My Response to the Falling $L Value and If I Lose My Stipend

очень хорошо

If they are sure that the stipends are no longer important to them, repaying them doesn't (AFAICS) hurt anyone else.

Я люблю эти переводчиков интернета! Смотрит как я получил что-то сказать но я справедлив идиот использует страницу интернета для того чтобы перевести это к русскому языку.

Как раз ягнящся

a) selling L$ directly will at least in part recoup that revenue from direct sales of L$

b) not so... the stipend is not motivation to buy land... there would be increased incentive to own land, because the cost to own land would be lowered, no premium fee to consider. It would halve the amount of money you would have to commit just to be able to own land. How does halving an upfront expense, removing a barrier to entry, not encourage people to own land?

c) I was asking about how this would suit the consumer, rather than it's viability for LL, even though I've briefly stated how this coud work for LL. I could easily expand on this aspect, but it's not the question I'm asking.

d) Expanding slightly, LL's primary business is tier, ie renting server space. The non-tier percentage of the premium fee is a fraction of their overall business. If this encouraged land ownership, for the reasons stated above, then it would be viable for LL.

That depends on the L$ market recovering enough that sales of printed L$ can be supported without creating another crash. That has yet to be seen



The question isn't about owning land, the question is about buying land from LL.



It may be viable, but at the moment, LL has a large number of servers and isn't making a profit, possibly because due to land resale so many of those servers are being tiered at maximum discount. This also means that because individuals own large amounts of land, even a small increase in the cost of tier could be multiplied many times for them and cause a lot of bad feeling. The non-tier percentage of the premium fee is a fraction of their overall business but it also has the best money:work ratio of all the things they sell.

One thing that I haven't seen anyone mention (maybe because I havent looked enough) is that with this runaway inflation that SL is experiencing, the $500 stipend is becoming more worthless per day.

After my timeperiod runs out Ill will prob. go to basic and buy Lindens on the exchange, since I don't own any land. At the current rate I will average L$808 per week spending the same $10USD. If anything LL will be forced to increase the stipend, so people will not revert to basic. Think that will get anyone riled?

It is definitely in LLs interest to stabilize the currency.

Yumi could you explain what you mean by this?

Yes, I find this surprising. It's rapidly reaching the point where there is no benefit buying your L$ via stipend.

It's in LL's interest to encourage people, as far as possible, to buy land directly from them rather than from land resellers. If they buy from land resellers, the land resellers can usually undercut the undiscount price LL would charge the end user and then tier the land themselves at maximum discount, thus "skimming" LL's potential profit.

The 2000 Linden/month premium stipend is a strong incentive for the casual/consumer users who perhaps just wants to own a house and garden, to get that by buying from LL rather than from a land reseller. That way, they not only get a house but they can also furnish it and start dressing nicely without having to spend more. Without that stipend, a land reseller could easily undercut them, especially since (as I posted before) the equivalent of a first land plot costs a land reseller only $1.50 in tier. They could charge $3 a month to the new users, still be undercutting LL, and yet if they could fill a sim with these they'd be making US$390 - enough to tier the sim plus an entire second one!

Excluding first land, and auctions, you can't buy land direct from LL unless you buy a whole sim. Hence, land dealers. Their whole business is based on smaller customers buy land via a land dealer. They just aren't in the business of selling land directly to small customers, they sell in bulk. It's efficient, it offers LL economies of scale, that's why they offer tier discounts. Remember, full sims are sold for US$, not Lindens. Selling small customers parcels for US$ would be messy, and not necessarily more profitable, because of the economies of scale, otherwise they would probably already be doing that if they saw this as you do. The intitial land sale is about mitigating set up costs, their primary business is tier.

The casual consumer, in the scenario I describe, can afford to buy that same stipend off the Lindex, if they wish, with the amount they save on premium membership. The net effect to them is the same. If they don't wish to spend that much however, at any time, they can choose not too, and enjoy the lower fixed cost of owning land. This just offers them choice, which is always good for a consumer, I feel. I guess I just see the basic dynamics of LL's business differently to you. That's ok, my intention was not to push or debate this particular model, but rather to see how people felt about this as a consumer. My suggestion of this model was based soley on the direction I see LL moving towards themselves.

