New Stipend Policy

If you pay Linden Lab $US then you are paying the bills. Some people just pay a larger percentage of the bills than others.

The majority of accounts are stipend-only basics who play for only a short period of time. They generally don't cash out because they don't ever get enough for it to matter. Stipends generally are not cashed out by the users who recieve them. The SL customer base is a "long tail", and this is basically punishing everyone in that tail for the actions of the few at the head.



No part of the problem with the economy was caused by there being too many content creators, nor by it being too easy to get started.

And there are some other realities, too, though. Such as "why bother with a virtual world unless it's better than reality?". Or how about "every society that's made more poor people has also made more crime?". We now have libsecondlife to worry about!



Nonsense. Arguably the current changes were only made because people were getting upset.

Isn't this business of 'how do I earn money' a left-over from all the other games where making money to buy (and raising your skills) were the be all and end all of the game.

Do real beginners need money? As has been said, everything at a basic level is available free - not to mention the incredible places like Yadni's and GNU. Building here doesn't actually cost anything. Classes are free to students (and funded by LL remember).

I would suggest that by the time they actually need to spend money on uploads and real shopping they would have learnt, as I did, how to make a little money, how to get a job, how to develop.

If this isn't the case, then they will have the choice of buying L$ - and probably spending far less than the monthly charge on most games, or upgrading to Premium - which is again cheaper than most games - 6US$ per month (on yearly payment) I still think is a brilliant deal.

As for taking stipends away from the rich, I'm totally against that - even though I'm not one of them. Why should they be punished for having money - whether earnt or bought - they pay the same fees as everyone else and without many of these people I'm sure SL would be a lesser place.

*ducks her head and waits for the fallout*

Surreal,

I am an economist by formation (although not by trade) so don't worry too much about me not understanding the mechanisms of inflation. Mentioning this just because I know that it's sometimes difficult to know how much to explain on a message board when we don't know the people at the other end. It does NOT mean I think I know better than other posters. I'm not saying that! I'm just enjoying the discussion on a subject that interests me.



As has been mentioned, SL's economy is peculiar because there is no real need for money. We don't need to sustain ourselves, buy food or medecine nor feed our families. So I believe that while your reasoning is correct (SL is printing money like some governments did during WWII) it doesn't really apply here.

Comparisons with a regular economy break down. By printing money, governments in real life were pricing people out of necessities (there are still examples nowadays of countries with galloping inflation increasing prices much faster than the salaries are majored), devaluating their money against other currencies (causing them to spend more when having to import raw materials or other products not produced locally) and entering a vicious circle where money printing engenders more money printing and inflation.

Not so in SL. First of all, nobody is priced out of anything necessary. SL doesn't need to import resources like fuel or raw materials either into the grid. So we are not generating the same kind of inflation as in the countries mentioned above.

The amounts offered are also small (enough to buy myself a few dances/clothes and or maybe a skin every month, or one AO device and a couple of anims). I believe they do more to invigorate the economy than depreciate it. they certainly do't lead to massive sales of Lindens on the Lindex by premium account of holders who have no SL source of income.

I don't have any numbers to corroborate this but I think it wouldn't be an unreasonable assumption to work on the basis that the median rate for account subscription is the quarterly one (probably lots of monthly and quarterly account holders tempered by a smaller but cheaper base of yearly subscriptions).

And so, the holders effectively pay for the lindens at a pretty fair price... Except maybe the 512sqm premium subscribers. After all, all other premium holders holders pay for the server maintenance, a tiny amount to maintain a landmass on one of the servers (cost for landmass itself is negligible. It's just geographical data in a database) and the amount of server resources they use to store their prims and traffic they generate. But they do that in their land tiers. The premium part of the account is not there to support this.

And the 512sqm holders get a slightly better deal (because they both pay for the resources and pocket monry with just their subscription). But then again, some do not settle and enjoy the stipend only, and others are enticed to upgrade to a slightly bigger tier once they realise the limitations of a 512sqm plot. So the 512sqm is more an entry level pricing for the package to hopefully get users to become more active.

Again, I do not agree that this devaluates the economy.

Oh my. Listen to me rambling.

