Money For Nothing ... Please explain why residents should get Stipends, etc.

Okay - I would like to try something unique - a non flame thread. Please dont flame anyone who responds.

We all have heard over and over the resons for NOT giving away money. We have also heard the resons for having stipends - but it turns into such a flame fest that Forum regulars attempt to bash the stipend supporters to no end and we really dont learn the opposing veiw.


From the way I see it , the reason for support of Stipends (and the ratings bonus) are this -
-People should not have to get a "job" in second life, its a game and they should be able to just have fun.

-People should not have to go outside of the game to get basic spending cash - this should be included in their 9.95 a month.

-People should be able to buy good items at a regular interval just on their stipend.


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my questions -

How much Stipend do you feel is actually useful? $1000L a week? $2000?

If Linden Lab had a plan where you got say $4000 L for $10 a month but no ability to hold 512 M^2 of land , would some people prefer that?

What incentives - if any - should content creators get for creating content?


And the big question - Why should there be a stipend system in place?
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Again in my opinion those who are against a welfare tyope system should refrain from attacking posters - you learn nothing by shouting down people. Those who favor stipends are a sizable chunk of SL residents, and your potential customers.

I think you have answered your own question probably better than anyone else will. The reasons above are all excellent reasons to have a stipend sytem in place.

Personally, I actually ike social controls and "government intervention" (LL giving stipends or whatever) at least in this place. I think LL should use the data that they keep on us, to "rate" us (based on how friendly, nice, creative etc. we are), and dish out a stipend based on that.

That way anyone who is performing better socially or creatively than someone else would get rewarded for it, and all the idiots that dont do anything or just hang around causing trouble would be terribly poor and unpopular. (as they should be)

never happen though.

How much Stipend do you feel is actually useful? $1000L a week? $2000?

$500L per week for a premium account seems about right.

If Linden Lab had a plan where you got say $4000 L for $10 a month but no ability to hold 512 M^2 of land , would some people prefer that?

I don't think a plan like this that has a set value tied to the $L is a good idea at all. Instead maybe word it so that a $10 recurring monthly charge will get you $10 worth of $L, rates set by the residents selling the $L. I think this idea has some merit, as people like myself are always slackers when it comes to cancelling recurring charge accounts. I suspect alot more $L will be sold that way.

What incentives - if any - should content creators get for creating content?

The exchange of $L for $USD should be the content creator's incentive. Other Linden and resident sponsored contests are a good idea as well.


And the big question - Why should there be a stipend system in place?

Absolutely. I suspect the increased stipend is what gets alot of people to upgrade to a premium account. That's the only way LL gets any revenue from a SL user.

I am in favour of the stipend remaining, I am sure there are many that can not afford either the money or time to completely support their secondlife. However, I disagree on the ratings bonus. The gaming of ratings rendered them meaningless. If you want more money than the basic stipend, I see no reason why you shouldn't have to purchase it. How ever you live your SL, for most it's entertainment, you have to pay for that elsewhere right? You wouldn't go to a movie and scream because the popcorn isn't free!

I think a premium account that offered slightly more stipend for those who have no interest in owning land is a good idea in theory, as long as the effect on the economy is considered.

It's worth pointing out that you can not have a stipend that has a RL value on third party sites of more than the fees you pay LL. It would obviously be seriously gamed.

I agree with Schwan on the incentives for creators.

One way SL is very much like RL. Some things cost money, but the best things are free

Stipends are useful for getting a leg-up, allowing new players the opportunity to give SL a solid try without investing anything. A fabulous introduction to anything, as you'll hear any good drug pusher say.

Stipends take the edge off the economic side of play. No one is ever faced with abject poverty - there's always income. This can make playing the economic game more fun (this is one classic game definition: potential for great reward with little risk).

That said: Stipends should never be enough to get by on, week-to-week. This removes the impetus to make the L$ valuable by earning it. The current amounts seem fair, though I support the idea of reducing the stipend against your earnings for the preceding week, as a resident becomes better at earning L$, thier need for the padd decreases. This would be, IMHO, a fabulous control for the creation of L$.

Content creators should be rewarded similarly to how it works in RL - it's all about the market itself and the content creators ability to capture part of it. The ability to convert L$ into real world money is core to this - as a content creator who can make SL into a paying venue has the incentive to add much more overall value to SL than someone who is just watching thier own money dissapear.

This allows all people to bring something to the table in this little shared hallucination - creativity, effort, interest and reward.

"People should get something for nothing."

