Sound Commercial Footing Before Expansion

There is a fundamental issue confronting Neualtenburg at this time. I feel Claude has pointed at it in this thread:

/103/65/80112/1.html

and it demands a great deal more consideration before we run "hog-wild" into buying new sims. Here's what he posited in that thread:



Neualtenburg was founded as a concept of self-government, nestled in the temporary bosom of good feeling provided by LL in Anzere. As was inevitable, the breast was withdrawn, and this profoundly interesting and challenging concept of political organization was cast out to fend for itself commercially. The island sim was bought quite literally on a prayer (loans from a few participants) in a mood of challenged survival. Grasping at straws, we devised a way to form a self-sustaining "place" where that political experiment might be carried on. A competitive model of land sales, much like that used on many another private sim, was devised, such that new residents might be attracted to the sim for its good prices and attractive visual environment. Oh... and, by the way... they became participants in the political experiment, wittingly or unwittingly. The underlying point was...*Survive*...

But... That is NOT the point of Neualtenburg! Others will accomplish the job of creating and marketing the attractive themed sim far better than we. The Disneyland strategy holds no future for us; ultimately it is a yawn... and those who move here because of it will soon leave. The purpose of forming the themed sim was to foster a self-sustaining environment where a profoundly innovative political/social/commercial experiment could take place. If we lose sight of this, we have lost the point of the enterprise. Better to convey the sim to Anshe under a contractual marketing arrangement... we will be far more successful.

Now that the City budget is balanced, at least temporarily, it is imperative that we establish the fundamental parameters on which a social culture exists. I suggest that basically, peoples' relationships are economically based. A citizen of a mature Neualtenburg, in full possession of their senses, participates through a perception of self-interest; that their presence here benefits them economically. For sure... that could take many forms, for one's "economics" are perceived to relate to one's "well-being", one's "quality of life"; many of the things that people feel life is "worth living for".

But in an open, intelligent, principle-based society like the one we propose to form, economics underlie most of these values. Please forgive me for dragging in the ancient Greeks yet again (I'll plead genetic bias ). In ancient Athens during the pressure-cooker time in which the concepts of democracy were assembled, it was economic self-interest which drove the process. The traditional top-down aristocrat power-base found itself unable to achieve its goals without getting the support of small land-owners throughout the region; and they appealed to that base through the mechanisms of economic self-interest.

Neualtenburg has no such basis, and it must develop one if it is to evolve into anything other than a themed residential sim. The elaborate government structures are a sham without a complex of economic realtionships to inter-relate. The beautiful new Rathaus is a pretty jangle unless the City transforms itself into serious economic entity.

A major step happened in the last few days when Kendra replaced the buildings on the south side of the Platz with stores, ready for merchants to set-up shop. The contrast between this open, available and inviting place for plain business; and the other side of the Platz with its pretty but empty stores, still owned by the City and quite unavailable to the individual entrepenour; the contrast could not be greater. Those new shops need to be rented or sold. Everything we do now at this phase of NBurg development should be focussed on creating a thriving business environment.

I propose that any plans to expand to additional sims be postponed until we have shown that we are not, indeed, a pretty themed sim, but rather a "marketplace" of competing ideas. As I mentioned in that thread that Claude started, I'll be trying to present a proposal to this effect shortly.


Sudane

I agree with much of this, but......

Just as Neualtenburg must be more than a pretty themed sim, it must be more than a nice place for a store. What makes us unique is the political, and to a lesser extent, social side of the ledger.

It has been suggested that most SL residents are at heart, libertarians and individualists. Even so, the fact that Naualtenburg exists is testament that not everyone is. We need to target those residents of SL who want to be part of a community and government. Sudane said



What we need to do is seek out those who want to be participants in the political experiment. I believe, optimistically, that there are enough of them to make Neualtenburg politically healthy. However nascent our political system is, it is our greatest strenth.

This is not to say that economics don't matter. I'm most interested in economics to answer the question, "How can the city generate enough revenue to compensate fairly those who create public works and spaces?" To the extent we can create a healthy economy on the sim, so much the better.

I appreciate Sudane's caution on expansion. On the other hand, even with the changeover on the south of the platz, attractive commercial plots within the walls are quite limited. Expansion might allow us to be much more intentional about creating commerce-friendly space.