I've said too much on the topic already. But I hope I have at least demonstrated that I personally do not believe that the money generated as stipend by LL is a negative factor on the economy or an unjustified generation of money. Feel free to disagree. I respect your opinion.

Wendel

I asked for facts and sources, your statement is not a fact.



You're wrong. Linden Lab has a vested interest in the economy being stable, they just don't seem to have much expertise in how to manage it. If the $L devalues sufficiently that content creators who pay for their land through their business either can't afford it, or don't want to afford it, then LL loses a lot of $195/mo customers. To say nothing of the customers like Anshe who will quietly sell off if they become unprofitable.

Tier is what pays LL's bills. $L cash outs pay a lot of tier. You can do the math.

The fact that "more" people cash out does not mean that the "majority" cash out.



Someone who (for example) sells a few DVDs they don't like any more on Amazon is not running a business. People would not do that if they had to worry about business tax, getting investors, etc. Likewise someone who sells some stuff they made on SL, that they made for themselves but think others might like, probably wouldn't either.



(nod) I don't have a problem with that. But as I say, when the new zero-stipend newbies arrive, we'll have to see what social dynamics they develop.



I have upgraded. I've had a Premium account almost since I started, partly for the L$, and partly because I thought SL was intriuging and knew it cost money to run. But the majority of the fun I have in SL comes from my friends and they cost me nothing. Other aspects like experimental building also cost me nothing, if I wanted to build a major structure I'd need land, but I'm not good enough to do that at the moment and it's not clear I ever will be. (I actually own the land anyway, but it might be repurposed.) The money I spend on SL is bad value for money, but my RL job is good enough I can afford it. If I was pinched for money in RL, SL would be high on the list to go.

Only LL could make these statistics available and they don't do so. But that means that your statements are equally unbacked. Yes, you are a successful content creator and deservedly so, but you're still only one data point.



Only one slight error you've made. L$ cash outs pay no tier. If they are paying tier by cashing out L$, then other people are paying that tier for them. Those are the real customers paying that $195 a month. Maybe it's time to think about what they get for their money.

I appreciate your grasp of the basics... it's refreshing.

I think there is one aspect you are overlooking. While there are no necessities, one of the reasons for the explosive growth has been content creators/land barons ablility to turn their $L into land (and RL profits)... which pays LL's bills. If those folks can't afford their land, then LL doesn't get their $US. Look at the number of private islands on the grid. Many of those, if not most, are paid for out of some kind of business. The devaluation of the $L matters to those folks... and thus to LL.

My statements are based on the statistics LL posts. Inflows outpace sinks by a lot.



You mistake my meaning. People who rely on cashing out their $L to pay for their tier. If that $195 doesn't come into their budgets, then it may not go out to LL. It's no more relying on other people than using your salary to pay your rent is relying on other people in RL.

The Question :


The answer :

I'm guessing it's the same source that says having a premium account makes you a wuss who can't make your own money.

If people stop earning Lindens and refuse to buy Lindens where does that leave you the content maker who needs sales to pay their tier? Oh I also pay tier to Linden Labs. I just refuse to play your sick game and degrade myself by selling my second life body for money!
Really, If new people get no money to buy things and the ones that are left stop buying what does that do to your economy? If people don't want to buy Lindens what does that do to the price?
Think about this the longer Second Life is on line means the more amount of content is available, unlike real life once content is made it does not have to be created again. My inventory is full of content.

So twilight zone.

I understand your point. I guess that's where we need to agree to disagree. My position is pretty much that, rather than being a devaluating force on the Linden, the stipend generates a non negligible part the cash which is then injected in the economy and allows those people who rely on the income in Lindens for their tiers to make those sales.

In a way, it could be seen as a kind of subsidies.

I'm happy to pay for my premium account and 16K sqm of land every month. But after that, I remain within budget of my stipend. Without it, there would be 2K lindens less spent every month in SL. And I wouldn't be surprised if other "consumer only" SL customers also made very little use of the Lindex. I certainly know many, although not enough to consider this a valid statistic.

So what if the stipends ended, the amount of transactions took a sensible dip and you ended up in that very situation you described too (sellers not making enough to pay for the account and tier and leaving)?

