Do you think SL can survive the RL market?

I'm curious what people's thoughts are on how long LL can hang in there in the current and/or potentially worsening of the RL financial situation. I pose this question purely in a financial perspective. Can they ride this out?

They could thrive with SL...if they know what they are doing.

There is no "Mayne" option so I didn't voye.

Of course they can. I've been quite surprised to see my sales jump significantly over the past two weeks. $20 may not buy much in RL, but in SL, you can do some serious shopping with $20

I agree with Brenda. IF they know what they're doing, SL will thrive. The internet will be one of the cheapest forms of entertainment in a failing economy and more people are apt to stay home and virtually entertain themselves. A year of premium SL is less expensive than a good steak dinner with a couple of drinks. They'll be ok.

On a side note - by IF they know what they're doing, it would be in LL's best interest not to super impose any new clients that require people to upgrade their pc's. If they do that, they're sunk cause most people won't be running out to buy new computers.

Cheap, escapist entertainment is always popular in recessions / depressions.

That and booze... I doubt liquor stores are hurting.

Assuming Linden Lab itself is financially stable, I don't think Second Life is at risk. However, the SL internal economy might take a battering.

I've been looking around at land recently. I've visited some of the cheapest flat-green-mature 512 parcels, and some of them have been for sale for several days!

I even bought one and resold it a few minutes later for a profit .....of ....wait for it.......L$50 !

Why do all my posts end up talking about myself?

I posed a similar question a few days ago and the response was quite positive. I think this may be in part due to the fact that the responders tended not to sound panicked or overly concerned with the global economic problems. Perhaps we do not represent the majority of the population "out there" in the world and are more individualistic than we give ourselves credit for. We don't appear to be lemmings headed for the nearest cliff and we recognize that what goes down will, inevitably, come back up. I think even sl recognizes that as it observes its population. We rarely "bail out" and I think, deep down, all of us who come here are essentially optimists.
The SL world will survive. The real world will survive. I may not have been old enough to have really understood down trends in markets back in 2001, but I am not selling coz it looks to me like it gets back in a groove in time.

I suspect they can do quite well, actually. Yes, there may be issues with people not wanting a major outlay, but in a bad economy, people can an will want some excape.

There's a reason why "We're In The Money" from Gold Diggers 1933 was a huge hit in the middle of the Great Depression.

Maaaan, where did I pull up that trivia?

You may be right, but it also may be more of a case that most SL users are maybe a bit more financially secure than the average working stiff, who doesn't spend what little free time he has sitting at a computer playing games. SL is still a niche product, and those in that niche generally are a bit more financially stable. We may cut back a bit, but we'll still be here. The people really taking the beating, wouldn't be in SL in the first place.

There are exceptions, I know a lot of students are in SL..or at least doing studies on SL, and disabled people who are fixed on incomes, but generally that's the idea.

I still firmly believe LL's mangement or lack thereof of the product is it's biggest potential downfall.

I have no opinion as to whether Linden Labs can survive the current economic crisis, but early indications are that the in world economy is doing just fine. In fact in the first 2 weeks of sept I have seen my highest sales of this year so far and I know of other residents who are experiencing the same boom . I think people will be more inclined to spend $10 in SL than $100 on a night out in RL. I think we will be just fine as long as LL can keep their company afloat.

L$ = Micropayments... 'nuff said. =^-^=

I agree with you. I think we do - generally - have that advantage. I know we are both careful about what we are saying here (I am sure someone will post "Oi! I'm NOT in your demographic!" but I think, for the most part, we are professionals or self-employed (of one sort or another), we recognize that we must remain sensible in economic down-times, and we are generally sensitive to real issues and concerns. SL becomes a cafe or a nice urban centre for us to meet in - things will work out.
By the way, do you realize that for once in a thread everyone appears to be on the same wave-length.

SL (and other virtual words) will survive and flourish as the economy falters in the same way that the movie palaces and Hollywood flourished during the depression of the 1930s. The over-the-top movie theaters enveloped the patrons with a lush escape from the darkness of that time even before the first reel flashed on the screen.

