The current economy within SL

I do - I've got quite a bit of a waiting list now, about as big as it's ever been.

If I believe all I was told it would fill 4-5 regions easy (not counting my void list which would fill seventeen) but when push comes to shove, it's probably two regions worth of wait list for normal land and maybe... oh I dunno, six-eight voids when I finally get around to those.

Now is this typical? Honestly, for someone who tries hard, I'd say yes. Take someone like Alliez, who tries hard. She's well over 80 regions right now.

Honestly, I'm sandbagging it and dragging my feet.

* * * * *

Diamond Age - grin ... yes, loved the book, and calling Caledon residents "Vicky's" wouldn't be unusual at all - I hear it all the time. The parallels to that book are uncanny!

Somewhere deep in this forum there's a thread about our steampunk mainland arcology that is in the works... it might happen in 2009 after some of our crown colonies appear. I suspect you'll have some fun with that when it arrives

Arcology:

http://images.google.com/images?gbv=2&hl=en&q=arcology

Me too. There's a new one:
http://www.amazon.ca/Anathem-Neal-Stephenson/dp/0061474096?tag=word08-20

Not quite a follow on to the quoted post Desmond, but picking up on a previous comment you made...ambling around in the Caledon and connected Sims is quite pleasant because you feel part of a community. Even Dreamland does not achieve that with the possible partial exception of the ocean Sims near Central Park.

People are prepared to pay modest amounts of money to be part of that, as in real life owning property in nice areas has a premium.

Of course on a collective basis that all adds up.

The problem is that we're comparing two different scales here. I'm sure that if you are able to well manage a themed land area, like Caledon or dAlliez, then there's lots of money to be made, but that's if you're prepared to go into a business with US$160,000 of initial investment and US$23,600 cost per month.

The economy for the "hard core professionals" is much different to that for the smaller hobbyist businesses. Now, arguably this is exactly the way capitalism is supposed to go: the professionals can provide services more cheaply and more efficiently than the hobbyists, so all the resources ought to go to them. But the problem is that it disrupts the creative freedom of SL and blocks progressive achivement.

I know the classic "dodge" of blaming "lack of hard work" can always be given in reply, but the problem is that lack of hard work does not exist in a vacuum, and it seems odd to blame people for not doing hard work in a virtual world where they probably have no learned behavioural cues. Many people would and do work harder in the presence of progressive achievement - this has been demonstrated.

What Yumi said. The costs of starting up are also greater now than if you began in 2004 or so. Back then, land was comparatively cheap. Now, a mainland sim is much higher, islands are much higher, tier for islands is higher. Alliez and Des and others that had a nice head start in that particular line of business also have the tools to weather the tough times going forward - an established reputation for competence and fair dealing that allows them to charge a premium instead of resorting to undercutting just to get the lots occupied.

Granted, this doesn't mean that newcomers can't be successful - it's just harder to do because a) it costs more and b) it typically costs them even more by having to price lower just to fill to capacity.

L$ also leave the world by people taking cash out. This could be a merchant, who's creating content and adding value to the world. It can also be by gold-farming campbot operators, who suck on the economy without contributing anything.

I don't think that's right - cashing out means selling the L$ to someone else, so the L$ stay in circulation.

The L does stay in circulation. You can see that by the Linden supply going up every month. The only sinks are uploads, group fees, and parcel directory fees. That is the only way L actually disappears from the economy.

Most "camp farms" are funded by people trying to up their traffic score... in that case, the game doesn't care whether it's 42 noobs or one operator with 42 bots... the traffic is tabulated the same. The Campbots provide the same service to the campsite operator.. usually without all the complaining when something goes wrong and a chair fails to pay off.

Campers DO provide something, they provide traffic. And it's a commodity that campsite operators are willing to pay for. Just because you dislike it, doesn't mean that there's an unfair exchange going on.

If you want to give your money to deserving noobs and are afraid of campbots, run a contest, or just hand out money at your local infohub. But the moment you want their traffic..... you start to realize that it's not all altruistic.

I'd say that most traffic gamers now use their OWN bots.. or "hire" models in their stores. (or use their own bots in their stores!)

Don't forget classifieds, and "partnering" fees... much less the transaction fees that LL tacks on when you cash out/buy L$ through them.

There's something wrong with the SL economy? I'm not feeling it. Making the same cash as always through mainland 512 sales... selling on SLX... just paid obscene amount for mainland (in a beautiful sim though--so rare on mainland) 29k for 1536!

This is not possible since the scripts are server side, it's like stealing my mouse via internet (!) ....so, it is techcnical possibile, because of serious bug that a scripts loses his restrictions being "full perm" (but it still reside on the server! so you would read a plain text file, you are not technical ripping the script from an object), so you would have time to steal the scripts until the bug is fixed (aka: you cannot have any script of second life). A similar problem occured in the past with the sex-gen(tm) creator... and the person got sued in RL (and lost it...). Only few parameters of a script are executed client side (eg: particles effects; client side rotations.. ecc.) but you would never have the script.

While many other contents are transferred to the client (downloaded) and these are "rippable" without much effort, anything: textures, primitives, and so on.

