Doomed Secondlife

[Randall Ahren]

Maya is just pointing out that price and demand are inversely related and that virtual goods are highly scalable. Once something is made, it can be copied an infinite numbers of times with no further cost input required. If you've put something up for sale that once sold well at that price, but sales have dropped off, trying lowering the price. It is better to have more sales at a lower price than no sales at a higher price.

 

[scripts1488303089]

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Randall Ahren wrote:

Maya is just pointing out that price and demand are inversely related and that virtual goods are highly scalable. Once something is made, it can be copied an infinite numbers of times with no further cost input required. If you've put something up for sale that once sold well at that price, but sales have dropped off, trying lowering the price. It is better to have more sales at a lower price than no sales at a higher price.

 

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Ok.  Then, are you free tonight? :matte-motes-bored:

[Phil Deakins]

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Randall Ahren wrote:

Maya is just pointing out that price and demand are inversely related and that virtual goods are highly scalable. Once something is made, it can be copied an infinite numbers of times with no further cost input required. If you've put something up for sale that once sold well at that price, but sales have dropped off, trying lowering the price.

It is better to have more sales at a lower price than no sales at a higher price.

 

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Exactly! When I started my furniture store, I set my prices low. People told me that my prices were too low, but I always said, "I'd rather sell 11 at 100L than 1 at 1000L". That was exactly what I told them - word for word. It only took a few months before I taking between US$4000 and US$5000 a month out of SL.

[Carole Franizzi]

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Pussycat Catnap wrote:

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Carole Franizzi wrote:

My suggestion would be to open your mind to the teeny-weeny possiblity that one day SL might just close. That way, IF it happens, it won't be such a shock to you.

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Eventually I presume. But it just isn't happening yet.

In fact even land ownership, despite Marketplace, has remained constant.

I decry Marketplace's negative impact on inworld activity all the time, but gridsurvey appears to suggest I'm wrong.

 

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I had a peek at their grid survey too,  re population trends - and there seems to be a steady downward trend.

[Carole Franizzi]

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Randall Ahren wrote:

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Ceka Cianci wrote:

i don't understand that part? post at SLU?

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I don't think it's a good idea for Lindens to be posting as Lindens at unofficial forums. This is the official SL forum here and they should post here to build traffic and get more people to sign up to be residents, not at SLU. I understand why they post at SLU, less spam for one and more traffic according to this 

thread

 where a Linden had been posting about the trending tab at SLU.

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Ha! They won't answer questions from residents on their own official forums, but answer them on external ones? Oh, that's funny...

[Carole Franizzi]

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Phil Deakins wrote:

Yes, there's US$1 charge for transfering US$ to PayPal, regardless of the amount so that's irrelevant, and a charge for selling L$ for US$, so LL does get some money from that. They also get some the other way - when people buy L$. And they get a cut of MP sales too.

LL gets money from a number of sources, but I'm pretty sure that by far the biggest source is tier. If tier was their only income, SL wouldn't need to close, but, if they lost the tier, I've no doubt that they'd have to close SL. As I see it, tier is their staple diet and the other things are just bits of jam on it.

Look at it this way. If there were no landowners, LL wouldn't have an income from the land and they'd have a decimated income from other sources:- nobody would buy anything for their land because they don't have any - no houses and buildings, no furniture, no plants of any kind, no club gear, no breedables, etc. etc. - and there wouldn't be much in the way of exchange commissions because people wouldn't need L$, except for clothes, anims (but where would they use them), and such. As long as there are enough landowners to pay enough tier, which would make it so that L$ are worth buying, etc., LL can keep SL going. But the fewer landowners there are, the less income LL gets from all sources, especially tier. If the slow decline continues, there will eventually come a time when there aren't enough landowners paying tier for LL to keep SL going.

And that brings me back to my point, that it's concurrency that matters and not creators. If concurrency (people using SL) continues to decline, there will be fewer and fewer landowners paying tier, which will mean that SL will end. It shouldn't happen in the near term, but the decline is continuing.

 

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Yep. I always imagined that income generated on LL purchase and on uploading and on other things like Marketplace charges was pretty small fry and that the big piece of pie was the tier fees.

[Ceka Cianci]

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Carole Franizzi wrote:

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Randall Ahren wrote:

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Ceka Cianci wrote:

i don't understand that part? post at SLU?

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I don't think it's a good idea for Lindens to be posting as Lindens at unofficial forums. This is the official SL forum here and they should post here to build traffic and get more people to sign up to be residents, not at SLU. I understand why they post at SLU, less spam for one and more traffic according to this 

thread

 where a Linden had been posting about the trending tab at SLU.