Finally, I hope someone will put forward an economic proposal that expands the economic base. What I mean here is that almost all discussion about economics in SL is about, "How do I get people to buy objects I make, textures I create, or scripts I write?" For Neualtenburg, and by extension SL itself, to thrive, commercial success must be a possiblility for those who do not build, texture, or script. I'm not saying I know how to do it. At the moment, objects(especially clothes) and textures seem the only thing for which people are willing to pay, but you cannot build a healthy economy on three or four job titles. I'd like to see us take the lead in growing the service sector.

Yes! Which, together with the economic side, are inter-related.
This is the heart of the matter. It is absolutely true that we will not take the form of a thriving, high traffic mall like L'Cadre (whatever its called...) where money is handed out for free, and people hang out on the roof to collect. That's not an organic development for an economic and intellectual entity like NBurg. A service sector orientation, as well as a source of high quality, unique, or innovative objects, are possible directions to explore that might create an identity stamp for Neualtenburg.

At Kendra's urging, I'm in the process of opening a shop next door to the church. The goods for sale are primarily services... my landscaping design and custom building creation. Of course, these services could probably be satisfactorily offered without any "brick-and-mortar" presence. But, the opportunity to create a context for the services, present a visual accountrement (much like the paradigm "well-appointed law office", lends more depth to the nature of the services presented (hopefully ). The client has the chance to interact in a 3 dimensional space with the "product" offerings. And, last but not least, the client is visiting Neualtenburg to do so, lending whatever cachet that provides.

I mention this only as an example. We have discussed banking services, university programs... Flyingroc is attempting to establish an investment services company. This is exactly the area where we must brainstorm to "push the envelope" of what NBurg can become.


Sudane

Neualtenburg is not a mall. I repeat, Neualtenburg is not a mall.

We must proceed with commercialization carefully, making sure we balance asthetics with accessibility. I've seen no discussion about the recent changes in the forum, so I assume the OK given by the RA to major changes was passed a while ago and posted in a transcript I didn't read carefully enough. I want to make sure the N'burg avoids the cluttered mall look of other themed builds (some looking like garage sales) and maintains a close analogy to the medieval city on which it's based.

It is also very important to note that internal commerce will always be dwarfed (by one to two orders of magnitude) by the income we receive from land-use fees. If all revenue from sales went directly to the city we would be bringing in a factor of 1 to 0.1 that of the monthly sim fee (US$195). If revenue comes from a 10% tax (as it currently does), the factor will be a dismal 0.1 to 0.01. The current factor for December is 0.008! How much financial gain will converting N'burg to mall for greater SL bring us?

More importantly, why is must our existence be defined by our ability to sell goods to greater SL?


If you read this page, you'll set that:


Our primary benefit over external sources of land is that we provide it cheaply, we enable true ownership, and we provide a well-defined mechanism for conflict resolution. Those are our differentiators. Becoming Le Cadré II is not.

Because this entire project revolves around brining individuals together to share a common space (and hardware), if we want the project to grow we must expand our sims. People are our greatest asset not L$.

~Ulrika~

It doesn't. The point of the commercial builds set up on South Platz has more to do with creating an environment that attracts artisans to Neualtenburg.

One cannot have a thriving Artist's Guild that provides beautification and infrastructure to the City if those artisans don't have an attractive method of turning a private buck or two.

The model as set is based more on the merchant success of "Altenburg" and not on a mall.
Believe me, if Altenburg had not been feeding me as well as it has these last few months --I'd not have been quite so enterprising or generous with my public building.

That's a great point! We could always use more artisans.

I see your point. It's hard to do lots of work for N'burg without seeing some kind of return. Providing individuals with a way to make revenue as incentive for supporting the city could be successful indeed. Are there any plans to compensate artisans for past, current, or future work now that we have a budget? I've always wanted to see a little green for the initial sim set up as well as the creation and maintenance of the website.

~Ulrika~

I don't think anyone wants to do that, Ulrika. Certainly, not I.



So far as the changes to the Platz, the builds remain Bavarian in theme (just a different, more open design for the ground floor) and while this WAS discussed in the RA, I believe the general Guild allowance of improving city land might apply there.

