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Results from SL Economy Poll


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Something tells me we are soon to be embarking on a new paradigm for SL.  The economy is currently a closed system for the most part with little impetus to bring in new revenues from outside.  This requires a credit card or pay pal investment into the game.

We had this with gambling and with the corporate presence where large amounts of funds entered the game.  If you crunch the numbers, you see that out of the 15,000 million or so registered users, only 1.5 million logged in over the past 90 days.  Given that alts count, we can safely assume that of those 1.5 million, less than 1/2 are unique.

This tells me that we could very easily have 13 million accounts with Lindens in then that will never be spent.  We also have many merchants that take money out on a regular basis.

Where this leaves us is in that we need new revenues to enter the world to grow the economy. 

I love how SL replicates so much of RL here.  We need revenues to come into the game or for those pockets of money to get spent.  LL could impose a tax on all unused funds then re-distribute those funds much like communism or the current US administration proposed or they could open the potential for revenues models to enter.  RL commerce has been banned, Gambling has been banned and corporate America left when the Electric Sheep, Millions of Us, Rivers Run and our adult marketing group, Mountainmiester Media pulled out.

So the question is what next?  What will drive this economy in the future or will there be an economy that we can profit from? 

Keep in mind that SL wasn't planed to be what it is today, it just happened.  It was intended to be a game platform where you could build your own game and charge people to play that game.

But instead a social community developed and people built not games but houses, cars, boats and clothes quickly creating an economy of all sorts of wild enterprises.  And with every other free market economy, it follows the same basic postulates. Value, demand and resources all play a significant part in this economy so where what will be leading the charge in 2012?

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There are 27 million SL accounts since 2003, with 20000 new sign-ups each day (new users + Alt accounts) That's the current run rate.

About a million Avatars login per month

About 850,000 are residents that login more than once per month (which suggests 150k to 200k new accounts logged in just once into SL and then leave, never to return)

about 475 k + spend 1 linden dollar or more in SL during month

about 200k spend over over 2000 L per month, it suggest about 25% support the grid (200k out of 850k), by either buying Lindens or generated via an SL business (Pay LL tiers or EO rents with in-world sales)

 

Missed opportunities.....I believe Second Life could have been much bigger in terms of active users ...thats if Second Life Grid could have scaled to accommodate the extra growth.

Some ex-Linden employees seem to think that it would not scale....and LL knew that.  Maybe that's the reason LL never spent any large amounts of money on Marketing & Advertising like IMVU and some of the VW's or Games.

I think there are workaround solutions if the existing Grid could not scale to acccommodate huge growth. They could split it onto 2 Grids and use the Open sim Interportability system to get from Grid to the other....so in theory they could have 20000 sims on each Grid with 60-70k  peak logins in each. They do have 2nd login Grid already ....with the Beta Grid.....so it could be done, just need the system to Transfer from one Grid to another inside the Viewer and not having to log out.

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Voted worse primarily because we're shrinking and "tier will not be raised in 2012" and "we're getting into new projects unrelated to SL in 2012".

Solution to improving the economy is to get rid of the "economy" for sensible flat fees and lower tier. Less sinks. Can't see that happening in 2012 to the degree that it's going to provide the necessary stimulus it would take to recover in 2012.

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Dartagan Shepherd wrote:

 

Solution to
improving the economy is to get rid of the "economy"
for sensible flat fees and lower tier. Less sinks. Can't see that happening in 2012 to the degree that it's going to provide the necessary stimulus it would take to recover in 2012.

i don't understand that highlighted section......how to improve the SL Economy is to get rid of it?

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Oh, meaning the concept of economy in general. Fixed rate on the exchange rather than this floating against the dollar thing, sinks that give the illusion of needing to juggle economic conditions, flat fees everywhere such as classified ads.

The elements that contribute to SL having an economy. It doesn't need a "sink" to balance economy, if you want to fee something, fee it.

Auction elements of land, floating prices.

It's not really an economy as much as a manufactured set of charges. Besides contributing to adding more cost, these mechanisms add cost to operations to maintain them. Why would LL need an "economy" in the first place. Entertainment value? Good idea at the time?

Simple pricing plans and fees. It's not an economy.

How economic are the new fees for mesh upload? Its a sink? No, it's a fee. Should get for instance some of these features in a premium account.

My web hosting company doesn't sell me on economy, it gives me pricing packages. My cable bill doesn't sell me an economy, although it does give me a pretty itemized breakdown of fees.

