Who Needs it Most? Pt. 2

You never said, "A number of people do use it for that, however. And they can bring their money with them. If LL wants the business of these people, I do not think it is in their interest to make people work from the get-go," implying that if LL doesn't do X, newbie retention rates will fall?

Well, if that was what I got the most pleasure out of in SL, then buying lindens or getting premium would be the popular thing to do. Is that really the case? I don't know. I do know that the majority of people are on basic, aren't they? If they have stayed in SL after a few months, they are either making money or buying lindens, since 200 a month isn't enough to shop with. If they are just using it to upload, that is less than a dollar a month, which is the same amount they get for the free trial. If they won't pay a single dollar a month for a game they may spend hours and hours in I don't know how to please them.

Have a look at most every other MMO out there. MOST of which have stable economies.

Did you know that most of them start new folks out with some scratch to learn the game and decide if this is the world for them? FFXI has their adventurer's coupons, EVE gives you some scratch for completing the tutorial, hell even There starts you out with some money.

And somehow, they are all still getting new players.

Wtf? Everybody's complaining about entitlement and all this other negative bullshiat, when it comes down to simple business sense. SL is infinitely less fun with no money, speaking from personal experience. LL is giving the new folks a chance to decide if they like this world, and yes, that includes the shopping side which is a large part of it.

This isnt the real world. You don't come into SL with nothing, you come into it with the basic necessities.

Which is all they need.

The summary: Cutting Newbies/Basic Account Stipends is one Step in what I would hope is a overall strategy to stop the devaluation of the L$ against the US$. It may not seem like much on the surface but when multiplied against the number of users over a period of time it adds up. Perspective must be kept on the fact that we are talking about a world where L$ rule rather than US$.

The Linden dollar has shown a $14 valuation flux since I started spending time in-world about a week ago compared to the US$. This may not seem like much but when you are moving millions of US$ per month through the economy it multiplies into a huge difference.

The Linden’s are trying to control money supply. Right now they are in a period of value loss against the US$ but a deflationary period in-game over the short term. If they correct NOW they might be able to prevent strong inflationary pressures in-world but if they don’t act they will be stuck in a situation where most vendors start cranking prices to keep their profits up and start causing real in-world inflation.

One of the saving graces about linden dollars right now is that it is primarily non-physical assets (maintaining an island could be considered a physical asset although it comes with the equivalent of condo fees) and most of us don’t make our living off of the in-world experience.

The issue with this is Linden is trying to create virtual reality and maintain a real economy. They are trying to achieve something where the average (technical, artistic or just willing to do whatever) Joe can make money and live on the skills they possess so they need to maintain that balance between the US$ and the L$ so that this long-term relationship doesn’t collapse on them.

The methods to do this are for government (meaning Linden) to reduce or increase the money supply and put structured controls into place if they believe in a American style limited free-market economy rather than completely free-market economy.

Stipends, Allowances, Payouts for Traffic, Free Islands or large quantities of money for Contests, etc. are all unnatural manipulations of the economy. In order to reduce the long-term inflationary pressures caused by a large influx of currency and the massive growth in population you have to make drastic decisions if you want the market to function without becoming overheated.

An example of this would be if the US government decided to just start printing dollar bills and pay down debt using those dollars. All those dollars entering the economy would be multiplied due to the velocity of money (how many times the same dollar is spent before it is consumed – example: you pay for a donut, the vendor pays for the dough, the dough vendor pays for the milk – all from the same dollar until it is consumed) and eventually would cause inflation since there were more dollars for the same goods.

IMO Linden is practicing basically the opposite of this philosophy right now – get the heck out of the Free Money business so that the economy can function in a more natural form and devaluation will slow or stop. Five years from now we might be having discussions about how to absorb money out of the economy (maybe reclaiming abandoned land and not reselling it immediately among other things) to reduce inflation but right now the issue is money devaluation against US$. If left unattended it could become wide-scale inflation.

I know that when I signed up to experience Second Life I anticipated something to keep my attention for eight hours or so then be abandoned as most games are. I’m now a week later and am eating it up. It provides me with my real-world money and asset exchange in a virtual system. I anticipate there are thousands more like me joining every month and with this being the case you must be very cautious because you get enough people entering the game with new cash and that provides big demands, especially on limited resources such as land.

So I’m belaboring my point. Linden needs to do what it can to control the L$ weakening against the US$ and in order to do that they need to exit the Free Money market as best they can. Growing is painful, especially when it is rapid.

Maybe a limited Stipend time for new basic accounts was the proper solution but I’m not going to argue how their decisions on Stipends or Dwell bonuses is going to affect the economy. They need to remove lots of cash quickly and those methods are one way to do it. It may irritate or drive some people away but that is what you have to do when you have 200k+ people and rapid growth bringing more external cash to the table all the time. They have to do what they can. If they can create a sustainable viable economy then more power to them if they don’t rape the user looking for profits in the process.

And here is where Linden needs to decide: Are they building a better tomorrow or trying to generate a profit? Both is the natural answer; the key is weighing the good of the long-term over the potential gains in the short term.

I think the $250 they get during the free trial is fine, whether they blow it or save it is up to them, regardless of my own experience. I would still rather have enough money at first to actually buy something right away than have to wait a full month before I could buy anything nice. Then they can decide if this is worth it. I bought more lindens within the first week and still wasn't sure about SL. But a few dollars went a long way and it makes you think about how to earn it "in world" instead of paying cash. Which is the whole point.

Yes. What's the problem? "Existing customers leaving" is different from "new people never becoming paying customers."


Again, I don't think people should get free lindens indefinitely. After a month (or at most, two), cut off the supply, and don't give any to additional basic accounts. I am referring to the true newbies, for whom the basic accounts function as a free trial, who may still be reluctant to plunk down real money for "virtual" goods, and who are not sure that SL will be a game they spend hours and hours on.

of course you have more important things to do!........ yeah right!