SL is killing itself

I opened shop almost immediatly after joining the SL world last August. My first transfer from L$ to $US sold at a rate of 258L/$1. Since then, I have yet to sell at that rate again. Matter of fact every single time I have sold $L, the value of the L has steadily fallen.

It is now getting to a point to where it doesn't even pay to use RL time to make in world products because the return rate is far less than minimum wage.

I understand there is post after post about the steadily fallng Linden value. My thought on this is I see nothing being done. I tried dropping 10,000 Linden in a lower bracket and sat on it... for 3 months. Never did it sell.

At the rate that the value of Linden is falling, it wont be long til it is literally valueless. It is almost to that point yet LL still claims that there is income potential in SL.

My question is... will Linden ever restore its value? Or will we just sit back and watch until its literally worthless.

What can small town business people such as myself do in this case? I'd be happy to help in anyway posssible but putting your Linden in lower brackets forcing people to buy there doesnt work. You just go uncompensated while others continue feeding the falling market.

Only reinforces that Second Life is a game, which you play beacause you want to.

When your desire to enjoy SL is overriden by your desire to make money, in my opinion you've lost the point in playing.

What I don't understand is people saying the value of the L$ has dropped. Look at it a different way.

L$300 for $1 is a higher value to the buyer than $275 for $1.

The more L$ for the $, the higher value to the buyer, its the seller who's SOL.

Everything I sell is less than L$100, because I enjoy building, I don't do it to make a fortune to cash out.

There is nothing more satisfying than seeing your product in someone else's property, and they are getting the enjoyment out of it that you designed it to give. Much better than 5 cents in your pocket that you sold it for.

Remember... once you have created an item, that is it. Every one that you sell costs you absolutely nothing. So if you disregard the time you spend making it as just fun, then concentrate on how many you sell... ten sold at L$250 is $8 of cash in your pocket for no effort whatsoever.

You cannot apply real world laws of supply, demand and construction costs because apart from your time (which is free, because if you were in SL or doing anything else, that time still passes by) and texture/sound uploads, there is no cost to making anything.

Too many people have lost sight of the entertainment value of SL. Sadly, LL's marketing lies of making thousands of dollars a year have lured many people here under false pretenses, who have all gotten just as discouraged as you because they thought it was an easy way to make money. Forget the turnover, build for fun, and you'll find that you actually begin to enjoy the game again. Selling stuff is just a bonus.

Lewis

It is infaltion, every country has it! I work in RL for a company in the UK that sells to the US, since 1997 the USD has gotten weaker (in respect to the GBP), we don't turn round to americans and say " Oh sorry but at our price we are starting to lose money, so we won't sell to you till the USD gets stronger", we say " it now costs more USD!".

So I would say to you and all the other sellors in game, put your prices up! and the effect will be people will buy more L$ increasing demand QED better exchange rate, and you may reduce your L$ price (or then again you may not! LOL)....

My prices aren't moving, I don't care what profit you need to make

Its a game, I don't cash out.

The problem with the "entertainment value" angle is.. well, the tier issue.

From what I can tell, historically, the L$ was supposed to be used for giving people shares of the server. The stipend represented your "fair share" of server resources and you spent it to rez objects or maintain them in world. Or you spent them to buy other people's things which would enable them to maintain them in the world for longer. So server resources were focused on maintaining what other people wanted most.

Then after v1.2 it was all about US$. So you can build wonderful stuff, but get nothing but largely-irrelevant L$, and face a US$ fee for doing it. The ability to exchange L$ for US$ is the vital missing link to plug that gap, but, all the signs now are suggesting that it was introduced only because it's the vital missing link.. without checking it was actually viable in the market. If I have some stuff I need to sell in order to stay alive, that fact unfortunately doesn't make buyers appear.

Presumably, when 1.2 came out, LL intended that you would be losing US$ and gaining only L$. They didn't introduce LindeX then, after all.

And.. well, I fear there may be a comparison/jealousy issue in force regarding the entertainment value now, too... or that might just be me :blush:

If your worried about minimum wage for creation of items, it's my opinion you're making things for the wrong reasons.

I make things for the love of making them - with little really expected in return. I like to think it shows in my work - which ultimately shows in the return I get for them.

Expect the world and get little in return.
or
Expect little in return, and get the world.

Better phone the Samaritans, then.

This is not rocket science. And this is not Warcraft.

Scaleability. Understand this concept on a nontechnical level as well as the technical.