It's a fiction applied to real money.

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LL did not plan to have an inworld economy, they just stumbled upon it.....or more to the point, it's pioneer Residents spotted the opportunity to buy and sell items within the platform not LL....plus the GOM incident.

When LL released Land to its residents, it was the Resdients who in turn spotted the opportunity of the Land rental market.. Since those days, LL have made a concerted effort to profit from very business activity somewhere along the line.

You could not flat fee Classifieds as you would not be able to determine rankings for any given keyword. I suppose you could randomise the listings if everyone is paying the same....that way your advert gets a spell near the top of the Listings as does everyone else.

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Dartagan Shepherd wrote:

Oh, meaning the concept of economy in general. Fixed rate on the exchange rather than this floating against the dollar thing, sinks that give the illusion of needing to juggle economic conditions, flat fees everywhere such as classified ads.

The elements that contribute to SL having an economy. It doesn't need a "sink" to balance economy, if you want to fee something, fee it.

Auction elements of land, floating prices.

It's not really an economy as much as a manufactured set of charges. Besides contributing to adding more cost, these mechanisms add cost to operations to maintain them. Why would LL need an "economy" in the first place. Entertainment value? Good idea at the time?

Simple pricing plans and fees. It's not an economy.


They never promised you an economy. They simply said: here it is, 'your world, your imagination', do with is as you want.

We as buyers and sellers, as estate owners and renters created an internal economy. For LL it is just playing with tokens, this inworld economy. They went after businesses and universities to participate in a world that was growing in a conflicting direction. And when that became more or less clear to them they put their energy in building private corporate sims behind a firewall, away, away from that grid with those **bleep** throwing griefers.

Those are complete lost years, LL did not really understand who their customers were and what economy is behind that big ship of money that just kept coming every month. Actually I think they still didn't fully get it, when they decided to make the marketplace the most promonent shopping place in SL. Why don't they want to receive this tier from inworld shops any longer? Their core business is land, so why pushing people away from what they are selling them?

When in the end nothing worked with pushing the product toward corporate and educational use, they first started to think: hey, our current residents? Why are these ships becoming smaller? We are not loosing them, are we? We better concentrate on the ones who keep the business running now, before we they keep on voting with their feet.

In world economy, never heared them say it was under their attention. They try to care for their customers in a way that they think we want, like giving a Linden home in stead of 512 bare land. Or a premium sandbox and a freebie.

I don't expect them to dive deep into the internal economy in the future either. They will think more like: Your imagination, you created this ecomony, now take care of it yourself a well. Be creative and let your imagination speak. Friendly greetings.

 

 

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But what are they actually telling in those stats? They are about 'the economy between Linden Lab and its users', not about the internal SL economy.

How often they log in, how many hours, how much land they own, for what amount they sell on the marketplace, and so on. 

Nobody at the lab, is able to show us for example: How many SL business gave up in 2011? What was the amount of money those businesses made in the year before? How many land was abandonned because creators gave up? How much new SL businesses entered the market in 2011? What is the percentage of sellers on the marketplace versus those owns an in world store?  How do the sales on the SL marketplace related to the inworld sales in 2011, preferable split by sector. What amount was the top selling business worth for in 2011?

Nobody has any clue about these things. So as a merchants you are just walking blindfolded, you have no idea how you are doing compared to others in your sector of the market... or with an idea mainly formed by what you hear about how other businesses are doing. But is long as nobody can provide the bigger picture of what is actually happenning you will only have a look at it from a small perspective.

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Madeliefste Oh wrote:


Dartagan Shepherd wrote:

Oh, .,.. ... ... economy.


They never promised you an economy. They simply said: here it is, 'your world, your imagination', do with is as you want.

We as buyers and sellers, as estate owners and renters created an internal economy. For LL it is just playing with tokens, this inworld economy. They went after businesses and universities to participate in a world that was growing in a conflicting direction. And when that became more or less clear to them they put their energy in building private corporate sims behind a firewall, away, away from that grid with those **bleep** throwing griefers.

Those are complete lost years, LL did not really understand who their customers were and what economy is behind that big ship of money that just kept coming every month. Actually I think they still didn't fully get it, when they decided to make the marketplace the most promonent shopping place in SL. Why don't they want to receive this tier from inworld shops any longer? Their core business is land, so why pushing people away from what they are selling them?

When in the end nothing worked with pushing the product toward corporate and educational use, they first started to think: hey, our current residents? Why are these ships becoming smaller? We are not loosing them, are we? We better concentrate on the ones who keep the business running now, before we they keep on voting with their feet.

