Economy, L's and stipends....

At least they would be off of the lindex. I believe that restricting the use of basic accounts from selling on the lindex will open up a lot more premium accounts in SL. This will make LL very happy. It will also force people who have 4 different alts all basic account holders doing nothing but selling L$ on the lindex to get around only being able to cash out 2K US$ a month. At that rate, I don't think it would be that big of a deal to bump those alts up to premium.

Well, I can understand the idea of increasing the value of L$... but you do realize that removing L$ from circulation will not only increase the value... but cause you to receive less of them?

Taking money out of an economy doesn't cause it to grow.

The only real way to regulate the value of the L$ is to introduce money sinks within the world mechanics. Either a tax, premium services for a fee that *anyone* can purchase with their L$, etc. etc.

Keep in mind... not everyone is in-world for profiteering... and many of the people you want to take the stipends away from... provide you with the L$ you get now. Your L$ might be worth more without stipends... but you will have less of them.

Again... I mean no offense.

The problem with not allowing basic account holders to use the Lindex is this:

http://www.slexchange.com/modules.php?name=Currency
http://www.anshechung.com/index.php?fct=BUY_L$
http://www.ige.com/sl/linden/secondlife_en.html

They can go to a competing Market and nothing (not even a line in the TOS) can stop them from doing that, so you still have the same problem.

Furthermore, that really doesn't do anything for the economy because you still have the same problem fundamentally that you had before, you are increasing the number of Linden Dollars in circulation and they are losing value (inflation).





Whether X Number of Linden Dollars are never created, or X Number of Linden dollars are taken out of the economy and destroyed really makes no difference as long as something is done. I'll agree with that point. You would handle it by creating a sink, I would handle it by taking away the basic stipend. We are essentially agreeing that something needs to be done, but disagree on how. I'm interested to see what the new economist at LL has to say about a solution.

Here is my problem with creating a sink instead of doing away with the basic weekly stipend. You are forcing everyone to pay (through this sink) to support basic players. In my opinion, basic players should either use Lindex, or upgrade to premium, not be supported indefinately by premium account holders and content creators. Basic accounts should be a 'Hey, try SL, see if you like it' sort of thing. That's just my opinion though.

Jessica

For the record, it's not about profiteering.

Lets say you are a content creator.
You own land. You set your pricing model at 250L / Dollar.
Your in world sales are about 9,000 Linden per month meaning about 36 dollars (at 250L / dollar). Let's further assume that 35 dollars is exactly the amount of your tier per month to Linden Labs.

This means that your store can sit on a 4,096 plot of land and you can pay your tier.

Then, the price of the L Dollar moves to 300L / Dollar. Your inworld sales is still about 9,000 Linden, however, that 9,000 Linden is only 30 dollars. Your inwold sales has stayed the same, but you now have to pay 5 dollars out of pocket to LL.

You are still earning the same amount for your store, but because of the decline of the L against the U.S. dollar due to inflation, you either have to charge more per item for the fluctuation, or you have to bite the bullet and pay out of pocket because the linden is worth less than it was before.

It's not about profiteering, it's about stability.

If the L Dollar continues to decline against the U.S. dollar we will either see one of two things because people's pricing structure is based on tier (generally speaking).
1. People's Prices will rise to compensate.
2. People will switch to using U.S. dollar pricing models.

Economically speaking, stability of a currency is very important.

Jessica

I feel that the whole emphasis on 'making a real life living by playing a game' is the one thing that has ruined and cheapend the whole SL experience, and removed the focus on simply having fun. You see, capitalism is only a good thing when you're making money out of it. If you aren't, then it sucks. Not being able to afford what I want, and not having the means to do so without spending lots of $ to do so does restrict greatly my fun in game any further than as a simple social tool. That's why rebuilding an infohub has been a wonderful experience, having a 5000 sq m parcel to shape into something exactly how I wanted it to be, as something for others to enjoy and as perhaps even a lasting legacy that may be here several years after I decide to stop playing.

Whilst it is true that there are 'other outlets' to buy and sell L$, if trading them externally became a ToS offence, a few 'sting' operations and ban of the perpetrators, including wiping their land and property (and any known alts) may upset a few but it would make people think twice about taking part in such transactions from either side. You see, we don't really own any land, or L$, they remain the property of LL (just like other games), so they aren't actually taking away anything we own.

