Economy Stats

Hi,

I looked at the economy stats page:
http://secondlife.com/whatis/economy_stats.php

There is a table how many users earn US$ (positive balans).

What does this mean ?


Are in these numbers the tiers also included ?

As a private estate owner I pay over 5 000us$ on tier per month to Linden Labs.
Does that mean that i'm one of those 218 people having a PMLF of over 5000US$ per month ?

No, which is why I don't pay much heed to that stat.

Sorry, what do you mean by tiers included? If you mean other people paying tier to you then yes, but those figures will include people making a loss as they don't account for the tier you pay to Linden Lab.

You are paying LL $5k per month US? Uhm- ok....

I mean the tier I pay to linden labs for the sims i sell/rent to my customers.
I receive more tiers from my customers then i pay to the lindens.

It doesn't include any payments you make to Linden Lab.

Does that mean when i receive from my customers 5001US$ per month and i pay to the lindens 5000US$ tier for my sims that i am one of these 218 people ?
Even with 1 us$ net profit ??

PS: I'm making more then 1US$ profit, lol; just a question

I believe so yes, indeed if your customers paid you 5001US$ per month and your tier was $5100 you'd count as one of those 218, it's the Linden dollar balance profit margin that counts.

Maybe someone will correct me if I'm wrong but as exchanges don't count, I don't think they deduct anything for you selling your Linden dollars.

It is correct to say that if you make 5001 USD and pay 5000 USD to LL you are counted in the top earners, no matter what your profit margin is, it just looks better for numbers.

If that's right, it's very interesting, because it means that the numbers are useless. I'd always thought that the US$ numbers were profits, but I'd never given it a thought.

Well I could be wrong Phil, it's happened before. I just assume that when they say these figures don't take into account Linden Lab charges that tier fees don't count. I hope by Linden Lab charges that they don't mean classifieds and show in search places too.

I'm not sure about the selling of Linden dollars, if they count that as an outgoing cost then the figures would serve more purpose.

I never realized that's how the calculation works. huh, suddenly throws things in a whole new light

That's a thought. Most people will probably sell L$ for their tier, so that should be taken into account, and probably is.

I think this is how it works:

positive monthly flow = all lindens you receive - all lindens you spend/sell;

I could be wrong but then those stats look terrible.

So the answer to the OP's question is, subtract your L$ receipts from your L$ sales (and spends) and that's the bracket you are in. So if you receive the L$ equivalent of US$5100 from tenants and sell enough to pay your US$5000 tier each month, then you'd be in the L$ equivalent of US$100 bracket. There is the selling fee to remove and anything you spend to remove, of course.

Well the Linden Lab charges that don't apply have to be taken into account, I'm not sure what they mean by that.

The stats are of course a little misleading as any payments made by paypal aren't included.

On the other hand, if I buy $1000 worth of mainland and sell it for $6,000 (maybe I do, maybe I don't <G> then I do not appear on this list.

One thing that this thread made me realise is that there are only 218 estate owners with gross income more than $5000 which seems like a very small number. It's about 16 sims if you make no profit, 13 sims if you make a semi reasonable profit.

Not all of them will be landlords though.

Seriously, does anyone know how this works? I'd have a better concept of this stat if I knew what did and didn't count. I know exchanges don't count.

Where's Desmond when you need him?

I dunno, I think it's pretty clear how it works. The description quoted at the top of the thread about as clear as possible.

This seems to be the most logical explaination. My understanding of "positively monthly linden flow" is that it's a formula deducting sales of Lindens from purchases of Lindens. It's a bit like cashflow generated from working capital....the difference between receipts and payments, will either give you positive or negative net cashflow for that period.

positive monthly flow = all lindens you receive - all lindens you spend/sell - all the lindens that LL takes from you (fees for showing land in search, group fees)

Well not really as it says that Linden charges don't apply. If they're talking classifieds then the stat isn't worth that much. If they're not counting sales of Linden dollars then the stat is even more worthless.

Actually thinking about it I doubt they do count Linden dollar sales because a profitable business would have enough to sell Linden dollars, pay tier and have some left over to cash out. This figure can only make sense if it's based purely on inworld flow.

The way I read it, that is saying there are 218 people who make a PROFIT of $5000 USD or more in a given month, before any charges that LL themselves makes for mainland tier or other LL fees are added in to the calculation. So yeah, if your L$ balance in-world plus your USD balance showed a net increase of $5001 USD, before LL charged you $5000 USD in tier, then you are one of the 218 who "Made more than $5000 USD last month". Even though your ACTUAL profit was only a buck.

