Profit from Owning Private Island

[Shayne Turbo]

Could someone please explain to me how land owners make a profit owning full prim private islands? I have seen the prices people are charging to occupy their land and the amount is only enough to cover the $295 per month tier. I suppose if you had a grandfathered tier of $195 you would be making a profit if your sim was full but I just don't see how anyone makes money after paying the $295 tier.

[Ceera Murakami]

Honestly, there's not a lot of profit any more in being a landlord. The big players that own huge numbers of sims get a "sweetheart deal" from LL that gives them lower start-up costs and lower monthly overhead. They can set their pricing at what would, for anyone else, barely be break even, and can still show a profit. The little guy with only a few sims is lucky to break even, and often is doing it mostly because he wants part of the sim for his own personal reasons, and the tenants just help make the monthly payments bearable.

[Phil Deakins]

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Ceera Murakami wrote:

The big players that own huge numbers of sims get a "sweetheart deal" from LL that gives them lower start-up costs and lower monthly overhead.

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I prefer the term, "quantity discount". "Sweetheart deal" sounds a bit like favouritism, but what LL do is give perfectly normal quantity discounts. If they didn't, they would abnormal. I've no idea if they have set quantitty discounts or if each is negotiated but, whichever it is, it's only a perfectly normal quantity discount that anyone can get.

[Ceera Murakami]

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Phil Deakins wrote:

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Ceera Murakami wrote:

The big players that own huge numbers of sims get a "sweetheart deal" from LL that gives them lower start-up costs and lower monthly overhead.

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I prefer the term, "quantity discount". "Sweetheart deal" sounds a bit like favouritism, but what LL do is give perfectly normal quantity discounts. If they didn't, they would abnormal. I've no idea if they have set quantitty discounts or if each is negotiated but, whichever it is, it's only a perfectly normal quantity discount that anyone can get.

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If LL publicly posted that the Atlas Program exists, and what the qualifications were for getting that volume discount, and anyone who met those requirements got the discount without jumping through additional hoops, then I might agree it was a more normal volume discount. But they don't publicly acknowledge that such discounts exist, and they only offer it to certain 'friends' that they choose to let into the program. That, in my mind, makes it a "sweetheart deal".

[Pussycat Catnap]

The best way to make a proti from owning a private island is to sell it to the next sucker.

 

[xxLena]

assuming the 295 usd is a fact,i'd say...

with rent between 20-25k / week ... 300-370 usd / month ...

multiplied by 300 or 1000 sims

adding possible quantity discount mentioned above in thread

subtracting set up fees, loss for unrented plots, taxes, maybe staff and advertising costs

it probably pays off good over time.. as long as the game is running steady.

[Phil Deakins]

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Ceera Murakami wrote:

If LL publicly posted that the Atlas Program exists, and what the qualifications were for getting that volume discount, and anyone who met those requirements got the discount without jumping through additional hoops, then I might agree it was a more normal volume discount. But they don't publicly acknowledge that such discounts exist, and they only offer it to certain 'friends' that they choose to let into the program. That, in my mind, makes it a "sweetheart deal" or favouritism.

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They have publically stated that it exists. I was there when Jack said it.

It's not necessary for a company to publish what they do about quantity discounts. Some do, of course, but most don't, but if you want to buy a significant quantity of something, and you ask for a discount on the strength of the quantity, you will usually get it. LL isn't any different. You tell them that you intend to buy 50 sims, and ask for a discount. You'll get it. It's available to anyone, so it's not a "sweethearts deal" or favouritism.

[Melita Magic]

Grandfathered tier usually. Pooled group tier maybe. Owning in excess of a gazillion sims and the charges even out maybe.

Some people also just like to be landlords as a sort of roleplay or something to do in Second Life (or to just own some land themselves), and are happy if they break even.

 

[Exavor Diesel]

I have one sim and would break even if it wasn't for the fact that I live in the EU and have to pay 20% VAT. I make a loss of around $50US a month. I keep some of the land for my own personal use so it's not that bad although I wish they'd stop charging me VAT!

[linkin Slate]

Im sure to the lindens a discount to them is a fair trade off. and good for Business.

Take the mainland for example. from a report. Link below.

http://www.sluniverse.com/php/vb/virtual-business/68200-mainland-census-december-2011-a.html#post1463098

abandoned land is somewhere between 29,713,664Sqm and 34,753,312Sqm or 6.7% to 7.8% of all Mainland - an equivalent of 453 to 530 full regions. 

At 195 Teir thats about 87,750 usd lost a month.

Plus Mianland has unuseable land, roads (prottected area's). non teir produceing land.

Plus they have to manage and listen to complaints.

 

Now by given, the landlords a discount,(They ) manage the land, deal with the renters(the Complaints),and the Lindens recive 100% of the teir, monthly, the landlords buffer any  land not produceing.

And looking at the way things been going and land prices, im sure the landlords and wonder what they all got them selfs in to,     They show over 500 sims  removed from grid in last 2 months .