In world economy, never heared them say it was under their attention. They try to care for their customers in a way that they think we want, like giving a Linden home in stead of 512 bare land. Or a premium sandbox and a freebie.

I don't expect them to dive deep into the internal economy in the future either. They will think more like: Your imagination, you created this ecomony, now take care of it yourself a well. Be creative and let your imagination speak. Friendly greetings.

 

 

applause 2.gif

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Madeliefste Oh wrote:

But what are they actually telling in those stats? They are about 'the economy between Linden Lab and its users', not about the internal SL economy.

How often they log in, how many hours, how much land they own, for what amount they sell on the marketplace, and so on. 

Nobody at the lab, is able to show us for example: How many SL business gave up in 2011? What was the amount of money those businesses made in the year before? How many land was abandonned because creators gave up? How much new SL businesses entered the market in 2011? What is the percentage of sellers on the marketplace versus those owns an in world store?  How do the sales on the SL marketplace related to the inworld sales in 2011, preferable split by sector. What amount was the top selling business worth for in 2011?

Nobody has any clue about these things. So as a merchants you are just walking blindfolded, you have no idea how you are doing compared to others in your sector of the market... or with an idea mainly formed by what you hear about how other businesses are doing. But is long as nobody can provide the bigger picture of what is actually happenning you will only have a look at it from a small perspective.

Sorry, completely missed this post earlier.

Agreed, not the kind of information that's really useful, and they've never painted the real picture. Aside from some things that are able to be verified, like the amount of land/regions.

Sadly I don't even believe some of them any longer. For years they've glossed over the picture that most informed users couldn't match with their own experiences. Had to stop advocating for LL, because the more I did, the closer I got to spin. Toward the end, I was rightfully accused of waffling and spin.

In fact I think, Rene here accused me of waffling back in the M Linden days and he was right. (Oops, I had my reasons, and was being fed Kool-Aid intravenously at the time!). He got Jack Linden and M Linden fired though, so I figured I should clean up my act before he came gunning for me. If he can get Phil and Mitch off the board we might actually stand a chance at professional integrity, reasonable prices and useful stats.

Everyone knew concurrency figures were off, but most of us would still debate about them, as if they weren't.

We do see gross Marketplace sales, but that tells us nothing (except to figure out how much 5% commission is out of that).

They have all the numbers available to them, so I'm not sure why they won't show merchant based figures both for the Marketplace and in-world. Then again, they've never treated their customers as adults in any professional sense.

I harp on the lack of sales charts, because I don't think they want to give them. What would the average merchants charts look like if they were to show 90 days by individual product and overall sales? Too easy to track at a glance how Merchants are performing. We used to take screenshots and share those on SLX forums so that we could compare each others sales and trends.

Hoping though that something useful is coming that rather than indicate economy (no secret that I think there's no such thing here), we just see useful statistics and information.

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Well it is interesting and refreshing to actually here your admission of the dark days of the Merchant forums of 2009 2010 when you and I had it countless times because of what myself and a couple others saw your blind "head cheerleading" days. 

I fought hard against your stances because it many of your comments were just defying logic to me.  I kept saying to myself "Dart does not come across as a stupid man so what is really behind his stances when and logical business assessment minded person could see all the risk factors and weaknesses that were screaming out from LL's operations and yet he sees everything as ALL POSITIVE".  The more I witnessed it - the harder entrench I became to expose the the true reasons behind why you took such a clearing illogical position.

I will say that I am glad that those days of that "LL CheerLeading Squad" and our battles are over.  As much as you really ticked me off those days, I knew you were a smart man - just with biased opinions and being driven for reasons most of us were not allowed to know.

A lot of people have suggested that being critical of LL and attacking their weaknesses does nothing good to help LL.  I still do not agree with this position.  A healthy growing company can listen to criticism and use it to improve.  LL hasnt figured that part out because they rarely listen to those that criticize them until they are forced to publicly acknowledge it.

Having you as a LL Knowledgable posting critic of LL is a good thing for LL - even if they dont know it.

Glad to have you on the side of reason now. :)

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Dartagan Shepherd wrote:

 

Agreed, not the kind of information that's really useful, and they've never painted the real picture. Aside from some things that are able to be verified, like the amount of land/regions.

Sadly I don't even believe some of them any longer.