That's the reason why scripting is the most paied job on second life.

Depends on your perspective. When I have people telling me they can't afford 375L/wk for rent, or even 100L/wk, I think there is something wrong with the economy.

There is always a market for "luxury" space and "luxury" goods, but the question is, how big is it? For the "average" customer, however, I would tend to agree that the will to spend has taken a dip.

Personally I don't see a crash. What I do see is a demographic shift. I don't have any numbers or can't back this up except with my own personal experiences but I find that the majority of SL members are over 35 and many in their 50's. These older members tend to have more disposible income to spend on SL but....their spending habits are different. Landscaping, property, building tools seem to be higher on the priority list. So are things that they can to as an activity..for example horses, boats, etc..

People aren't staying in clubs as much, they are out making their own fun.

Wish I could remember the thread where I posted about the 'freebie nation.'

This isn't necessarily a downturn in the economy, but a growing trend among users who do not wish to (or who can't afford to) pay for anything. It's not SL economics, it's real world economies--with many people logging in from countries whose exchange rate with the US is disproportionately low.

I believe there is the same core population that spends very similarly to YAGO.
And I agree with everything Fand says above.

My investment: 72 USD/mo premium account, and I may have paid 25 USD/mo for a month or two for 4096m of mainland before I worked out some things. I can't remember. Garnet helped me for a while with land and I gave her a cut of profits during that time - I'm proud to say I made it worthwhile for her to do so.

I kicked in 500 USD as emergency buffer once about a year later, but then pulled it right back out - turned out I didn't need it. *Everything* else was made on the grid.

Cristalle is right though. Being early was (and is) a huge lead. That said, when I got started in 2005 most people thought the 'big boom' was over.

Just try telling anyone in late 2005 that there were going to be 10 million signups within 15 months. They would have laughed and called you insane.

It would be a lot like telling people *now* that 100 million will sign in soon, and that now is the time to get in.

So everyone had the same chance I did, if they were alive and had about 200 bucks to spare in 2005.

In fact, I bet we'll see people with rez days after today that make my little situation look tiny inside of two years. Never discount anybody - there's a lot of talent and opportunity out there. I remember what people thought of Desmond Shang as a noob. Believe me it wasn't much.

I agree that there is still plenty of room for those with a entrepreneurial spirit.

Maybe calling an economy "good" or "bad" is avoiding the more complex dynamics.

Its been pretty good for Land expansion.

Whereas many Content creators have run into hurdles. This is were less purchasing and texture ripping really comes in.

Its been good for those in the RL to SL entertainment business - Live performers (even the *cough* more radical ones)

Its been less good for the more traditional SL clubs, the competition has exploded -- Not that they ever really made money anyhow. Gambling is done, etc.

Well, in some cases, maybe. I fear that more often than not, a bad experience with an incompetent landlord causes some residents to shy away from renting from ANYONE. I'm seeing new landlords popping up everywhere I look, and even though most of them are competitors, I honestly wish them well and hope they know what they're doing- because their mistakes hurt the whole industry.

I have seen some painful questions being asked by new landlords on this forum who clearly do not know the market, the world or where they are in general.

Well that was definately alot of reading to cover, alot of opinions and ideas, I was merely poking a thread out on my lead theory. What prompted me to post this thread up was the results of an auction at a club that I attend regularly, The bods went down substantially from what I remembered and it clicked, With all thiese ideas I am going to overview the economy, analyze it slowly, And possiblly all of you may be correct, but in a way I see this as the world economy in a micro enviroment

I do encourage this conversation to contnue I will be making periodic posts and reading daily, If I can remember to >XD

But I believe all the factors that have been mentioned do have an effect in-world, but it would take a professional to see and deduce the problems, Yes some businesses have flourished, but also keep in mind that money is also taken out of world by those making a large enough of a profit, not infused back into the economy.

Not exactly true. We do shop from time to time. I don't consider myself having a "large" profit but it's enough that I can indulge on hair, live music and clothes periodically. A lot of us that are invested are invested in more ways than one - we are part of the community, and we don't make everything we consume. It's got to come from somewhere.

But that's exactly the issue. I know that in 2005 nobody could have predicted the huge boom that was coming up, that's true, and I know that there was a lot of pessimism about the future of the grid in 2005. But the other side of the coin was that, in 2005 you didn't have to compete with Caledon (or Armidi, or MystiTool, or..) In other words, the general feeling at that time was a lot more comfortable for people who might like to "try out" creating something and who maybe didn't care if the grid went down in 3 months because at least they got to try out. Now, there's a strong feeling that if you want to have a chance of succeeding at the highest levels, you need to be running strictly as a business right out of the gate, because your competitors are; and I think that puts a lot of people off.

In a market where these things already exist, I wouldn't say it's impossible for anyone new to succeed, but I would say it's going to require a LOT more work. It's also psychologically less likely - the environment is more discouraging, and it's not going to be so easy to find a "progressive achievement" structure - in other words, to start very small and work your way up. Because unless you're doing something really new and unique, when you're small, nobody will notice you, because there are giants now. And if you do want to do something new and unique, that's still risky because some people will trade off doing your new, unique thing against doing something that has many other people involved. It's tricky!