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Ha! They won't answer questions from residents on their own official forums, but answer them on external ones? Oh, that's funny...

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one thing i have noticed is this..the CEO shows up in the forums here more than the lindens do..well not counting Torely..

a linden even showed up in the SLU thread about the securities on our profiles being lifted..

i hadn't checked in the thread here about that to see if one had showed up here..i'm gonna have to find it and see..

that would be kind of sending a bad vibe if they show up there and ignore the same exact thread here..

 

ETA: i just checked the security thread here and Rhett linden did show up in ours as well..so i guess thats a good thing lol

[Sy Beck]

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Mayalily wrote:

Also, with mesh and spulpties, that is far, far less than prims.  Perhaps LL should make it .30 lindens to the sculpty or mesh instead of 1L per prim (If I have that info correct on the prim). 

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I have not the slightest, iota of an inkling of what you mean by this.

[Ceka Cianci]

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Sy Beck wrote:

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Mayalily wrote:

Also, with mesh and spulpties, that is far, far less than prims.  Perhaps LL should make it .30 lindens to the sculpty or mesh instead of 1L per prim (If I have that info correct on the prim). 

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I have not the slightest, iota of an inkling of what you mean by this.

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i think she is saying that  since mesh and sculpties would save on prims that they should charge less for mesh or sculpty?

i thought mesh went my how much room they took up..i'm still not worded in the ways of mesh yet myself hehehe

heck i don't know.. i didn't want to post up and ask about it..but since others are curious i figured..now i'm not alone hehehe

maybe she will rephrase it for us..i have been curious since last night hehehehe

 

 

[Phil Deakins]

She's mixing sculpties and mesh up. They do charge extra for uploading a mesh, but uploading sculptmaps is the same as uploading any texture. I can't undertand why it comes into this conversation though.

[Sy Beck]

@Ceka & @Phil

 

Hmm...ok, I'm glad you can fathom her mind.  It was the L$1 for a prim that had me.

[Ceka Cianci]

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Phil Deakins wrote:

She's mixing sculpties and mesh up. They do charge extra for uploading a mesh, but uploading sculptmaps is the same as uploading any texture. I can't undertand why it comes into this conversation though.

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ya i know mesh can cost more..i had heard of 150 on some uploads..i believe the cost is by how complex they are on upload and prim cost is determined by how much space they take up in a sim..

thats about what i've heard anyways hehehe

i think she was just looking at ideas of how LL could help with costs on some things..

but thats just me guessing hehehe..i really don't know actually  Oo

[Ceka Cianci]

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Sy Beck wrote:

@Ceka & @Phil

 

Hmm...ok, I'm glad you can fathom her mind.  It was the L$1 for a prim that had me.

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oh no..i was just guessing and assuming the best i could..

i am still as curious as i was last night hehehe

[Venus Petrov]

I assume you have already created a blog that advertises any new content you create and you have applied for and joined some feeds that will further expose your goods.  Or, you have asked some popular bloggers to evaluate and write about your stuff (which then gets on one or more feeds, gaining you more exposure).

I see many new content creators blogged and I visit new shops all the time. 

[Mayalily]

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Sy Beck wrote:

@Ceka & @Phil

 

Hmm...ok, I'm glad you can fathom her mind.  It was the L$1 for a prim that had me.

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It is 1Linden a prim from what my rental landlady told me.  So, as I was thinking since sculpties and mesh will be such way fewer "prims", why can't the price be reduced from 1L a prim to say a fraction of that, and my price figured .30, although sculpties can be anywhere from 10x less land impact.  Or is my landlady saying the wholesale price is 1L per prim to upload or rez onto her rental sim/rental house?  She practically charges me the wholesale price for my rental (or my prims).  She makes about 50 lin profit a week from me if even that as she uses the sim to "learn" and experiment and have fun right now rather than looking for profit. 

Anyhow, so 1L a prim unless I've completely misunderstood, which wouldn't be unusual because I've stated many times I am not a creator and my username is a complete coincidence to the Maya software which I never heard about until I visited these forums.  Now, let's talk a pot belly stove.  I saw a pot belly stove for 14 prims today.  I have a sculpted 2 prim pot belly stove currently in my SL house.  In other words, the land impact is far less with sculpties.  Thus, we can fit more SLuff with sculpties and I heard mesh was going to be far less in prims?  As far as mesh, too new for me to understand.  So, just take sculpties as far less land impact...couldn't they then help to lower prices of the land and the tier? 

Anyhow, I'm not a creator or a land owner, so don't listen to me.  I'm in SL for fun and not profit at this time, and still learning.  I have way too much to learn to want to go into a SL business right now.  Perhaps after the New Year for me as it depends on the economy, which I think is going to be way worse this time with the Great Recessions.