Does this game boast weather? or a reflective surface? I dont know and I'm asking. But if the answer is No, then Linden is too focused on drawing people in to a limited environment, which implies limited ways to do ANYTHING, including make money.
Only 1% of subscribers can understand programming languages. And they dont want to learn how.

Keep boasting that Wired Feb 8th ad, and keep throwing new land out at auction like so many dog bones, and SL WILL fail, or have to drastically change its marketing, or wind up just a place to meet others (which is a good thing if marketed for what it is), with a forced change on marketing.

If the Linden is 330 now, falling from 270 a month back, EVERYONE who owns any Linden has lost over 20% of value. Period.

Its game money. Who really cares?

Obviously a lot of people care about that. There are people who try to pay their tier with the money they earn here.

That would be part of the problem.. if they want to pay tier with money earned in game - they need to be grateful that they can instead of whining so much. Most games you can't do anything of the sort.

I see the osteriches have already arrived in this thread and declared there is no problem.

Its obvious the L$'s slide is a problem to non-osteriches.

It's only a problem to the sellers, it's great for the buyers.

As there are far more buyers than sellers, overall it's good for the game because it pleases the majority.

Lewis

I don't know if this matches the actual motives of LL (since they often seem to be hard at work turning the place into just such a "capitalist wonderland" as some of these other posters expect it to be), but for me I agree 100% with everything Lewis says here. This is the exact same approach I take to SL and if we all did the same would be a much nicer place IMO. I am getting so sick of all the ridiculous "economics" threads being posted in the forum and all this chicken little crap about the value of the Linden.

Eh, but if the $L continues to slide, it shows there's less of a demand for the money, which means there aren't enough people buying it, or there's too much of a supply (I'd suggest the former).

I agree with your earlier sentiment, though; if you're here for the money, you're doing it wrong.

If people trying to cash out didn't spend their time competing with each other on who can offer the lowest prices they can possibly manage to ensure that they sell first, and in some cases perhaps even do it deliberately to drive the rate down, you wouldn't have so much of a problem. Race to the bottom, baby. Spend your L$ in-world, or Lindex-link your prices, or live in an SL commune, or just forget about the whole idea of making money.

Half agree. If I'm in SL for fun, my time's free.

But if I'm in SL because I have to be, it's a job, and if it's a job it's gotta pay at least as well as spending that time doing contract programming. So unless the Linden suddenly starts trading against the dollar at 3:1 instead of 300:1 the exchange rate hardly matters. I'd have to work way too hard at making money in SL at the current rate to make it worthwhile doing it as a job.

That's a very good point actually.

LL pride themselves on their "hands off" approach with regards to SL, enabling the community to grow, work, adapt and develop as it wishes.

However, they do over-promote the economy, almost to the detriment of the social and fun aspect... which leads me to question..... if they are truly hands off, why do they choose one - fairly unpopular, I might add - aspect of the real world to try and force on SL?

Everything in SL is optional - except participating in the Linden-created economy, driven by a small minority of individuals whose only interest is profit for themselves. That's the land market, and it gets in the way of pretty much everything I wish to achieve because although I can afford tier, I can't afford the tens of thousands of L$ I have to buy - again, at a rate set by this same group of people.

Our little group of economists are whining because the L$ has 'lost value' to them, with no regard to everyone that's benefitting. Who are they to decide that L$300/$1 or even L$350/$1 is not where the value of the L$ SHOULD be, rather than an arbitrary starting price of L$250/$1 which was set as an opening value.

The economists want a free economy ... yet are complaining because it's doing exactly that. but it's not doing what they want.

A lot more people would be having a lot more fun if so much of the game wasn't rotating around money. In other games, you can kill things and level up to develop your character over time - yet here, all you need is a few thousand dollars to 'invest' and a free basic account, and you could be the next 'big name' in just a month or so, assuming you have the freedom to spend all the time you want, and not work for a living like most of us have to.

Lewis

I have to agree with Siggy here i believe my reason for the "success" i have is I absolutely LOVE making things.
my first and foremost reason for selling any thing in Sl is for the love of it.
the money side is secondary if i can pay my tier and turn a profit then that's great. if i cant then so be

you must love what you do but if you don't love what your doing and your only in it for the money open a casino or buy and sell land that's where the real money is.
all the best
Crucial

Frankly I think SL's "Killing itself" started when they put a real money value on the L$ in the first place..... le sigh.

I cashed out once so I could afford a new monitor (Mine was steadily dying) but I don't think I'm gonna again.... not until SL goes into the tubes.

And I don't think that'll be very soon.