Als I've commented before, Neualtenburg is trying to do too many things. You have the private sim factor, the "themed Bavarian city" factor, and the political experiment factor. One reason for Neualtenburg's slow growth is the set of people to whom all three things might appeal is quite small; the set of people who can tolerate one of those things and like the others is somewhat larger, but not huge by any means.

In my view, the political/economic aspects of Neualtenburg are of far greater importance than "theme". Which - before anyone gets annoyed - is not the same thing as saying we should not have themes, or allow themes, etc - the city as-is is a nice draw.

However, the city's layout is "not so good" for the purposes of a virtual world; it mimics without consideration for the different environment. There's nothing wrong with this for aesthetic purposes... but at the same time, why should I be forced to live in a medieval Bavarian house just 'cause I want to experiment with sim-democracy? (One reason my plot is outside the walls.)

This is why I have suggested (as an experiment in itself) a second sim remain themeless. Not covenant-less, mind you; I fully support zoning it into "commercial" and "residential", with building standards somewhat similar to the ones currently used for the NW district. By applying the Neualtenburg political principles to sim with artistic allowance similar to the main grid (though restricted to prevent abuse), we can get meaningful data on how well the political model by itself functions, and perhaps even get a few citizens to boot.

EDIT: Just in the interests of full disclosure, I'm also behind this because... well, my shop and home in SL is a green stone-and-crystal island that floats roughly 10m off the ground, seemingly supported by circles of mystical runes; very "technomagical". I'd really love to make Neualtenburg my home, and not just a place I run events in... but I'm not doing it until I can move my place in legally, dammit.

Any area in the Neualtenburg Sim zoned for both modern and medieval simultaneously would house such a structure without bending any covenant rules.

just sayin'

Perhaps I take the precept of "no free floating structures" too seriously, then. Even so, I'm still left with the inability to be a store, which is what it is. Hence me waiting for commercial area that doesn't restrict me to the in-town rules.

I absolutely agree with this. However, don't think the City is going away anytime soon. Instead, we should deemphasize it by expanding the number of sims we have, zoning each in a different fashion.

As you have suggested, I think a sim with a simple themeless covenant aligned on a grid would be appropriate. We could dispense with the organic layout of the N'burg sim and do a grid without roads (except those needed for continuity with N'burg). You'd then have a slightly tamed version of the grid/sprawl of SL that would attract a wider base alongside the sparse/dense curvilinear Bavarian build. We would then modify zoning laws to slightly allow one style to spill over into the other so themes aren't relegated to single sims.

~Ulrika~

Outside of the city walls, I believe you're allowed to sell whatever you want however you want (provided it's not RL commercial pornography).

~Ulrika~

all "b" and "m" zoned lots are residential-use only. Which, to me, would seem to say "no vendors".

Also, I'm close to the 4k land-owning limit.

'course, if I'm either (a) mistaken as to the definition of "residential" or (b) I'm not, but we can blow through some legislation overcoming both of those after elections, I'll move in the day after.

Unfortunately not. The law which was passed is the following:
As can be seen at the bottom, The goal is to protect existing structures with aesthetic or historical value from modifications without consulting with the citizens.

~Ulrika~

I think that should change. How do you feel about it? If you'd like, we can vote on it next RA meeting.

~Ulrika~

Obviously, I'm all for it out of selfish reasons, though at the same time, I figure having most of the commercial activity "concentrated" in the city could be/could have been useful.

But on the other hand, nothing wrong with experimenting, eh?

I'm all for supporting the needs of the constituents. If the people want to be able to sell from their homes, then by golly we should take it to the RA. The same goes for getting you an exception to or changing the no-floating line in the covenant.

~Ulrika~

After a few hours of thought, I finally figured out what troubled me about Sudane's original title. The cautious side of me likes the idea of being on a 'sound commercial footing', but I don't know what she means by the term. It could mean any of the following or a combination of them:

The sim has a certain number of commercial entities.
The sim generates a certain volume of transactions.
The city realizes a certain amount of sales tax revenue .
A certain percentage of city revenue comes from sources other than land fees.
The city equity reaches a certain point.
City net income reaches a certain level.

Any of these could also be combined with the requirement that the condition be maintained for a length of time.

Sudane, could you clarify what criteria you would use to determine whether Neualtenburg is on a sound commercial footing?