I love threads where we don't flame, unless it is really creative flaming.

My opinion on why the stipend system is a double edged sword goes as follows:

LL has not placed a dollar value on the linden. If they did, then the stipend would in fact be a rebate on the monthly membership. I see this as a good thing as it encourages the move to a premium membership. They may be trying to force that situations by removing stipend BONUES and in effect using that as a nudge.

Now here is the double sword issue. Let's keep the stipend at 500L as it is, and with no other income in the picture as per the original post, content creators are more or less stuck in a situation of not over pricing items beyond the average stipend.

You see people have been saying, charge MORE to meet the cost of the exchange on the third party sites, but if you throw out the option of purchashing currancy from the arguement, it would take weeks for many people to save up enough to purchase an item based on USD costs.

So how do you keep the monetary incentive for content creators as well as keep folks from feeling they HAVE to work or purchase from third party sites?

I say the ball is in Linden's court to finally bite the bullet and assign a value to their own currency. Use that as a martketing tool to create incentives to become a premium member via weekly rebates on the monthly fee, and hopefully stabilzie the exchange rate for the linden so content creators can have a more reasonable idea of how much linden one should charge to expect a certain return.

I know that will frustrate the day traders, but I'm frustrated right now at seeing the big volume currency folks drive the linden into the dirt.

The bottom line as I see it, until there is a fundamental "official" link between the value of the linden and the value of the USD, it really won't matter how much stipend we get or if we get any at all, the end result is a linden dollar heading to 1 cent per block of 1000 with other exchange sites watching that and following along in suit.

*runs and hides behind Colette*

-Rose....not an economist, but I slept in a Holiday Inn Express lastnight!

I support stipends in general if SL is truly a game - the real question becomes how much of a payment and how often. These can be finely tuned to hone an incentive system, but not to replace it. The over-riding metaphor and objective for a game cannot simply be waiting for your check to come in. A game needs drama, interaction, goal definition and some amount of tension (skill, strategy, play) to drive the core incentive system, of which stipends may be but a piece or tool. If this is the case then there is no rational need to tie the Linden $ to an outside currency at all - and the transfer of any and all intellectual property should be kept in-world for the purpose of game play.

On the other hand, if SL is a platform then the incentive system should mirror real economics more closely. Even if a "fantasy" economy is established in-world the user environment should support a valid price mechanism to effect the most productive/useful/desired distribution of scarce resources, such as computing capacity or prims. A made-up currency should be fungible and fully transferable into real, hard currencies. The effect of stipends in this metaphor is to inflate prices for all players and transfer wind-fall profits to net accumulators of the made-up currency who are incented to re-market made-up currency for hard currency. The net effect of taking away or lowering stipends under this model is to lower prices in-world to levels that support the rise in current incomes in-world.

A secondary exchange, that is a hosted mechanism for re-marketing an existing item whether its a made-up currency or another piece of intellectual property between consenting third parties does not affect prices unless liquidity is an issue. The principal liquidity issue for SL as either a game or a platform would appear to be the hard currency cost of tier. Tier controls the scarcest resource in the game or the platform, which is computing capacity or server cycles - storage is essentially free.

So basically we're dealing with a classic mixed-metaphor, and the answer to the stipend issue is simply not clear. Casual users consider it a game for which stipend is an important source for enjoyment; content creators view it as a platform for which they rightly deserve some RL earnings for their time and effort. LL stands ready to monetize the whole thing if they can just get a big bang event to drive membershipparticipation. And we're the only ones with enough free time to sit and ponder the whole thing!

I think the rating bonus and the pay for stipend are two different issues.

EBay is proof that ratings do not reflect the contribution of a seller or buyer. It is well known that you can post 50 cent, No Shipping, Buy it Now auctions for the sole purpose of getting 100's of ratings in a short time. It is also well known that if you look for these auctions that you can buy 100's of ratings in a short time. There is also the problem, that people out to scam will not rate you until you rate them. If you rate them bad, they rate you bad. You can be the victim of several scams one after the other and have a much worse rating percentage wise than any of the scammers have. This is all without money even being given out for the rating.

Now imagine the situation where you get a continual income based off of a one time fee for a rating. You could even go around paying people to rate you with the knowledge that in the long run you will make all that money back, since theoretically your continual income will keep rolling in. You also can go and rate someone in exchange for a rating you give them. Do you really want someone to get payed based on how many people they can get to push a button. Is that really the measure of a person's contribution to SL.