Anyhow, sculpties what can they do to affect the land impact?  Are you all saying nothing?  If sculpties and mesh can help nothing, then what the heck is mesh for?

[Phil Deakins]

You can't actually upload prims, Maya. You only upload textures. (You can also upload animations and other stuff, but sculptmaps are textures, and meshes are similar)

With sculpties, the texture is the sculptmap, which turns a prim into the required sculpty shape according to the map (sculptmap), and it costs the same to upload as any other texture - 10L. You can get a lot more "shapely" objects onto a parcel by using sculpty objects, because sculpties are used to create nice shapes without needing to use extra normal prims to achieve the same nice shape. Also, you can use 1 sculpty prim for several object parts. I use 1 sculpty prim for all my furniture that has 4 legs, for instance - 4 legs/feet but only 1 prim.

LL charges more to upload meshes. I've forgotten how much because they've never interested me. Mesh objects are treated differently. A mesh object may be created using just 1 prim, but it's counted as a lot more prims for the land. For instance, mesh is no good for low prim furniture (my business) because a piece of existing low prim furniture that uses, say, 5 or 6 prims (sculpties and/or normal prims, or both), would count for a *lot* more prims than that if it were made using 1 prim and mesh, so you could fit fewer objects on the parcel.

I'm not sure what you're driving at but, if your landlady told you 1L per prim, then that'll be the rental cost to you, and has nothing to do with uploads or tier costs.

LL have been steadfast in not changing the tier structure or the cost of tier, presumably because they'd run the risk of not recovering what they would initially lose, and tier is the mainstay of their income. People often want tier to be reduced, but it would be a huge risk to LL's income, which they may never recover. For a long time, I've had a different idea, which is to have more tier levels - smaller jumps in land and tier costs. Tier isn't bad at the low levels but, when you reach, say, 32k of land, then the next step is 64k - a large increase in cost. After 64k, it's 128k and, after that, it's 256k, each with huge cost increases. If they stuck some more levels in between, it would encourage people to go up in small levels.

In both cases, it would initially drastically reduce LL's tier income, and, understandably, they are very reluctant to take the risk, especially since it can't be known whether or not the initial loss would be recovered and even more profits from tier would result due to higher land ownership..

 

[Mayalily]

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Phil Deakins wrote:

You can't actually upload prims, Maya. You only upload textures. (You can also upload animations and other stuff, but sculptmaps are textures, and meshes are similar)

With sculpties, the texture is the sculptmap, which turns a prim into the required sculpty shape according to the map (sculptmap), and it costs the same to upload as any other texture - 10L. You can get a lot more "shapely" objects onto a parcel by using sculpty objects, because sculpties are used to create nice shapes without needing to use extra normal prims to achieve the same nice shape. Also, you can use 1 sculpty prim for several object parts. I use 1 sculpty prim for all my furniture that has 4 legs, for instance - 4 legs/feet but only 1 prim.

LL charges more to upload meshes. I've forgotten how much because they've never interested me. Mesh objects are treated differently. A mesh object may be created using just 1 prim, but it's counted as a lot more prims for the land. For instance, mesh is no good for low prim furniture (my business) because a piece of existing low prim furniture that uses, say, 5 or 6 prims (sculpties and/or normal prims, or both), would count for a *lot* more prims than that if it were made using 1 prim and mesh, so you could fit fewer objects on the parcel.

I'm not sure what you're driving at but, if your landlady told you 1L per prim, then that'll be the rental cost to you, and has nothing to do with uploads or tier costs.

LL have been steadfast in not changing the tier structure or the cost of tier, presumably because they'd run the risk of not recovering what they would initially lose, and tier is the mainstay of their income. People often want tier to be reduced, but it would be a huge risk to LL's income, which they may never recover. For a long time, I've had a different idea, which is to have more tier levels - smaller jumps in land and tier costs. Tier isn't bad at the low levels but, when you reach, say, 32k of land, then the next step is 64k - a large increase in cost. After 64k, it's 128k and, after that, it's 256k, each with huge cost increases. If they stuck some more levels in between, it would encourage people to go up in small levels.

In both cases, it would initially drastically reduce LL's tier income, and, understandably, they are very reluctant to take the risk, especially since it can't be known whether or not the initial loss would be recovered and even more profits from tier would result due to higher land ownership..

 

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Okay, thanks Phil, that explains some things to me. 