You could create a whole new class of job... undercover detectives working for LL, and as an incentive and payment get given a small % of all successful "busts". I'd be the first to sign up.

Lewis

Then cancel your account and leave. Because the very foundation
of SL is about making a profit. Otherwise land would be free and
Linden dollars wouldn't exist.

Don't let the door hit you on the way out.

It really depends on what sort of sinks you use. Any payments for any services at all tht LL is willing to take in $L would serve as a sink. The'se do not have to be as unplesant as a tax.

For instance, there have been discussions of more or less frivilous, "vanity" type services that LL could sell to people for $L that would serve as a money sink. Two that have been suggested are charging in $L for the right to use a different color for your group title and/or name than the standard one, and the ability to upload sound files to substitute for the standard IM message sound, along with the lines of standard ring tones.

Now, I have no idea about the viability of either of these ideas, but they do point dirrection that I think would be worth pursuing. That is, finding minor, probably vanity oriented services or extras that people might be willing to pay extra for as a way to soak up extra L$.

Things along these lines have already been done in other games as a way of keeping the value of curency there, (Although usually as products.) as a painless way of maintaining the value of the Linden, I don't see why something like it can't be done here as well.

Huh?

I fail to see how my response was in any way argumentative, flaming or otherwise griefing you.

Being that this is a public forum, I was simply offering a simple answer to a question that I believed you were genuinely seeking an answer to.

I was not aware that you were merely testing the potential intelligence quotient of any one specific poster.

Because this is a public forum, you may want to make your expectations as to who you would like to respond to your post a bit clearer.

A better option might be the utilization of the private personal message system.

Just a few friendly suggestions

hi dimitry!

i've been following this post. i can assure you we are looking at all aspects of the economy you've mentioned and then some. we are very much aware of the problems you mention in your post.

regards,

vasudha

Mr. Harker

I can agree with that, I just view the problem somewhat differently. I believe (factually) that although the premium stipend rate is something like 360 Lindens / US Dollar (which is high) the Basic stipend has no rate because they are gaining lindens for 0 U.S. dollars. As previously stated, they are paying 0, and getting lindens.

While individially that may not seem like much, across all basic accounts, it adds up significantly. It's my opinion, that is where the problem lies and sinks will just slow that particular problem down.

Furthermore, the free basic stipends problem actually grows with population size. (More and more lindens are introduced into the system). Perhaps an acceptable alternative would be to provide 50 Lindens per week for some fixed amount of time (1 - 2 months) to basic accounts. However, providing 200 Lindens per month for free indefinately is where I believe the root of the problem lies.

Mr. Lewis

I understand that you view this as a game, however the CEO and founder of Linden Lab's has repeatedly stated that SL is not meant to be a game, but rather, a platform for social interaction and development. While, right now, SL is still in it's infancy as a platform and lacks stability and tools to become a viable development platform, the intent of the creator of second life was not to make 'a game' This information is publically available and he has stated it many times.

Why I bring this up is because if the intent of Linden Lab's is to make a viable platform for social interaction, business, and development, then the economy of second life is a vital part of that platform. While I understand you view this as a game, SL was not designed or developed as a pure MMORPG, but as a platform. As such, a inworld, healthy and stable economy is essential unless we move to a in-world real currency. (For instance, using the real dollar in world with in-world paypal transactions).

In my opinion, the 'it's a game' mentality is what is hindering second life the most.

I came in after the price hike but before the end of the bonus, and one of the predictions was that people were going to be less helpful and social. I don't have metrics on that, but it sure helped camping chairs get popular since you weren't risking your ratings by sitting on a chair instead of hanging out with premiums with lindens to spend.

That's easy, give a month's notice of a change in the ToS so that people have the opportunity to get used to it, and then implement it. If people don't like the new rules, then they can either comply, leave, or get busted for breaking them.

I don't understand why our 'economic expert' doesn't see the problem with unlimited lifetime Basic accounts. They're chewing up bandwidth (possibly more than normal players because they're likely sitting in camping chairs for hours on end), and being subsidised, directly and indirectly, to play a game by paying accounts like you and me!