Now the pay for stipend puts a real life value to the $L bought. When you buy L$1000 every two weeks for around US$3.00-US$5, you will be unlikely to sell that $L for less than US$3.00-US$5.00 a block. If the price does drop below this mark, then more people will start buying on the market, since it is cheaper than their stipends bringing the price back toward US$3.00-US$5.00. The problem with the stipend is that it causes more sellers than buyers. Some actually sell this stipend on the market, but Linden Labs never goes on the buy side to buy it back. Having more sellers than buyers will drive the price of the $L down. These stipends encourage new people to stay, but in order to help the economy stay stable, it should only exist in the proportion that Linden Labs is willing to take out in $L fees. If they are going to give out 10M$L for real life money, they should try to charge 10M$L instead of US$ for the services they provide like snapshots. These services that don't bring Linden Labs any money are the only way they can become a buyer and bring more equilibrium of the buyers to the sellers. If they don't take out an amount similar to what they put in, then they are in the $L selling business only, and will push the market down further and further.

i pay for a premium account. that's not money for nothing.

thinking the L$ will stay up if stipends were removed is a fallacy. new players would immediately be turned off and quit. i know i would have. people have to be ease into the idea of buying L$ to enjoy all the cool things in SL as they start to realise that they are a product of other players hardwork

i believe the L$ can only keep it's value through a combination of constant growth and desirable content creation

This goes back to the mistake that the $L price is based on supply and demand for Second Life products. This is not completely true. It is true that the demand for a product will create demand for the $L, the problem is that it will also create supply when the content creator turns around and sells the $L. The price of the $L is based off the supply and demand of the $L itself.

If half the SL world that now sells $L started hoarding them, the price of the $L would go up. If half the SL world that does not sell $L started dumping on the market the price will go down. However if half the people that want SL goods stopped wanting them, an equal amount of people that used to have $L to sell suddenly will not have $L to sell. If people start buying $L without spending them, then the price will go up, but this doesn't happen based on how much they want a product. This is why the two are not directly related.

Aye, and there is the rub in this whole discussion. So, I ask the rhetorical question, "If it isn't money for nothing, then, what percentage of anyone's premium membership does that stipend equate to? If we have an answer for that, we have indirectly answered the question de jour:

"What IS the value of the linden dollar?"

What makes you think it is the "big volume currency folks" that are driving the L$ value down?

It is in the interest of day traders to have a stable market, not a constantly falling (or rising) one.

There are currently two main reasons the market keeps falling.
1) Impatience on the part of 'small' sellers who place sell orders 1c lower than current for the sole purpose of getting them filled first.
2) Large cashouts by retailers that are barely absorbed by the wanted orders, leaving the spread a little wider for the people in point 1) to fill...

I am all for big retail cashouts, it shows a healthy economy in-world, however convincing people that if they place their small orders AT the current price and not below it seems to be the holy grail.
The trade volume through the for sale list is huge, with the top of the wanted list as the stabalising point. With over 2 million traded each day, mostly from the sale list, 30 mins of patience would go a long way to stabalising the value with no input from LindenLab at all.

questions -

"How much Stipend do you feel is actually useful? $1000L a week? $2000?"

Any amount is useful - but not essential unless there is no game objective that requires the stipend be well-spent.

"If Linden Lab had a plan where you got say $4000 L for $10 a month but no ability to hold 512 M^2 of land , would some people prefer that?"

Sure - most First Land participants only do it for the extra cash from selling at a markup. The casual user has no intention of becoming a content creator - its more about social interaction in an anonymous virtual space, the ultimate masquerade ball.

"What incentives - if any - should content creators get for creating content?"

As a game, they receive the enjoyment, satisfaction, and anonymous recognition of being the set designers, costume designers, etc. of this giant masquerade. As a platform they receive some real earnings after paying the cost of tier or prim rental.

"And the big question - Why should there be a stipend system in place?"

Please refer to the following post for my thoughts on this one:

/130/03/62740/1.html#post655240

An interesting idea, but I don't think it'd work in a world with alts:

Patty Premium owns land, gets stipend.
Betty Basic, her alt, sells Patty's products, gets the income.

I don't have strong opinions about stipends, but I like mine (lifetime account) as it lets me by avatars and other toys, and lets me upload textures without being concerned about mistakes. I do think that the stipend system should be as simple as possible, preferably a flat amount. A game encourages what it rewards, as we saw with rate mining. With a flat stipend, if your target market is basic accounts, you know that L$5 to L$10 is an impulse buy. If your item costs L$1000, you know that even premium account holders would need to wait a bit to buy it unless they purchase L$.