I also looked at another rental sim yesterday and the rents were so inexpensive, it got me to thinking how are they making their tier with these low rentals?  It was a nice rental sim with lots of cute houses, and I didn't see any empty and they are hardly charging anything for it and you get a lot of prims compared to what I've seen others charge for rentals.  Anyhow, I do wonder how they make their tier?

However, with sculpties, less land impact, that would mean LL could have more land.  The more land you have, you create a glut.  When a glut happens, the price should go down.

I wish LL would break up the land so people could afford a small island.  Why do these sims have to be so big and shared like that?  Is it because of the servers and LL doesn't have enough to break up the land like that?  I think more people would buy land if they didn't have to pay a profit to a resident for part of their sim.

As far as LL losing part of their profit, well that happens in a Great Recession as this one has been called.  You either create a new business model that people are willing to pay and can afford, or you fold and lose all your profit. 

 

 

[Phil Deakins]

LL has a HUGE amount of land that nobody is buying. They are selling it for 1L per square meter, exept in the auction where they start it at 0.5L per square meter. The price of land can't go down any lower. A few years ago, they liked to keep land prices around the 6L to 7L per meter mark, and they released new mainland sims when prices were rising, for that purpose. Then they flooded the market with new sims and the number of people using SL went down, so the result is that there is far too much land for sale or abandoned now, and it hardly sells at all. So the quantity of land doesn't come into it.

LL also introduced free Linden Homes for premium accounts. That, and the extremely low cost of land, caused landlords to lower their rents in order to compete, which is why you see rentals at very low rents.

The size of sims is built into the programming of the system. They don't break them into smaller islands, but they do do something similar. Homestead sims and Open Space sims (do we still have Open Space sims?) are the normal size but they support a fraction of the prims, so the tier is a lot less for them. Unfortunately, LL won't sell them to all who want them. They only sell to people who first have a full sim. Incidentally, Homesteads may be the reason you saw some very low rents.

There is loads of mainland for sale - loads of it. And it's mostly incredibly cheap. You do have to be a premium member to buy some though.

LL's profits: yes, companies do lose profits for various reasons, but very few will intentionally bring it on themselves, which is what they would be doing if they lower the tier or add more tier levels.

[Randall Ahren]

Are you certain that most of LL's revenue from SL is from tier? My understanding of LL is that it is privately held and so we are not privy to balance sheets and cash flow statements. Hence, we can only guess at the financial situation.

If LL's main source of revenue is from tier, their behavior is puzzling. For example, why allow the marketplace? That reduces the demand for land for storefronts because sales can be achieved without the need for large stores. You basically only need 16 sqm to rez a magic box. In addition, why the push to develop sales directly from a merchant's inventory? That will further reduce the demand for land because now you will not even need a place to rez a magic box.

Perhaps the bulk of the revenue has shifted to marketplace sales? Otherwise, why would LL behave in this manner?

 

[ralph Alderton]

If Linden Lab want to seriously increase their revenue lowering tier is essential.

It's only people who don't believe in SL's potential and future who say that tier is the right price.

Tier is currently set at the wrong price, that's why SL is stagnating.

LL should let anyone buy a HS without a full sim, lower tier and watch SL boom again.

If LL halved tier costs they'd sell tons of sims and more than double their money.

High tier costs are strangling and suffocating the whole ecosystem.

It's all about the land.

 

[Alazarin Mondrian]

Agreed, Ralph. People have been saying this for years.but does anyone at LL ever listen?

[Marcus Hancroft]

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ralph Alderton wrote:

If Linden Lab want to seriously increase their revenue lowering tier is essential.

It's only people who don't believe in SL's potential and future who say that tier is the right price.

Tier is currently set at the wrong price, that's why SL is stagnating.

LL should let anyone buy a HS without a full sim, lower tier and watch SL boom again.

If LL halved tier costs they'd sell tons of sims and more than double their money.

High tier costs are strangling and suffocating the whole ecosystem.

It's all about the land.

 

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I completely agree with this, Phil.  If Linden Lab would get rid of the ridiculous $1,000US set up fee and halve the tier costs, many more people would buy sims and start paying tier.  As has been said once in this thread already, "I'd much rather sell 100 at $10L than 1 at $1,000L." 

Make Homestead sims available to all whether or not they already own a full sim.  That requirement has always mystified me. 

When I first joined Second Life in 2008, I lived on a huge estate that, at its peak was (if memory serves) 56 sims.  All those sims were connected together and so one could get in a vehicle and drive the roads and waterways of all 56.  There was a full (voluntary) police force there (of which I was a part) and I patrolled all 56 sims.  That entire estate is gone now.  I susect that if tier fees were lower that estate might still be there, and so would I.  It is large estates such as that one that is needed again.  However, I don't see that happening with the current fees. 

