Double dipping land tiers....

Please correct me if i'm wrong - because when i asked billing@ i got a rather banal answer that didn't enlighten me or give me warm fuzzies at all...

Scenario:

User A owns land, lets say 32,768m2 and has paid tier on it on the 26th of the month.

The land is up for sale - and happens to sell three days after tier has been paid - no problem there, it's better that the land is gone now as it needed to be sold so User A could tier down.

User A tiers down so that their land holding is nothing.

User B, who bought the land, has obviously had enough "allowed holdings" meterage to be able to absorb the purchase, or has had to tier up to absorb it.

The next billing cycle comes around and User A notices that they are charged tier again, even though they owned the land for 3 days of the month and tiered down immediately.

User B would also have been charged tier for the land because they owned that land for the other 27 or so days during that previous month.

Is it just me or is this double dipping? both owners of the land have paid full tier for it for that month (US$125). Linden Labs has effectively made double it's money on that one piece of land for the month, this would also be the same for nearly every single sale of land.

While some might say that User A should have waited until their tier was due - who really can be that choosy when selling land and offered a good price, unless you're initials are A.C.?

Seems to me that LL's is making a nice little profit here:

Double dipping the land tier fees
L$10 for each upload
No more developers incentives
No more dwell
No more L$250 start up for newbies
No more stipends on some accounts, which will undoubtedly move to premium accounts in the future

So i'd really like to know, what is this money going towards? It used to support in-world resident activites, such as stipdens each week, starting money, dwell payments etc. etc. that's gone.. where's the money going now (and yes it would be a considerable amount)? how do we as residents benefit?

The money goes to paying LL's bills.

This is fairly standard practice for a lot of high-bandwidth services. it allows them to cut just a bit closer to the bone on overall pricing, with these overlap months ever so slightly expanding the margins so they can survive as a business.

Its unfortunately a side effect fo what I see as a way to keep people from abusing teir switching. Someone (whose name I have forgotten) asked me in game why they were charged teir even though they switched it over to their partner. Apparently they thought switching it back and forth when teir came up would keep them from being charged (holding no land when teir is due).

Basically you are charged the price for the highest tier you use that month regardless of when you use it or for how long.

As far as the L$ they are taking, they refer to them as 'SINKS' in the economical data, however they plan on selling them on the Lindex in the near future. Here is the quote from Philip Linden at the last Town Hall meeting:

I think that's a bit of a cop out, i know i paid US$1,250.00 for my Island setup - that was the cost for them to buy the server etc. while i realise not everyone has an Island more and more ppl are getting them and we already know that on the mainland servers are used for more than just one SIM.

It's not about the actual land... its about the quantity of land each account is allowed to own. For a moment, or a month, makes no difference.

Tier fees aren't rent.

Mmhmm i'm aware it's not rent, however a pro rata scheme might be a little more fair? - for 3 days they get a whole month's tier from one person, and a whole months from the new owner... just a thought.

Yes it's fair because it's published and it works the same for everyone. We griped a bit when 1.2 was released with this whole new tiering thing; but, it's probably kept the company afloat these past months.

I often say that LL don't care if the bulk of the mainland is set for sale as long as most of it is tiered. That thought is morphing now into, perhaps they're happier when the bulk of it is for sale because that increases the chances of a month's double billing on the parcels.

Wonder how they encourage us to set land for sale and want to trade it so often?

I feel its fair as in it hits legitimate land deals much less than it would allow land switchers if it didn't exist. Think of how many would cheat LL.

Well... rather than fixing the double dipping concern... I'd rather see some form of escrow process so 2 or even 3 way land&money transfers could be performed more securely, without the need to tier up to buy new land before you've sold your old land.

Linden has a hard rule when it comes to tier: you're charged for your peak usage for the month. The inflexibility of that rule prevents it from being gamed, and maximizes profit for LL. If LL can't be profitable, there will be no grid for us to enjoy.

However, the inflexibility of this policy does not mean you're out of options. One thought: you could have grouped the land, and then either 'borrowed' tier from friends, or 'rented' tier for a short term from a land trader until the land could be sold.

Renting tier, especially on a short-term basis in order to prevent paying a full months of tier to LL can be a win/win for both the tier renter and the rentee

Linden Labs needs to make money to pay their employees, for bandwidth and to keep the electric on. For the time I spend in there the fees seem quite resonable to me. In fact doing a little math I think the land teir fees are probably LL's primary source of income.

About $200 a month for a whole sim is within reason to me. They put four sims on a 4 processor server so that's $800 a month (quite a profitable server hosting business!) If the land is subdivided then the fees per m2 are considerable higher, more like $500/sim or $2000 per server (which is an amazing server hosting business!)

While that's a very very profitable server hosting business I say "Good for them". They have a lot of bills to pay and of course is has to cover the asset servers, login servers and other stuff as well.

One thing I think is a problem and misleading is that when you buy land and get automatically "teired-up" then sell and you do not get automatically "teired-down". That means I end up paying for more land than I own because I was not aware I needed to find an obscure page and force my teir back down.

The double dipping can be a drag (I once sold land 3 days late as well and had to pay full tier even though I only owned it for a 3 days during that billing period) but it's the same rules for everyone and LL isn't exactly raking in the dough even with the "double dipping" so they need to recoup money to pay expenses somehow.

The rest of the things you listed make LL exactly zero dollars. Upload fees and other sinks are money that is removed from the market, it is not sold on the Lindex as of this time. As far as not giving out more money, it's not like they have a stack of Lindens and are hoarding it in order to make USD, those Lindens were printed out of thin air by LL and with the population growing at such a fast rate there was too much new money coming into the ecomony and not enough leaving contributing to the devaluation of the Linden.

It does go in reverse too, though not to the same scale. If you tier down right after tier is due you still pay for that mont, yes, but if you downgrade to basic right after tier is due you still get the $500L till the end of your billing cycle. So my Hubby who pays quarterly will still get his premium stipend for another 3 months even though he downgraded to basic a few weeks ago.