In the beginning I also thought that these figures were ment to give us, the residents, an insight about how the platforum is doing. But later I changed my mind. I think those figures were never ment to give us any insight about the in world economy. Those figures were just one of the marketing tools they used in their attempt to attrack compagnies to settle in SL.

I do believe what they publish. But I don't see it as a barometer for the in world economy. It are just some figures they can get together because they have the data available. One quarter they publish this, next quarter that. When the user to user transactions increase with 30% they show that as measure for succes, when next time the user to transaction don't show such a pretty image, they just publish something else that has increased; total number of voice minutes hit all times high, or: marketplace is great succes. 

But what is happening inworld, they don't know, because they never cared to figure out. They don't have a clue about how much of mainland is used for private use, and how much for business use. When you buy land they don't ask you if you want to use it private or commercial. When you abandon a parcel, they don't ask why you are leaving.

Land is their business, and they just don't care to figure out what people drives to use their product or to stop using it.

 

 

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[off topic]


Madeliefste Oh wrote:


... ... ... One quarter they publish this, next quarter that. When the user to user transactions increase with 30% they show that as measure for succes, when next time the user to transaction don't show such a pretty image, they just publish something else that has increased; total number of voice minutes hit all times high, or: marketplace is great succes ... ... ...

 

It is a mystery to me why when LL began - approximately - with Linden Homes and other "benefits" (ehem) for Premium accounts, LL decided to stop publishing statistics about Premium accounts.

[end off topic]

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Thanks for that. At the time for me there was a plan. Was a very good plan if it could have been followed through with.  My take was that it would have generated a good amount of new users, some new commercial opportunities and at some point, driven prices down for land/hardware and such.

So, trust the management, get some energy going, get behind it, it's worth ignoring the things that are wrong today if tomorrow has the potential to make it all better. A few months after the big bang, a bigger bang with a CEO and 2/3's the employees out the door, in.

Moments after M Linden lands on the birthday cake at SLBB, out he goes and in comes phil ushering in a new (3 month) era of Fast, Easy and Fun. Not sure where that went exactly, but finally starting looking like that might be possible with Rod.

Back to the economy thing though as the evil itself in not matching its userbase though. Was a bit scattershot last night.

It's not so much an economy, but a sales pitch and mechanism to to justify massive sinks. It's so manufactured as to not really resemble economy.

LL's customers are more traditional in nature, expect a bit more. They expect a company to do what they do well, give a quality product for a reasonable price and to keep things simpler.

If for instance you were to nix the exchange and put a fixed fee on buying and selling tokens, it can be adjusted and it's pretty straightforward. No one needs to bother with conversion rates and it generates more trust, it's not an unknown.

The same with pricing and sinks. Presented as fees, they're a simpler and more manageable thing to put into packages and adjust. A premium account that comes with a very specific level of classified ad. parcel search fees, a certain amount of uploads, etc. Multiple packages can then be offered. And so on.

These can be adjusted rather than playing with them with sink mechanisms. They can be integrated into the dashboard, etc.

The thing about a sink also, is that more always get added and they're non-negotiable. They never change. It's an entire part of the system that users don't get any say or input on, and most are ignorant of how much they actually ad up to. That's not a trust atmosphere.

Get rid of the economy mechanisms and now you have pricing points that can be managed, given feedback on, adjusted accordingly as time goes on.

Let's face it, the number one concern a paying userbase has is how much does it cost? That prices overall between "normal" costs such as tier, a premium account, a setup, etc. and costs as sinks are too high. And half of that system is not really designed to be adjusted in a way that we users can appreciate. It's a nickle and dime system, the economy.

Fine, we need tokens. We don't need economy, it's a useless obfuscation. Some of those differences are subtle, some are not. But that's one way that SL is currently a mismatch for its own users and their business models.

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The bottom line for me in any discussion about SL is retention and LL has really done nothing to address that over the last two years. They are infected with feature-itis as if that will cure the problems. I think it's the natural response of engineers. It can all be solved through code. Well hmmm actually it can't. Rebranding (James Wagner Au has some good thoughts on this). In-world live help (bring back the mentors). Make "Search All" actually return relevant results. Give everyone who signs up a stash of non-transferable $L (oops a feature) or maybe a bunch of gift cards to selected stores. Do SOMETHING to restore the in-world shopping experience (no clues here). And yes, revisit The Viewer interface for yet one more time. And give me an official LL Android, iPhone, tablet, whatever app scaled to the capabilities of the platform.

Is all this too much to ask?

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