Yes, there are still large estates around, but they are set up in a scattered fashion instead of all their sims being connected with roads and waterways.  You look at the map and see an almost checkerboard layout of sims.

 

[Phil Deakins]

@Randall

No, I'm not certain that tier is LL's main income. It's my best guess, and I very much doubt that it's a wrong guess. They did state where their income came from a while back but I don't know where to look for it. I don't recall being surprised by it though, and I'm sure I would have been astonished if by far the biggest chunk wasn't from tier.

 

This is the way I see it...

They flooded the market with land, to the extent that they are unable to sell new mainland any more (that's not just opinion), and that means of increasing the company income was dead. Any company will look for ways of increasing income - hence the marketplace. LL's thinking was probably that they would lose some tier due to sellers not needing land, but that would be more than compensated for by the extra they would make from commissions.

I doubt that much tier has been lost due to not needing it for stores. Yes, there are loads of people selling in the marketplace without inworld stores - maybe most MP sellers - but would they have bought land and opened stores if the MP wasn't there? I think that most of those sellers are so small that they wouldn't be selling anything if there was no MP. Some of them would try renting in a mall for a short time, but would then give it up. I also don't think that significant sellers would close down inworld because they can sell in the MP. On the whole, they do both. I think that LL made a calculated decision to lose a bit of tier, and expected it to be more than compensated for in MP commissions.

It's true that there is a lot more land either for sale or abandoned these days, but I'd put most of that down to LL flooding the market with it, the active population decreasing, and reasons other than the MP effect.

But... if LL substantially reduced tier, as many think they should, they would lose a hell of a lot of income at a stroke, and they would have no way of knowing whether or not they would recover much of it. I am sure that there would be a bit of a land rush initially, but I doubt that the extra land ownership would be maintained for very long, as the new tier costs become normal, and other factors that cause people not to own land, and not to own as much land, take over again. Any reduction would have to be substantial to have any effect, so it would be a *huge* risk.

Even keeping the general tier costs the same, but adding more levels between the big jumps, would be a huge risk. It would hugely reduce the tier payed by existing land owners, in the hope that they would buy a little bit more.

So, all in all, I don't think that LL is killing land ownership with the MP, to the extent of LL's income suffering. I've no doubt that the MP has some negative effect on tier income, but nowhere near the positive effect of the MP income.

[Sy Beck]

I find it a delicious irony that in an internet age where irl people shop more and more online that in SL, a prime example of living a life online, people are requesting that others travel to shops inworld rather than do the SL equivalent of shopping online via MP.

P.S.  I agree with them though.  :smileywink:

[Phil Deakins]

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Marcus Hancroft wrote:

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ralph Alderton wrote:

If Linden Lab want to seriously increase their revenue lowering tier is essential.

It's only people who don't believe in SL's potential and future who say that tier is the right price.

Tier is currently set at the wrong price, that's why SL is stagnating.

LL should let anyone buy a HS without a full sim, lower tier and watch SL boom again.

If LL halved tier costs they'd sell tons of sims and more than double their money.

High tier costs are strangling and suffocating the whole ecosystem.

It's all about the land.

 

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I completely agree with this, Phil.  If Linden Lab would get rid of the ridiculous $1,000US set up fee and halve the tier costs, many more people would buy sims and start paying tier.  As has been said once in this thread already, "I'd much rather sell 100 at $10L than 1 at $1,000L." 

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I don't say that the current tier prices are right. I'm only saying that reducing them substantially would be a huge risk for LL.

I completely agree about homesteads. I can't come up with any reason for LL not to sell them to anyone who wants one. Perhaps it's to do with not wanting to get on the wrong side of mega-barons.

I also agree about the setup fee. A small setup fee would be reasonable, but $1000 is taking the p..s. It used to be $1750!

Would that large estate that you mentioned still be there if the tier was halved? I don't think so. Tier dictates rents. If tier is high, rents are high. If tier is low, rents are low. What can't happen is tier to be halved and rents stay the same. It can't happen because land owners have to compete for tenants, so all land owners would have to bring their rents down to compete and stay alive. With halved rents, that estate owner could make the same profit as with normal rents, so I think the reason the estate is no longer there is probably due to the fierce competition in that market, and not being willing to continue for a relatively small profit. LL bringing out Linden Homes was bad for that market, and may have had something to do with the estate's demise.

 

ETA:

The phrase was, "I'd rather sell 11 at 100L than 1 at 1000L" - not 100 at 10L which equals 1 at 1000L I'd rather sell 1 at 1000L than 100 at 10L because there'd be much less in the way of customer service to do