I have found them confusing. SL has, at best, *HALF* an economy. There's no stocks, no Bonds, no loans, no investing, no gold backing, none of the behind the scenes scaffolding that help support a normal economy. SL is 100% consumer driven. And yet, people are trying to apply real-world economics to it. Just seems silly.

The current 'strength' of the L$ is *entirely* dependant on the people selling the L$. Every one of them MUST type in 2-7-8 or 2-8-9 or 3-0-0. There are no other economic factors influencing this. There is no Greenspan Linden who's stray cough suddenly sends the L$ plummeting. Conversely, there is also very few handles that LL have to influence the market.

So why is there so much L$ being sold at these rates? The only reason I have ever seen is 'tier.'

But why hurt the market you are depending on? To sell quickly to make Tier.

Then why carry more tier than you can afford up front? "This is my job."

I guess the question that mystifies me the most is this: Why are people trying to support their Real World lives with a virtual job that pays in a virtual currency that has no real-world backing and only a shadow of an economy to support it?

What if LL declares Chapter-11 bankruptcy tomorrow?

I know LL promotes the money-making aspect af SL quite a bit. But come on, you don't put your feet up when sitting in a 2-legged chair. That's just common sense.

And you CERTAINLY don't complain to the maker of the chair when you fall over backwards in it. That just makes you look stupid.

I guess I should be constructive in this post.

What can be done..
.. by LL?
I think they should set the exchange rate hard and leave it. If they want $250, make it $250. Make the LindeX a FIFO system and be done with it. Everyone wants a stable currency, it doens't get more stable than that. There are no other 'economic factors' to be concerned with, so just set it and forget it. Then adjust the supply and sinks.

...by players?
Failing the above, people need to start selling at better prices. If you want the L$ to go up, help the situation, don't hurt it. If you can't make Tier, then tier down. HUrting the market is only going to make it harder to make your tier payments down the road anyways. Find a tier level you can support until the market gets better.

If SL is your only source of income, get a RL job. Flip burgers part time, or sell CDs. Just two days a week (16 hours) at Federal minimum wage is $240/month after taxes and deductions. That's more than the monthly fee for an entire island sim, and it's entirely above and beyond what you are making in SL. You don't have to worry about making your monthly payments to LL, and you can sell your L$ at a better price and make even more money.

It's all mountains from molehills. The biggest problem is that people have built their house on a molehill expecting the foundation of a mountain, against better judgement and all common sense.

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Dear god.. I start a reply just to make a short reply and end up with this..

I think the simple fact of the matter is that in Second Life you have a few very talented people who create build, script, and run or host themed Sims. These ideas work and hence are in demand and generate fungible value. These people can make serious money much better than a "MacJob". Indeed a case can be put forward that perhaps Second Life can empower people who have ability not recognised by their everyday peers in First Life.

That’s great and all down to either a chance encounter of the Second Life website or hearsay via other media.

But......I have been in Second Life now for around 4 months and every original idea I have seen has myriad imitators most of which are not as good as the original.

Of course what then happens is either people get dispirited and leave or attempt to make money via the in world social security system of stipend, pay chairs (supported via dwell or other traffic generators) and any NEW original idea/creation becomes rare to non existent.

So, my own view is that to succeed here in terms of financial gain requires an original idea, or at least a better variant of an existing one. I believe I may have two such concepts, one of which has just opened in Plush Zeta, the other.... well you will have to wait a little longer for that.

So for 95% of users here Lewis may be right, just enjoy it as a new type of platform designed for self created entertainment. In saying that though that does not take away the fact you need an economy and an ability to make real money to make this platform commercially viable.

Finally two things may change that, one is a stable currency and the other is the easy ability to sell First life goods and services within world.

I'm surprised this hasn't happened yet. It really seems to be the logical next step and not a difficult one at that.

A Real-World purchase can be handled just like buying L$ on the LindeX. I see it happening like this:

1. You choose the RL items you want and start the checkout.

2. The transaction is handed off to LL in it's entirety at this point.

3. You are then presented with a SL Client dialog box outlining the items to be purchased and the prices, subtotal, shipping, and total. Just like purchasing some items now.

4. If all is ok, you continue and are present with another Client-side dialog box requesting your Account Name and Password. Just like buying off the LindeX.

5. If the account information is correct, the purchase goes through and you are dispatched an e-mail recipt, same as a LindeX transaction.

6. LL then pays into the business' account, but in US$ and the owner is notified of the successful purchase.

This would provide a unified transaction method, making it easier for consumers to use the new services. Also it would mean that credit card information would never be given to the businesses, all financial information would be controlled by LL. Additionally, because the transaction is handed off at the beginning *before* verification by the purchaser, it would also eliminate the possibility of someone exploiting the system to create false transactions or padding the bill.