Sure, I'd love to. The following is exactly what I *don't* mean:



There is no question that the "city structure" itself is on a sound financial footing. There is no question that that "footing" is and will continue to be land fees paid into the city treasury by residents. At the moment, the City has enough money to pay its bills, and then some.

The question is: what is the motivation which will draw individuals to want to live here and pay such fees, especially as we (a) expand into several more sims, multiplying our monthly overhead, and (b) increasingly migrate away from strict adherence to the pretty visual experience that was such an urgent priority in the past. It appears that the choices are three:

1) It's a pretty sim. You feel like you're in a real medieval bavarian place when you're here. We re-energize the building part of our covenants, develop new and equally intriguing themes for the other sims, and pray that Anshe doesn't beat us at our own game. This is boring.

2) Count on the fact that an interesting philosophical and possibly scientific discussion/ exchange of ideas is going on in Neualtenburg, and that this discussion is so interesting that others will flock to the city to participate. Sorry, but this is not even the case now. Few of the residents of Neualtenburg are inclined to participate in this. Even now, 3 days before the start of an election, we have perhaps half of the residents even signed up in a faction, much less contributing to this discussion.

3) Form an environment in Neualtenburg in which a citizen's participation brings her/him benefit. Create value... beyond a pretty picture, and beyond a stimulating discussion. Choices number (1) and (2) will not ensure the long term existence of the City. But laying the foundations for the stimulation of real commerce... in our own special way... will mean that demand will increase for membership. There must be a "need" to be here, a self-interest in being here. Association with Neualtenburg must be shaped so it is not perceived to be a german disneyland... and so it is not perceived to be a group of intellectual snobs arguing esoteric points of constitutional structure. Being associated with Neualtenburg must come to mean that ones stature; the commercial value of one's goods and services; is of a higher quality by the fact of being a part of Neualtenburg.

To my mind, this constitutes a "sound commercial footing".


Sudane

A rhetorical hat trick! You simultaneously negated another's position, used it as a sounding board, and provided only a vague answer to Claude's question. Since my quote is the target of the negation, I'll volunteer to address the points you provide in the tangential discussion and see if I can clarify Claude's question.

The first feature of the city you dismiss is the sim's aesthetics: There is nothing boring about planning and executing a one-of-a-kind sim. This city strove to go beyond the NESW grid, boxy structures, and gridded sprawl of greater SL and it succeeded. Arising in an organic fashion after city planning, focused artisans did what individual users in greater SL could not: the art and architecture seen in SL moved from the building level to the city level.

I feel that artistic city planning is a critical part of this project. I loved the wonderful ideas Claude provided on where a new sim should be added and how that sim might take shape. In the future I envision a sim that has a single texture pack from which all users must draw (grey glass, blonde wood, and slate) -- beyond that individuals can build whatever they want. I see a sim designed as an interpretation of the architecture in Metropolis (art-deco futuristic German builds). Can't you just see Kendra's builds now?

The point is that the artistic interpretation of city spaces is not a boring element, rather it is an differentiating hallmark to this project. It is one of those elements that makes this project special.

The second feature you dismiss is our method of dispute resolution, namely our government: Anyone who is passionate about this project and wants to see it move forward will become a politician. Think about Kendra leaving her post as Meister, Claude pushing hard for a third party to put forth his ideology, or Eugene flying blimps overhead to encourage others to vote (those blimps have been on the BBC). Politics will be alive in this city as long as there are those who have a passion to move this city forward. Even those who appear uninvolved do act through their representatives during elections.

Again, politics as a form of dispute resolution and collective planning is a differentiating hallmark of this project. As long as there is a desire for citizens to affect change it will exist. As long as it exists we are special.

Finally, at the expense of the first two points you present your thesis:
This paragraph is long, but can be summarized in that you feel that Neualtenburg can only provide value to citizens if it is able to a help sell residents products by rebranding itself as a place where goods and services can be moved. In other words, you want to turn the city into an upscale mall (and possibly raze the existing Bavarian structures?).

