(?) ... people need 1000+ regions .. so thats really not for the little boys and girls.

[Phil Deakins]

14 hours ago, Rowan Amore said:

How much do they pay?

I've never seen any figures but quantity discounts are standard in business, so I'd guess that it depends on the number of sims, and perhaps also on individual negotiations. I've always said that anyone can get quantity discounts on sims. All they need to do is buy enough of them. Maybe there's a minimum number before LL will offer a discount. 5? It's not many. But I reckon 10 would attract a discount.

[Very Vanilla]

Man, as a creator this change is painful. It goes up, slowly, forever and forever, but increasing prices on products doesn't seem feasible because customers get shafted too.

The 10% Marketplace cut (I Dunno about most people, but 94% of my sales are Marketplace). 5% to sell the lindens. Another 5% to withdraw. That's an entire 18.78% taken out before it reaches the creator.

People used to say to creators that "you should be happy LL only takes X percent, just look at other places, they take like 20-30%!" Well LL's reached that point too.

[Crim Mip]

On 3/6/2023 at 11:20 PM, Coffee Pancake said:

How many "sims" you got ?

Why does it matter if I have any or not. My statement stands. Those screaming over the small increase are mostly acting like entitled Karens only there's no manager who will come listen to to them.

[Love Zhaoying]

58 minutes ago, Crim Mip said:

Why does it matter if I have any or not. My statement stands. Those screaming over the small increase are mostly acting like entitled Karens only there's no manager who will come listen to to them.

^^^ This. Everything in RL gets more expensive every year. In SL, the land gets less expensive over the last few years, but fees go up like everything else in RL and people lose their minds over the game expenses. 

[Arielle Popstar]

5 hours ago, Crim Mip said:

Why does it matter if I have any or not. My statement stands. Those screaming over the small increase are mostly acting like entitled Karens only there's no manager who will come listen to to them.

 

4 hours ago, Love Zhaoying said:

^^^ This. Everything in RL gets more expensive every year. In SL, the land gets less expensive over the last few years, but fees go up like everything else in RL and people lose their minds over the game expenses. 

Because it is  not that small of an increase and is the second one in less than 2 years. A doubling in fact of the fee since April 2021 and a 10 fold increase in the flat fee rate which overall is a significant increase for many purchasing L$. That I think is probably the most significant increase of any industry and makes me wonder how much trouble Secondlife is in that they have to resort to it.

[Alwin Alcott]

4 hours ago, Arielle Popstar said:

 

Because it is  not that small of an increase and is the second one in less than 2 years. A doubling in fact of the fee since April 2021 and a 10 fold increase in the flat fee rate which overall is a significant increase for many purchasing L$. That I think is probably the most significant increase of any industry and makes me wonder how much trouble Secondlife is in that they have to resort to it.

oh please ... if you really want SL is totally free to play. Every expense is a choice.

[Elvina Ewing]

3 minutes ago, Alwin Alcott said:

oh please ... if you really want SL is totally free to play. Every expense is a choice.

the question is: how many people will have made this choice after this... And imagine that everyone suddenly decided they will now play SL for free without any cost to them, how happy will LL themselves be with that choice...

[Alwin Alcott]

1 minute ago, Elvina Ewing said:

 how happy will LL themselves be with that choice...

i bet it will be changed back soon if they see a giant drop in paying customers