Myself, speaking purely as a consumer, I would see this as a more desirable situation. My fixed cost would be lower, and I could choose to buy my Lindens, when, if and at what price suited me.

Sorry - you pay your tier to LL. What they are competing with from land dealers is of course land rental.



It isn't, because the psychological situation is different. If I'm going to get that 2000 Linden anyway as a consequence of paying for my land, I'll feel a lot more free about spending it that I will if I have to pay for it seperately and then it is gone.



LL are not profitable now. Anything that reduces their income is a bad thing. It's also a bad thing for the SL economy as a whole, because if LL can't profit eventually the SL economy as a whole will go pop.

If LL wants to take away stipends then it needs to be starting with any new accts, just as they are doing with new basic accts. It isn't fair that I should lose my stipend when I have been here since 2004 and am accustomed to having it. Sorry but I'm not made of $ irl and it's nice to get a weekly bonus to be able to shop or whatever. I just consider it a bonus for putting up with down time during upgrades or grid attacks, technical problems and for being a premium citizen. I am starting a store with my partner and my stipend will help me be able to buy/upload textures as well.

Think badly of me if you must and think I am a drain on the economy but I need my stipend and feel we deserve it. If stipends are taken away, I will have to seriously rethink staying here...

We paid for our stipends. Thank you! Have a nice day.

Yes, LL is in a real dilemma. There is a stream of thought on this thread that, if the Premium stipend is reduced or eliminated, many Preimum members would downgrade to Basic, rent land from fewer and fewer suddenly mega-land barons, and still do business as a lessor without the $9.95 US membership and any associated land tier fees.

OK, in that scenario, thousands of members board the Basic Train. This would represent a huge negative impact on LL's memberships revenue stream alone, and, of course, their P&L projections which I am sure the investors review quite frequently. Plus, the results would ripple through the real estate glut, only made worse by former Premium members unloading land at deep discounts and even abandoning land. Madame Governor would be very busy picking up land I am afraid. Fact is, the land barons would have a limited appetite - even for cheap land, especially when the customer base began to shrink rapidly.

On with the Scenario....

Land values on the mainland would plummet, as would rents. The supply of all the new rental property would far exceed the demand. But only for a time - at least until LL would do the unimaginable and actually downsize the grid due to vast tracts of unsold, and abandoned land in the now bloated Governor Linden Land portfolio. The removal of land from the grid / real estate market would come from intense pressure by the land barons. Afterall, how long could they carry tier on unsold land and also continue to rent land at below carrying costs? Something would have to be done to bring up land values. Obviously, that could only be done by a reduction in the available inventory.

As an aside, that is the primary difference between the SL and RL real estate markets..... as my Grandfather always said, "Invest in land, God stopped creating that commodity a very long time ago. Values will only rise over the long term." He could not have envisioned such a world as SL, I am sure.

Island sales and future value? Don't know. That is a really mixed market. Large numbers of islands exist due the huge successes of the very few in the SL economy. Many islands also exist because the resident's RL income and life style permit the expense. Again, a real LL dilemma. In the scramble to replace lost revenues, LL could look to the islands for increases in monthly tier fees. That would be very difficult if not impossible, as it would have a major impact on the land barons and the smaller players who rent out island parcels. Even a small incrase in monthly tier for an island would translate into $1,000's USD in monthly carrying costs to the large land barons. I guess 'special arrangements" could be made with the land barons and only the pure residential leisure owners be impacted by an increased monthly tier fee. But, that would be a VERY risky move and good way to drive down island values as those effected might throw up thier hands in disgust and leave SL, or board the Basic Train themselves. Lower island values, even in the short-term would definitely impact the land barons with huge island holdings.

On, and on, and on......

Oh, well.....scenario's are fun.

The King said it best:

When I was a boy
World was better spot.
What was so was so,
What was not was not.
Now I am a man;
World have changed a lot.
Some things nearly so,
Others nearly not.