You would have literally hundreds of thousands of guys pushing memberships to Second life all over the web. Throw in escort or other adult traffic and its going to make money. Make money, more will follow no matter how bad it isin RL. unless everything totally falls apart. Sl can generate images like no other. Its an imagination based medium.
SL is cheaper than any other type of adult entertainment! My friend hates porn, yet constantly wants to roleplay with me. For me, I find it most interesting from a business standpoint. Denial yet complience.

Some really big ideas just popped up in my head, but it remains to the owners of SL to establish such a relationship. Hence I suspect the problem.

It comes down to perceptions. What does SL strive to be? What is it's desired IMAGE? It needs to decide a course and then stick to it. Second Life could be much bigger than it is. Question is do people WANT it bigger?
Perhaps there should be a SL university thats madated before your ever grantd access to inworld. to limit what you call noobs, what I call new customers.

Who's to say SL can't both embrace the adult affiliate model as well as offer an outlet for the Goddies to try to save us all. Imagine how that would spice things up, not to mention open up a whole new genre of revenue producing materials.

Hmmm.

I have NEVER seen one piece of outside RL advertising for SL anywhere, or if I did it was so bland I didnt notice. What got me interested to dive back after dabbling in the past was the CSI show. I suspect that alone was a huge shot in the arm for SL.
Im willing to pour hundreds, maybe thousands of dollars into SL because its FUN. SL needs people like me. More people willing to spend to have a good time. The most distasteful thing I've seen are campers. I understand the "why" but it just seems to make things look too manufactured. Row Dancers are a good example. theres no attraction there. it bogs down the system in that grid and doesn't do a thing for commerce really, sure it drive head counts. But who want to watch robots dance?

I'm fortunate. I have a disposible income at a time when many don't. I buy lindens. Im going to buy a lot more Lindens because I want to have fun. With the economy as it is and gas at a record high. SL is ripe for an influx of people looking to get away somewhere.

I buy from vendors. the 'get things cheap' route hurts everyone in the long run. has no one paid attention to the damages wreaked on the USA by sending all its work elsewhere? In Sl its all self contained. For the most part. Its a built in saftey factor for citizens.

I may only be a female, just about 30 in RL. I struggle, I work. But I'm from a very, very well to do family. Because they won't just hand it all out we have to work for it. Sure there's some resentment when we watch the life of Paris.

But I tell you it all comes down to this.

Its attitude.
As in anything.

I could be homeless under a bridge somewhere but I will still KNOW that I'm better, that I'm special and I'm far richer than the guy in the BMW worndering if his trophy wife is getting plugged by his pool boy while he frets away his life at the stop sign. I don't mean in money, I mean in inner resources.
I'm richer than the man with more money than god because he fails to see how to live and enjoy life.
The SL economy is a PLUS in todays world. market it as such. The real money will follow, I firmly believe that. U must dream big to be big. Its easy to say, poor me. That's a dead end.

Yes I'm a female, many have thought I was a guy all these years. I've never said otherwise. Its been my security blanket. Imagine their surprise if they truly knew. I'm twisted just like many others. I enjoy a good cyber.
I embrace it, do you?


C Spyker
Preggo Goddess
I make things happen.

It's one of the main issues with SL, really. There are a ton of people who come into SL and then quickly find that they are having a hard time making money in world. And they are reluctant to spend RL money on the "game", so they get bored and end up leaving. Some try their hand at escorting or dancing or something like that and get burned out with that while also not making that much money. More enterprising people will sit down and make up an investment plan, and purchase and flip properties or become landlords and make money that way -- but most folks who come into SL aren't looking to put in the planning, work and effort to run a small virtual business like that. So, although there are people in SL who make money in world in these various ways, we all know that the real pump of the economy is Linden purchases.

My wild ass guess is that the number of people who buy Lindens regularly as compared with the overall population is quite small, but it's this small number of people who are supporting the whole economy of SL.

I've finally gotten a spreadsheet working. I'm afraid this isn't going to be nice news:

Brazil in 2003 had a Gini coefficient of 0.61. The poorest 10% received only 0.7% of total income, while the richest 10% received more than 50%.

Counting ONLY those residents who actually earn something in SL (trying to include the non-earning residents gives a nonsense figure because you start counting bots and people who stopped at OI)..

Second Life in 2008 has a Gini coefficient of 0.96. The poorest 50% receive only 0.87% of total income. The richest 10% receive 80% of total income.

If Philip still thought he was running a country, it certainly became a plutocracy Of course, comparing SL to a real country isn't very fair because SL residents don't have to earn in order to buy food. But more seriously, this kind of division is driving the loss of "immersion" in Second Life. The rich don't want to immerse because they have nothing to do with their money but take it out of the economy. The poor don't want to immerse because who really wants to immerse in a world where their economic position will be worse than a Brazilian farmer's?

(And yes, I know that they can still afford luxury clothes, vehicles, etc. in Second Life even at that "poor" of income, but unfortunately, human happiness/satisfaction tends to adjust ("hedonic adjustment" for that kind of thing.)