And most of the fuctionality is already in LL's hands, just in different places. Bringing it all together would provide a safe and secure environment for the buyer, and would eliminate the liability and hassle of handling transactions for the buisness. This second part would also make it easier for small buisnesses to offer products and services within SL, when they normally might not be able to.

Ok I have stayed quiet long enough on these matters. What Lewis and a few other "Buyer Favored" residents are fighting for is relevent BUT here is what they fail to realize. You built, Design, texture, script, whatever, for fun and that is great, I'm happy for you, I do what I do for fun as well, because I enjoy doing it. Think for a minute tho, don't you think creators at such stores like Ricx, Nomine, X2, Novum Inc, do it for fun as well? It's just like the real world here in SL. People apply their real world talents, that most have paid real world money to perfect. True, they did not go to school, where they had to pay real world money to go, with the thought in their head that "Hey, I am going to be the best so I can get rich in SL". No, they went to these schools to develop and hone their skills to make money in a market. A market that SL created possibilities for them.

"Time is Money"

This is so true on many levels, and it goes without saying that many creators and developers have invested a lot of time that is well worth the money they have asked for that time. Sadly, however, that "Buyer Favored" facet of SL is basically telling these people their time is not worth as much as they think. Eventually these developers are going to listen to the "Buyer Favored" and find a new facet to present their work and SL will lose out.

Granted, I have not been in game very long, 7 months roughly, but this recent slide in currency value has been just that, recent. It has been a strong and steady slide that has happened in the last month or two. The cause of this, greed, most likely from the newer breed of residents. If you go to the "Sell Currency" page here on secondlife.com, there is a nice little spreadsheet style list that shows how many people are selling L$ and at what rate they are trying to sell at. This is pulled directly off the Sellers page at 3:46pm EST, for those of you unfamiliar with the listing format, the first column represents the Rate at which they desire to sell, the second column is how many are trying to sell, and the third is the total amount trying to be sold in USD value.:

L$1 / US$1.00 - 46 - L$13,332
L$13 / US$1.00 - 6 - L$16,738
L$100 / US$1.00 - 11 - L$104,630
L$250 / US$1.00 - 34 - L$391,817
L$290 / US$1.00 - 38 - L$2,280,671

This my fellow residents, is whats wrong with SL's "dieing" economy. This is the source of everyones woe's. For those who can not decipher this, there is 46 people trying to sell their L$ dollar for Dollar and make $13,332 USD, which averages to about 290L$ per person trying to sell. Now new residents start off with 250L$ when they join..... make sence? Now I am NOT saying that all New Residents are greedy pigs sought out on destroying the market. Just 46 of them, or maybe 30 of them and a few older residents trying to sneak in a few bucks. Either way, this money will sit there until the BUYER'S are willing to pay more USD for less L$, which will never happen, so that $13K USD will slowly stunt the market. Now, we have those 38 trying to sell at a rate of 290L$ per 1USD, That averages out to about 60,000L$ per resident at that rate, these look more like our developers who are just fighting to stay alive because 60K roughly tranlates into about $210USD per resident, IF they are to sell at that rate and since the highest SELLER exchange rate is 293 right now, they stand a fair chance, for now. As this trend continues tho, in 2 weeks or so, those 38 people selling at the current ample exchange rate, will have about as much of a chance at selling as those at L$100 per 1USD, Slim to None.

So quit complaining to the developers who want fair trade for their efforts. Start Complaining to all these residents trying to sell below L$250 Per $1USD, They are the ones dragging this "economy" down, THEY are the ones "killing" SL.

'Nuff Said.

As this is the "Land and the Economy" forum... the "Game" vs. "Not a game" debate belongs elsewhere.

SL is not killing itself. I'm not saying "everything is fine", SL will recover from this one way or another. The L$ value might NOT recover from this however.

If you see the end of the world... then follow the rats off the sinking ship. Without your deadweight dragging the rest of us down we'll float along just fine for a long while to come.

SL is what it is... It is NOT communist... and you are NOT guaranteed a job. Just because you can make something... and can sell a few for a while doesn't mean SL or anyone inside of SL owes you a living.

Real Life changes... SecondLife changes. You change, you adapt, you overcome and survive... or you stagnate and get rolled into the compost with the rest of the mulch.

What are YOU doing to compensate for the sliding L$ other than complaining about it?

Get a better game plan, play a different game or reconcile yourself with losing.

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*QUITE* fed up with the 'wah wah wah'.