All a theoretical situation. But this whole discussion is more a study in virtual economy than a definitive answer on whether limited cash inflows are good or bad. You see, I think it's not all black and white like it might be in real life.

Wendel

Ranma makes a similar point to mine, although in a more colourful manner.

The crux is: "If people stop earning Lindens and refuse to buy Lindens where does that leave you the content maker who needs sales to pay their tier?"

I'll ignore the associated angst.

Wendel

Take a chill pill. It's not my economy and I don't really give a rat's ass what you do. You seem to contribute mostly vitriol and blather, so stop participating ... I won't notice the draft.

I've always asserted that everyone is a whore in some sense or another. 40 hours a week I sell myself to a major pharmaceutical company to get $US to pay my bills and vices.

Personally I am in the fortunate position to be able to support our private island through my RL earnings if I chose. I am also fortunate in that people like our creations enough to not make that necessary. I create for the pleasure of creation.. the rest is gravy. Chaos is our personal sandbox.

I would like to see LL get the economy straightened out. It would increase the odds that SL will survive and grow -- which means more scope for my play.

Now that said, kindly bugger off and play with your full inventory of dead horses.

Interesting points. As with everthing in SL, time will tell. Every major change has been met with "this will be the end of SL." So far, it's still around. We'll soon know if these changes are the last straw for the camel.

That we can agree on.

Wendel

The price of goods would lower and remain affordable, Just like with a surplus of L$ items are priced high, it would hold true that prices of services and goods would lower to match the buying power of the L$/usd

That's what would happen.

Which is good for people all around.

Firstly, may I just point out that There (off quoted as similar to SL) does not pay stipends. If you want money you generally have to import it.

Most other online games require a monthly payment, and that is that. You pay to play.
In SL you can play for free. FREE, nothing, ziltch, zero. And boy, can you do a lot for that!
As long as other members are happy paying to own land to put interesting things on, of course. Flipper is right, the Premium members are of course paying for the free members to play - no Premium members, no land owned, nothing to see or do there.

Interesting really, we, the 'players', pay to provide content for other 'players', who can enjoy our labors and investment for free. Clever marketing, Lindens.

Now, please, will someone tell me why no longer giving people something for nothing is so bad?

You can play SL for free, plenty to do. Or you can import currency to enhance your experience - if you so wish. Or you can invest more currency to enjoy owning your own land and potentially earing a little extra cash. Choice is yours. Still a better deal than most online games/worlds.

You are so correct, I have to play the role of the quiet supporting management in real life. So when I get on line tend to get carried away with myself OH well all of the world is my stage Perhaps I should buy an island and make it private. The general public is not allowed or permitted. No camping chairs and no vendors!

Very few people who rake it in do so easily.

I'm not really sure how to interpret your post. It sounds like you really enjoy SL, but you wish it was more affordable for the things you want to do. I can understand that. It's frustrating to have to budget your entertainment.

I'm sure you didn't mean the last sentence the way it sounded. Since you also create, I know you are aware of how much time and hard work go into making anything, especially if you then have to sell it, etc. To do so much work for such a small hourly work seems pretty insane to me at times, but the folks who do it must get a larger satisfaction than just paying their bills because there are much easier ways.

Just thought I would poke some info in here.

First off I really don't care about stips personnally. I have more important things to think about. Thinking about more important things, I think about customers that pay for their land on AzureIslands with stips. As the value get hammered on LindeX, the 500L$ isn't worth much anymore. As for 50L$, that will get you nothing on islands. So it doesn't really matter.

Another note, since they are doing this to fight inflation, I have to tell you guys it's hard to keep up with the dropping rates. I have to adjust rates almost daily now (for those who pay in L$) I get a couple of emails and IMs per day saying "Since when did you make it more $$$ here" I have to explain, in order to survive and pay bills in USD to LL we have to charge more and more L$. Also if you look at the difference between the L$ price form a year ago to now. The difference is HUGE. If you look at the USD difference... well ther eis no difference. However it looks like we are getting more $$$ L$ wise, but we actually charge the same as ever.

As for FlipperPA's comment, you don't want to see our monthly bill