If LL introduced a basic-with-bigger-stipend account, it would establish an attractor for the price of L$. Imagine $10 per month for L$1000 per week, which would be about $2.50 for L$1000. If the trading price for L$ goes above that, it makes sense for BwBS account holders to sell their L$. If it goes below, they'd only buy L$ if they needed them now and didn't want to wait. To some extent that's true now, but a larger stipend would make that choice much more obvious (i.e. would make waiting and saving a more viable option.) The exact numbers chosen would be important, of course; I chose these as the stipend would have to be greater enough than a premium account to make the BwBS option at all attractive.

I suspect stipends increase the overall number of purchases made. If new residents started with no money, they'd either have to earn/beg/be given gifts right away, learn to do without, or leave. If they got a sum up front but nothing further, they'd either blow through that quickly or hoard it carefully, then end up at the no money situation. With the stipend, they're always reminded that buying is possible, avoiding the "I'm broke now, why bother" mindset.

Some of it is admittedly my gut reaction but the game for currency dealers is in fact "buy low...sell high." Else why do it? That reaction is not based on just "how I feel." I tried selling small blocks at what was a reasonable price mark up over the highest "buy now" price. I put it in, and waited.

After one month of waiting, I finally gave up and just sold it.

Why did I wait a month? A few 100K orders got place below mine all at once. Some smaller blocks followed suit, a few large orders got filled followed by some even larger blocks of orders.

I seriously doubt there was a run at the bank by just small block owners.

This is why I prefered the old system GOM had. I could at least be competitive with other blocks of the same size and usually not waited more then a week to a few days. Now, its a nightmare to just sell 10 or 20 K at a time.

Again, just my experience and my perception from working with the new system. It favors the buyer 100%. We can say that is a good thing, but it is indirectly affecting the seller's across the board with ALL exchange sites. Who in their right mind would be offering to buy linden significanly ABOVE what the users would buy it for at GOM?

And before anyone raises the point, I do NOT hold GOM responsible for that. They are trying to survive, but I do hold Linden Lab responsible for not setting a value on their own currency. Like water flowing to its own level, the linden will continue to drop until either a value is placed on it by LL or there is a compelling reason for folks to buy it.

This is just my opinion, but it is not without some history with other game economies. I will point out that for all its limitations, the THEREBuck is still going strong from inworld sales direct to There.com as well as third party sites. Money isn't just printed there. It is based on what a member puts into the system with real USD. That is something LL should stop avoiding and look at seriously.

Now, getting back to topic, everything you and I are saying is like comparing apples to oranges when we bring in the stipend issue. Because until there is a logical official value placed on the Linden, stipend as game money and game money as USD exchange is just that.. apples and oranges.

Rose

Hmmm. Pardon my thinking as more often than not it goes awry, but, wouldn't a more accurate statement be "It is in the interest of day traders to have a volatile market, a constantly falling AND rising one.

No. Even day traders want a stable market, there will still be a spread. A volatile market will result in some winners for sure, but just as many losers.

Ages ago I postedTHIS THREAD -- since then my brain has turned inside out trying to understand how there can be a solution. We have two different attitudes that just don't seem to mesh - I agree that it would be great for there to be a larger stipend for those who aren't interested in creating/selling - but nothing is there to stop that money from being sold. What if - and this is not thought out AT ALL and I am definitely not knowledgeable about economies... but WHAT IF there were Lindens that were given as stipend money - First Lindens, sort of - that could only be spent inworld? Once they'd been used to buy something they became ordinary Lindens. OK - have at me

It could still be gamed. What would stop someone buying their own alts objects?

Yes, you're right.

Linden Labs has our credit card information, and they have our email addresses. They can tell to some extent when someone has an alt, by looking at how many avatars pay with the same billing address and name. There is still the possibility of people using cards with different addresses, but in the end they should know the bulk of alts through the credit card information.

Osprey's idea could work if Linden Labs was willing to keep alts from giving each other the frist $L coupons.

OK then I will buy my friends objects, and she can buy mine

It will always be gamed.

That is true, and there also has to be a seperate redemption process, either the seller has to know they are giving the product away for free or Linden Labs has to buy back the coupons.

I think Osprey meant coupons that turn into L$ when a purchase is made. If you are talking about coupons that remain coupons, you will just end up creating a whole new additional currency. Just wouldn't work.