How Much Money Will they losse from you?

I though maybe the cold hard numbers may make LL listen. Money does seem to be there main concern.. not customers. So if the go forward with the OS sims as announced.. how much will they loose from you?

They will loose at least $1200 a month from me in OS tier fees. The remainder of my tier.. a lot depends on there handling of the OS Sims

Not one cent.

They will lose US$875 from me per month. I've already abandoned two regions to maximise my savings and minimise what goes into their pocket.

And on THAT note, my support ticket (titled "Abandon Openspace" was read and acted on within a couple of hours. I was expecting to have to wait a few days for it to be read, but they did it right away.

Actually the paranoic side of me thinks that might suggest they are about to U-turn and offer compensation. The sooner they can delete regions (before announcing any compensation), the less they have to compensate.

On balance, I strongly suspect that LL will not lose any money out of this, plus they will have a better performing overall environment for the many tens and hundreds of thousands of people that do not own OSRs, and have every right to expect a sustainable level of service.

If you sell your OSRs, then the tier will be paid by the new buyer. If you abandon your OSRs then they will just be converted into full private regions, at a flick of a switch (pretty much), and sold as new to someone upgrading from an OSR to a full private sim.

I would not worry about that as there is no reasonable cause for LL to offer any form of compensation. LL are perfectly within their rights to change their charging rates, they are not regulated or capped in any way on pricing matters, and it is a private company.

My guess is they will lose money in the short term, probably several tens of thousands of dollars over the first quarter of 2009, unless all those announcing they're abandoning sims are just mouthing off, and I don't think they are.

But with possibly several hundred fewer servers to run and maintain, there are staff and equipment savings, and as you say they can reuse all those servers for private islands or mainland. Another huge release of mainland coming perhaps?

But I suspect that the abandonments have been factored in to the decision, in fact if it really is load on the network that's the problem, cutting the number of OSs might be all they need to solve their problem. My guess is that getting people to give up many of the OSs is part of the plan.

Of course, Rudolph. But that isn't good for public relations and reputation. They screwed up, they should fix it.

You could be right, but I would suggest that the two months lead-in will soften the (really very minimal) blow (if any at all) if OSRs are abandoned.

But I would also suggest that a quad core 16 way rack server, when bought in bulk, costs about $1000 USD to buy, set-up, and integrate into the network. If such a rack has 16 active OSRs on it, then LL have already had $4000 USD as "purchase" income and $1200 USD per month in tier, per rack. If we assume that each rack has only been leased out for an incredibly low two months, then they could sit idle, and I mean completely idle, with no revenue at all for three or four months, with zero impact on the baseline.

But they will not sit idle. Abandoned OSRs will be resold. If the racks are resold as OSRs then they will fetch a further $6000 USD plus $2000 USD per month. But let's assume that the outcry is such that there is NO OSR market at all in the future. No problem, abandoned OSRs will be sold as full sims, fetching a further $4000 USD on sale (per rack) plus about $1200 USD per month (per rack). I suspect that the demand for these full sims will easily outstrip abandonments and that LL will not lose out at all. But let's say I am wrong for a second...

All LL need to do, in a pretty bad scenario, is not buy anymore racks for a few months. In the absolute worst case all they need to do is not buy anymore racks for a few months, and retask any spare racks to the mainland, which will no doubt see increased demand, and sell the sims for $2000 USD apiece ($8000 USD per rack) and get $195 USD per month (as a minimum) in tier ($800 USD per rack). If people actually take the step of abandoning OSRs in huge numbers and abandon the idea of owning land in huge numbers, then those spare racks can simply be used to replace any remaining Class 4s hanging around, all of which would have been planned for anyway.

We're not even into contingency territory yet, nowhere near. If it really came down to it, LL could sell off their spare racks on the open market for hardware at $200 apiece, and still be in profit.

It won't happen though. LL can always reverse or amend their decision on OSRs, although this will be at the expense of all those people that do not own OSRs.

Compared to the business risk that was posed by allowing Ageplay and illegal gambling, the risk posed by changing tier rates on OSRs is, at most, a second order issue.

LL did not screw up at all. They even gave a huge amount of notice on their intended policy change.

95 per cent of residents (perhaps more) will not even be aware of the policy change, and those 95 per cent are the ones who stand to benefit from the performance increase, or at least, sustainability.

Well Nina they’ll lose a little money, around 150 - 250 US$/month, depending on whether you calculate by the existing rate or the announced.

I don't think LL shall be really financially hurt, whatever the outcome of this may be - which is fine with me, I'm not out to hurt SL; on the contrary, I want the best for our world!

What LL shall really loose - and all you hard-shelled people, who se nothing but money in this situation, will probably not understand or agree - is that the 'labour of love' - that the small community I and my residents on 3 sims (2 opens-paces) next to each other has build - will be shattered and that many peoples existence in Second Life will be tainted by this.
Furthermore the confidence I - and a lot of other people it seems - may have had in LL and its management is lost, or seriously diminished and there is a lot of disappointment, anger and frustration out there.

A lot of people will be homeless in SL and will have to move to the mainland - the mainland that a lot of us detest and don't really want to live on!
So, some decide to quit and check out other options, that may not yet be really viable compared to SL; but the influx of new residents, coming from SL, will help and eventually there will be real alternatives. At least that is my guess.

So, what LL will really lose is intangible - its 'hearts and minds!
And don't tell me 'hearts and minds' are not important - wars have been lost because 'hearts and minds' could not be gained - it is a factor that will influence business too.

They won't 'lose' a single cent! As we have paid for our sims and are now being forced to abandon them, they have made a wonderful, easy, perfectly synchronised HUGE PROFIT! for doing what? Not much! Even if they change their minds now, it is too late for most.

I'm sure the $500 per month tier and the loss of revenue from my contribution to this world won't affect them in one little tiny way. Small fish - big pond.

So well put and just to add trust and respect from a lot of people although the LL apologists no doubt will disagree

In the longer term I think you're right, they will be able to reuse the hardware and sell the land as "new" all over again, I just think they're going to lose a fair bit of revenue over the next few months. Apart from replacing the remaining Class 4s I doubt if they'll be able to put the abandoned servers to use for a while. I don't think they'll find there's a big market for OSs at the new price, there's already loads of dirt cheap mainland, and the set up cost of private islands is prohibitive to many people. So I think they may be sitting on a pile of hardware for a while, but in time it will all get reused.

It's not _that_ huge. They bill by the month and they pinned it right after the biggest holiday season of the year.

I think they didn't manage it as well as they could have. Much of the customer reaction we've seen this week could have been avoided..

As for if they're going to lose money or not, I think they've added a lot of uncertainty to the SL land market, especially around private estates. They'd be very short sighted to think that the corporate cash they've been trying to lure in won't notice this.