There are times I almost think
I am not sure of what I absolutely know.
Very often find confusion
In conclusion I concluded long ago
In my head are many facts
That, as a student, I have studied to procure,
In my head are many facts..
Of which I wish I was more certain I was sure!

Is a puzzlement !

Oh yes. That is exactly what LL are worried about with the value of the Linden. It has nothing to do with all the economy or the *cough* experts. Every landless prem account holder dropping to basic is probably something that keeps King Philip awake at night.

So, for those to lazy to get the numbers here we go (This only applies if you don't own any land).


Paying US$9.95 a month:
Account costs you US$119.40 a year.
At this second, US$119.40 buys me L$39183
That gives me a L$754 a week spending money.

um .... why are you still here?

Paying US$22.50 Quartly
Account costs you US$90 a year.
At this second, US$90 buys me L$29511
That gives me a L$568 a week spending money.

nope ... still better than your stipend, hurry hurry!

Paying US$72 Anually
Account costs you US$72 a year.
At this second, US$72 buys me L$23598
That gives me a L$454 a week spending money.

Phew, still a better deal. Today.

So, unless you own land, are paying anually or actually give a fig about what happens to Second life - You should be switching to a basic account and buying your pocket money on the market (esp as that gives you an extra L$50 a week not included in the figures above)

OTOH, if SL is actually important to you (and it is to most of us) you will keep your landless prem account and accept less pocket money. But if they ever try and take it away, its going to bite them in the ass so hard.

Ninja: that is a perfect summary. Nice writting.

See I was with you until the end Actually I signed up premium for the express purpose of attempting to help LL, while also giving myself some pocketchange.

At todays rate of L$350, ~$6.20USD goes toward the stipend. (500*52/12/350)
At tomorrows rate of L$400 , ~$5.40USD is allocated for it
In 6 months if the exchange rate increases to L$500, then $4.33 of the $10 monthly fee goes to the stipend. There WILL reach a point from those of us with limited resources where we shall punt (to use an american football term), switch to basic and become more SL wealthy in the process.

Interesting enough the exchange rate breakeven for a premium account seems to be $361, which the Linden is rapidly approaching.

Doesn't consider a good portion of the fee goes to Land usage. Roughly half goe to the 'free' 512m2 teir.

Monthly: paying $59.70 a year gives you how much?

Quarterly: paying $45 a year gives you how much?

Annually: paying 36$ a month gives you how much?

So you believe that if the minimum buy in for land ownership went from $9.95 to $4.95, that would not encourage more to buy land, but rather, would encourage them to rent? I would expect the opposite to hold true.

Most premium members at the moment use the yearly fee which makes the minimum buy in $6/month. However a land reseller's monthly fee for that minimum amount of land is only $1.50.

If LL cut the 512sqm fee to $4.95 but stopped the stipend, a land reseller can undercut them and offer exactly the same for US$3 - on a zoned private island!

Bear in mind also that with no Premium stipend, the new Premium member would have to buy their L$512 for their first land on LindeX. It'd only be about $2 but again a land reseller could easily waive that entirely (they'll make back their flat fee after a few months of rental profit) creating a more psychologically attractive offer.

If it went to 4.95 (less quarterly and annual discount rates) I would keep premium myself. My only complaint would be cutting stipends without either providing equal compensation or cutting fees.

Yumi, I don't agree with your assessment, but I won't continue debating it, because I don't want to take Coco's thread anymore off-topic than I have, and because the viability of this for LL was not my question... my question was, would people find this acceptable or desirable as a consumer, as I stated here:

"When you kill second life you will move on to the next game and do the same thing."

Like a virus, or a leech. Can't say you'll be missed.

Musuko.

Yes. A lot of people seem to believe that anyone who's hardworking, and has a good attitude, should be able to earn L$ in SL.

The only problem is that that means the people who don't earn L$, and therefore buy them (thus stabilising the market), will be the lazy people with bad attitudes.

If you want to stabilise the market, they are now your customers