People need a cheap escape and the Internet, and virtual entertainment, is one very satisfying way of finding that escape. As Imnotgoing Sideways stated so succinctly, SL has figured out how to make micropayments work, where earlier forms of Internet entertainment could not.

The added benefit of SL is the experiential nature of it. Residents looking for an escape from their stressed RL worlds can experience being another persona or acquiring things that they cannot afford in RL, not just live vicariously through the movies or by watching TV. As any resident with a few lindens in their pocket can tell you, there is something deliciously satisfying about shopping for new virtual shoes.

Internet access is much cheaper than cable TV (in the US, at least). You do need a decent computer to use SL but it won't cost you any more than a big HDTV will set you back. It will be interesting to see if more and more people choose interactive entertainment such as SL (and video gaming, another market destined to do well during a downturn) instead of passive entertainment such as TV.

The only serious concern I would have would be in regard to the current credit crisis.

As an international company, it makes sense to use reasonable amounts of debt during normal times as a mechanism to accomplish goals. For example, borrowing a million to get new hardware so you can make two million, stuff like that. A company sitting on pure cash with no debts is usually overcapitalised and prone for marketshare loss.

So the question we won't know the answer to, is where they do their banking and how accessible their credit lines are right now.

My guess is that they are probably okay. When you have angel investors like Mitch and Pierre, you probably not only have emergency capital available but also some crisis pre-planning. Venture capitalists generally have an idea about how far they are willing to go to make something work (that's kind of the point of venture capitalism).

Though I'd be amazed if some of the major financial players didn't get hurt, and baaaadly during the current crisis.

* * * * *

I was joking with a friend of mine last night, but it was oddly appropriate.

Had I stayed in my professional field (electrical engineering) and done the right things, e.g. invested in 401k's, stocks and bonds, the safer investment funds... I'd be in real trouble right now.

As it is, I quit my job in 2001, started a small RL company and eventually got fake land in a video game as a hobby. Right now the 'video game' alone makes more than the average United States household.

I have a few professional friends that thought I was stark raving mad. Looking back, it turns out that dying in a corporate cubicle, working tirelessly to make someone else rich was the more foolish option.

Irony can be quite ironic, can't it?

LL is hiring ~70 people. I think they are not too worried.
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Exactly what I was going to say Sales in SL may very well increase.

Actually, entertainment tends to do well in economic downturns. During the Depression, movie theaters saw a boom in business from people trying to escape reality for a couple of hours.

Second Life will probably experience the same sort of thing. People will dump most things, but usually not their internet connection, and it really doesn't cost anything to wander in this game and talk to people.

And as someone else pointed out, Twenty Bucks goes a long way in Second Life if you do decide to spend money on it.

In SL you can buy or rent the castle and furnish it and have more shoes than you know what to do with, all on the cheap or for a bit of camping....

stay-at-home escapeism yayyyyy

However as mentioned above the latest imposed download gave my spare inferior laptop the jitters and a smacked wrist note from Linden as to how it was now unable to run sl properly...but it will still sit my alt on a poseball which is all i need really...

/me votes No Worries but with the caveat that I think it'll hurt LL's premium count (more than it's been hurting already) and at least mainland tier as people start looking closer at their recurring expenses...

This is the first time I have ever seen a 100% result on a poll. We are confident aren't we!!

I also agree that cheap entertainment can do well in a slower economy, to an extent. But, when milk and eggs money starts competing with SL fun money then We all have a problems. With any luck it wont get that bad. *prays*

I abstained. I'm in the "maybe" camp.

This is an extremely good point.

And I'm speaking as someone lucky enough to have recently gotten a new and powerful computer. But when you have a new and powerful computer----as presumably most of the Linden personnel do----it's really easy to forget that most peope DON'T have new-and-powerful computers. And as you say, in the current climate, people are much less likely to be able to buy them.

So LL would do very well to keep that in mind.

This is NOT the right time to make SL less older-computer-friendly.