Note that the ability to move goods is not a differentiating feature. It's the promise of every dance club, mall, yard sale, and strip club in SL. Don't get me wrong, though. I feel providing a centralized location to sell wares is crucial, which is why I zoned a Kaufhaus (store) right on the Platz. However it is just one piece of the puzzle. Neither point 1, 2, or 3 can do it alone. We need all three, plus a few more very important ones that you forgot:

First and foremost we are a nonprofit land cooperative that allows folks to truly own a piece of a sim and have a hand in running it through a government. True ownership in a sim is another differentiating feature. Finally, what brings people in and keeps them around, is the fact that the land is significantly cheaper than small lots in world. The buying power of the cooperative is my personal favorite feature. Finally, we are one-of-a-kind group experiment in SL that always makes the headlines. In a world with a 100,000 plus people, we're always at the top of the list, when the BBC comes calling. We need to maintain that edge. That is a differentiating feature as well.

To summarize, here is what makes our project great:

1. City planning as art. (differentiating)
   
2. Government. (differentiating)
   
3. Good for sales. (it's not enough alone)
   
4. True ownership. (differentiating)
   
5. Inexpensive land.
   
6. Cutting edge. (differentiating)

To restate Claude's question (in rhetorical fashion), when you say you want a "sound commercial footing", do you mean you want to turn Neualtenburg into a mall, while simultaneously undermining all of its differentiating features?

~Ulrika~

Note - This post is a direct reply to #18 in this thread


Sudane,

All of these points are well taken, but my question (not intended to be hostile) was more along the lines of, "What specific, measurable targets of commercial activity or something else need to be met before expansion is appropriate?" To contrast, I'll paraphrase what I believe to be Ulrika's and my stated positions. (Ulrika, correct me if I'm wrong).


Ulrika - none.

Me- the outstanding bonds need to total zero.

I know your proposals as to how to improve the Neualtenburg commercial environment are forthcoming. It is not my intent to drag them out of you in this thread. I'm merely trying to understand where you hope they will lead, not so much in a conceptual sense, but instead in terms of hard numerical targets, particularly to the extent these constitute a prerequisite for addition of one or more sims.

If I understand your most recent post correctly, you see 'sound commercial footing' as NBurg being a more commerce friendly place that attracts citizens because of its commercial potential. If this is so, how will we know we've arrived at that state?

My position is actually the same as yours. We need to terminate the loans or renegotiate them such they are from now on paid down as monthly land-use fees. I had hoped they would be converted to bonds with a maturity date but that bill didn't pass the RA. I feel we should move forward with that immediately.

We only differ on the rate of acquiring new sims. I feel that we should acquire sims in parallel as opposed to serial, however I recognize that there is more risk in this scenario. I propose that we offer bonds for sale with the goal of raising enough money for at least one and at most three. After purchase, a sim will be zoned and provided with a covenant and sold. The time to profitability and break even on the new sims will be used as a benchmark to gauge the size of the bond offering we will need for the second expansion phase, which I hope will be five to seven sims (to build up to a 3 by 3 grid of nine).

The project should grow from 10 to 30 to 90 members in stages, allowing us to scale as we go, while taking advantage of SL's rapid growth rate.

~Ulrika~

The outstanding loans *are* being paid down as monthly land use fees by those who have so chosen. This was only logical, and has been the procedure from when the loans were first taken last spring. This bill, as proposed, did indeed pass the RA. It was approved with the one proviso that it be implemented with an automated system. That automated system has not yet been created, but a system to do so will be proposed shortly.


Sudane

Claude, I feel these are valid questions. I am guilty of "jumping the gun" a bit on this matter, since I would hope to address them in my proposal.

I started this thread out of a concern to express a dissenting position from the momentum seemingly gathering steam to add one, two, many sims to our current makeup. Since I don't have a proposal assembled yet, I could only express a conceptual position. I'm sorry if it's a bit vague.

I seriously hope to have a plan ready by this weekend. Hopefully that will enable a discussion more on the specific points.


Sudane

Definitely! I would like to see the loans terminated (paid back) for those who have not chosen the indefinite payback option. The way the current system works (as opposed to bonds) is there is no "maturity date", where the city can end the loans and the cost of interest.

Yes! This system already exists in beta along with banking code. Let me clean it up and create a spot for it on the website. I'll give a demo this weekend.

~Ulrika~

Instead of working alone, you should work with your party to create a platform on which to run for the upcoming elections. Make sure you poll your constituents to see if they're behind the plan. If you're acting alone as a citizen, make sure your party receives this information for review and possible inclusion in their platform in time for the elections.

~Ulrika~