But beyond that top 218, there are another 396 who had a profit between 2000 and 5000, another 585 with a profit between $1000 and $2000, another 973 with a profit between $500 and $1000, etc. , and a total of 60,788 who had SOME sort of profit in August. (before LL fees and tier).

Reduce that number by those people who paid tier and fees to LL in excess of what their profits were, and you have those who actually made a profit that they can cash out.

So if you are paying LL $5000 USD per month in tier, and if your in-world income, say, from rental termanals that your tenants pay you through, was enough L$ that it was at least $5001 USD worth of cashable assets, then you are one of the people who REALLY made at least a buck last month.

But the 60,000+ figure also includes those with a net loss after paying their tier... so for example if we assumed that all of the 32,876 people who earned $10 USD or less also paid LL at least $10 USD that month in tier, then even though they are counted as having a PMLF, they actually lost money that month.

I personally favor treating the in-world transactions as a black box. Doesn't matter if someone in-world paid you a million L$ and you blew it all on clothes. If none of it ever reached your USD Balance as funds being cashed out or applied to tier, it isnt yet a "profit". What should count is what was your USD balance, adding as income any L$ sold on Lindex, and subtracting as expenses any LL tier or fees paid from the USD balance. If you actually cashed out some of your USD balance to PayPal and could bank it, or if there was a net increase in your USD balance that you *could* cash out, then you had a positive income for the month. LL should report that, instead.

Yet none of this counts what happens outside of LL's control. Any merchant or landlord who accepts direct payments via PayPal or other external means can't be counted in this. No way for LL to track that.

Also, L$ purchased on SLX or other exchanges are no different than L$ paid to you in-world for merchandise, as far as LL's figures are concerned. Yet the 12K L$ that a merchant received from customers because they were selling dresses is certainly a profit, where the L$12K that someone else purchased on SLX is an expense... But all LL sees is that in both cases, your L$ balance incresaed by L$12K. And if you sell L$12K on SLX, you actually made a profit, but LL's figures see that as your L$ balance DECREASING by L$12K.

Also remember that the sim owner / landlord business isn't the only way to earn money in SL. There are a LOT of merchants and content creators who don't own a single square Meter of land, and who pay no fees at all directly to Linden Lab. They will still show an increase in income for any L$ paid to them in-world, for merchandise or services. They will show a decrease in L$ if they pay their store rental fees or rented sim space in-world in L$. But LL can't track any land rental fees paid directly to the landlord via PayPal, or any payments for goods or services paid to the merchant externally (PayPal again), or increases in merchant account balances on SLX or other merchant websites.

The only accurate measure of monthly profit is the one that only an individual Player can calculate: Expenses are what they actually pay INTO SL in some way, in terms of LL fees, L$ purchased on SLX, Lindex, or elsewhwere and land fees paid to sim owners or rental properties or mall space rentals..., Profits are what they actually did cash out, or fees paid to them externally (via PayPal or check), or increase their USD balance that they COULD cash out of they wanted to.

Originally Posted by Elanthius Flagstaff
One thing that this thread made me realise is that there are only 218 estate owners with gross income more than $5000 which seems like a very small number. It's about 16 sims if you make no profit, 13 sims if you make a semi reasonable profit.


I was actually doing stuff for my RL corporation today trying to expand the business a little bit - scary, huh? Yeah, busy life here sometimes

Ceera pretty much summed up what the economic stat meant.

17 private regions will happily soak down 5000 USD/month, no problem. So it may look good in the economic stat, but imagine "breaking even" while working 20 hours a week or more, if occupancy isn't really good.

This is the part most people leave out - the prestige and the cool factor of having a mini-continent isn't worth 1/3 to 1/2 of your real world work hours, unless you are doing quite well.

* * * * *

Content creators don't have it so easy, either.

Sure, you get *massive* returns with no overhead and this draws a lot of people. If you make a house that you can sell for $L 5000, sell one a day and that's $L 1.83 million or about 6700 USD annually. Imagine 10 houses like this, that's 67,000 USD a year!

Except for one problem. Content creators are 'hot' and 'noticed' only while they are creating, unless you are a real superstar literally defining your industry. Quit making new stuff, get out of the public eye, and business falls off *fast*. Especially the moment someone else notices your market niche and goes for it.

So it's a weird twist of being high profile but trying to make sure you don't look like you are doing too well at the same time, or you'll draw competition like flies.

I think the number of landlords is far less, or not properly represented because some take paypal. Think of how many big name places (animators, elite skin shops, high fashion places) make a living off SL. The people who are the biggest names in SL, the ones who can afford to spend hundreds of thousands of L per week on classifieds. Throw those into that pool.