I vaguely recall a statement of something like "20% of accounts are Premium accounts". If 20% of the playerbase are paying for 80% of the playerbase to continue to play unrestrictedly, then I would say that might be a significant figure when it comes to loss, and something that doesn't need an economic genius to take action on.

Lewis

OH! i agree with that. DAMN! i really AGREE.
And this is really a PROBLEM: " They're chewing up bandwidth (possibly more than normal players because they're likely sitting in camping chairs for hours on end), "

Good point, congr.

What about doing this the other way around? Removing the basic stipend would be a one-time action, if it didn't work you can't do it again.

What about changing the stipend to twice a month, on your renewal day and 15 days after renewal, instead of once a week? That would effectively cut the stipend by 8% and spread the income out so it doesn't all hit on Tuesday, without changing the "official" L$2000 for US$9.95 deal... it'd just cut out the 'bonus months'.

Then see what effect that had...

I think that adding sinks to the economy would be nothing more than patching the real root of the problem and that is a section of the economy that can be gamed and provides Lindens (which has a selling rate of 290 Lindens per U.S. dollar) for 0 Dollars (free). Therefore, any sinks that are added that don't address that problem are doing nothing more than covering that problem. This, in its very essence, is a 'welfare' program, and it's my opinion that this particular welfare program because of the fact that it can be openly gamed is adversely affecting the economy.


That is why, I personally, would remove the basic stipend first.

Jessica

edited to fix a typo

Right. They should be able to buy land too.
If you're renting land you're not *directly* paying LL anything, but if you rent 4096 you're paying LL indirectly about the same as a premium account.
If they can't cash out through Lindex they'll cash out through IGE or make a deal with their landlord or whatever. Lindex is just a convenience and an income source for Linden Labs.

And I'll bet Anshe Chung could paypal you US$ (at, say, 10% under Lindex) quicker than Linden Labs does.

I always thought that the basic accounts were to be just that... basic. Which means a sort of trial play where you can interact with SL, but be restricted in what you can do. I like the fact that basic account holders can't buy land. Unfortunately, they can still rent. But why do we keep allowing these basic players to be able to even sell stuff in world? If you want to operate in SL like the rest of us, you should pay like the rest of us. and I don't care if they can sell their L$ somewhere else, stop them from selling on the lindex! Restrict the lindex for paying players only. Basic members can still buy L$ from the lindex, but not sell.
I like the ideas of paying for extra features like customized last names, and different colored group titles.
Here is an idea, since there are so many corporate groups in SL, why don't we create a new type of group where you can incorporate your group and open up all sorts of corporate options like the group being able to give and take money where the liability of a casino for instance would rest on the corporation rather than an individual. We could also have features to seperate the owner, supervisors, and basic employees in the group, and set wages accordingly. I think this would increase the ease of employment in SL and offer more jobs. I could easily see myself paying L$2,500 to incorporate my group. Things like this will create a sink hole, and give us something in return. a better feature! How many people are with me for being able to incorporate your groups? Should I erect an opinion pole?

We are? About the only messages I've seen in any thread lately actually talking about sinks have been ones I've posted or replies to them.

"Basic stipends" isn't a "sink", it's a "source".

sink, source, the only difference in the two is how it's used.

If the total number of lindens are 4,990 and I create 10, then the pool is 5,000. (source)

If the total number of lindens are 5,000 and I take away 10, then the pool is 4,990 (sink)

In the context of this discussion, the problem, economically, is that the value of the linden dollar is falling because there are too many in circulation ie, the 'rarity' of the linden dollar (perceived or otherwise) has decreased.

Whether you want to put less into the big pot (a source)

Or take away more from the big pot (a sink)

As long as we, somehow, decrease the amount of lindens going into the big pot.

Sink? Source? That is a personal implementation detail. My personal philosophy along with the reasons why have been pretty much detailed in my prior posts.

Jessica

sink, source, the only difference in the two is how it's used.

If the total number of lindens are 4,990 and I create 10, then the pool is 5,000. (source)

If the total number of lindens are 5,000 and I take away 10, then the pool is 4,990 (sink)

In the context of this discussion, the problem, economically, is that the value of the linden dollar is falling because there are too many in circulation ie, the 'rarity' of the linden dollar (perceived or otherwise) has decreased.

Whether you want to put less into the big pot (a source)

Or take away more from the big pot (a sink)

As long as we, somehow, decrease the amount of lindens going in the big pot.

Sink? Source? That is a personal implementation detail. My personal philosophy along with the reasons why have been pretty much detailed in my prior posts.

Jessica

*sigh*

1000 sims at roughly 195 a month (best rate) = US$195k a month of Linden Revenue.

20% of what, 125,000 accounts? 25,000, at $10ish a month (worst rate) = $250k a month.

What's the point of arguing that relatively TINY number of lifetime accounts are a 'problem' with their, 1024sqm to 4048sqm gratis land allocation. They're so lost in the noise it hardly matters. I'm not a lifer, (wish I was). Lifetime accounts are existing grandfathered agreements between LL and specific customers and shouldn't be anyone else's business.



Jessica- Please look at the bigger picture.

According to the above numbers the stipend pool would be (100,000xL$50 + 25,000*L$500) L$17.25mil. That plus and dwell income turned into camping chair handouts probably around L$20million a week. Probably around L$90 mil a month.

Do you really think that roughly 90mil MORE lindens will be bought via the LindeX each month to compensate for the lack of stipends and dwell?

Do you think even half that increase will occur?

The majority of players will just buy and rent less. The few sinks that exist will eat up their part as usual... and merchants and landlords will just get less revenue. Sure the value of the L$ might climb back up. But each merchant will have fewer to sell.

Is that really a win?

The L$ value may be sliding due to over supply, but I still say the solution is better sinks. Getting rid of ratings bonuses and the score board has effectively killed the ratings sink... and nothing has come along to replace it yet. THAT should be addressed before killing stipends.


--
(Personally, I believe the premium accounts are closer to 10% of the population not 20%)

Hmm.. I should edit out the first point of my previous post, I didn't see the word "basic" between "unlimited lifetime" and "accounts" on first pass. I'll leave it anyway.

Lewis- There is a very simple reasy why unlimited lifetime basic accounts exist:

Stores don't charge people to browse. If they did, they'd have fewer customers.

You can argue that basic's chew up bandwidth... but in RL window shoppers require watching to make sure they're not shoplifting and that's labor.

Stores issue coupons to promote sales. Linden Labs gives stipends. Granted they're paying for stipends with the value of the L$ but it serves the same purpose.

--
Jopsy

We simply disagree on the solution.

You would take money out of the overall supply through sinks.

I would personally try and restrict the money that goes in.

If we (as Argent suggested) basic accounts to a 50 stipend every two weeks and see if that helped, or if we limited basic accounts to a ... OH, I have a great idea!.

300 L / 1 U.S. dollar, 10 dollars for account creation = 3000 Linden.

We give an account 500 Linden upon creation? If they go premium they get a bonus I think, if they chose not to go premium we give them 2500 over 8 weeks every week. Roughly 312 per week for 2 months (8 weeks). That should certainly be enough time to try SL and see whether they like it and to either upgrade to Premium, or buy Lindens they would like to spend on Lindex (or other third party site).

It's the 'free money forever' that I disagree with, it makes more sense to eliminate that model than to add any sinks. At least, to me.

Jessica

I'm on basic. I rent. I effectively am paying LL -- I pay my landlord, and he pays LL, after skimming some off the top for himself. No, the money doesn't go directly to them, but they do get it.

Jessica you need to go back and read my posts. I'm on basic and I earn my keep. If I could afford to pay for premium I would but I can't. There are many basics out there that are in the same boat. We simply cannot afford it. Are you going to discriminate against those are less fortunate than you financially?? Are you going to discriminate against those who are on fixed incomes?? Are you going to sit there and tell me and all those others that we can't be in Sl just because we can't afford to pay premium fees much less land tier fees?? Who the hell do you think you are?


Not all basic aacounts were free! I had to pay $9.95 USD to get this one. It was AFTER I had gotten this account they started offering freebies. Are you al;so giong to penalize those who paid for thier accounts?? Wake the frak up people!! Cutting stipends is NOT a solution.