Phillip's Announcement
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Lawrence Linden
Linden Lab Developer
Join date: 25 Jun 2005
Posts: 235
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07-17-2006 22:59
From: quux Coalcliff My simple question is the topic of this message - I'm not looking for snarky replies from cheerleaders or conspiracy theorists. I'm hoping one of the Lindens (Lawrence?) can just answer this question directly? Here's the super-concise-it's-after-my-bedtime version: it's a better way to inject L$ into the economy than stipends and can be rapidly tuned in several ways to improve exchange rate stability. The side effect of bringing Linden Lab some additional revenue is just a bonus. We expect the benefit of keeping a more stable exchange rate to far surpass the benefit we get from having sold some L$ on LindeX instead of as part of a Premium account. Cheers, Lawrence |
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quux Coalcliff
Registered User
Join date: 22 Jun 2006
Posts: 3
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Thanks Lawrence
07-18-2006 00:13
That's pretty much what I was looking for, and what I suspected the case was. A main reason I asked, though, was to get the authoritative answer into the discussion, rather than a million conspiracy theories.
Of course it leads to the next question, since I have only a dim grasp of macroeconomics:
Why is this small amount of cash injection into the economy better than the stipends?
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Svar Beckersted
Registered User
Join date: 14 Apr 2006
Posts: 783
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07-18-2006 00:23
From: quux Coalcliff That's pretty much what I was looking for, and what I suspected the case was. A main reason I asked, though, was to get the authoritative answer into the discussion, rather than a million conspiracy theories.
Of course it leads to the next question, since I have only a dim grasp of macroeconomics:
Why is this small amount of cash injection into the economy better than the stipends? Much easier to control the influx. |
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Lewis Nerd
Nerd by name and nature!
Join date: 9 Oct 2005
Posts: 3,431
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07-18-2006 02:09
From: Lawrence Linden Here's the super-concise-it's-after-my-bedtime version: it's a better way to inject L$ into the economy than stipends and can be rapidly tuned in several ways to improve exchange rate stability. Here's my super-concise-middle of the morning response: You are wrong. It may be "better" for a few money traders and for Linden Lab, but for the vast majority of players I think you'll find that reducing stipends has a negative affect on both their spending power, and if they sell stuff, their income from other players. You keep pandering to the 'big players' with lots of money, but without us regular, faithful, small players in large numbers, SL will fail. I note also that no warning or opportunity to discuss the issue was given to the community at large before this decision was made, further making a mockery of "your world, your imagination". The more you hurt regular players who just play your game for fun, the less attractive it becomes for your loyal, paying, regular monthly customers. Lewis |
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Patroklus Murakami
Social Democrat
Join date: 17 Sep 2005
Posts: 164
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For anyone who finds transcripts all in orange difficult to read  07-18-2006 03:33
Thanks to Gwyn's colouriser script, here is a much more readable version of the Town Hall meeting: ------------------------------------------------- Jeska Linden: Hello everyone and thank you for coming to the economic Town Hall with Lawrence Linden!Jeska Linden: First just a few tips for best enjoyment of this Town Hall.Jeska Linden: We'll be starting with a basic introduction about the new economic changes. Then Lawrence will be taking some questions. If you'd like to ask a question, please join the group Linden Town Hall Questions and ask in there - this is where we'll be pulling.Jeska Linden: questions from.Jeska Linden: Questions will be answered, as time permits, in the order they appear in the chat.Jeska Linden: Please don't submit your technical support questions, as they will be skipped over. Also, please try to keep your questions as concise as possible to allow the best flow of conversation.Jeska Linden: Also, if you've joined us here in Pooley, please try to keep your IMs and offers of friendships till the end Jeska Linden: Lawrence, take it away!Lawrence Linden: Welcome everyone, thank you for attendingLawrence Linden: Today we announced three things; a stipend change for new Premium accounts, the commencement of L$ sales by Linden Lab, and some additional, public LindeX "circuit breakers"Lawrence Linden: I'll summarize these and talk a bit more about the longer term.Lawrence Linden: For new Premium accounts the weekly stipend is reduced from L$500/week to L$400/week. Existing Premium accounts continue to receive L$500/week.Lawrence Linden: We will begin selling L$s on LindeX. Until otherwise announced we will be using an account that is at the Currency Trader 2 tier, and restricting our sales to less than 5% of LindeX volume for the preceding 30 days. Other restrictions will applyLawrence Linden: to the trading, please see the announcement for more details.Lawrence Linden: We are also adding automated market halts. Should the market move too much in one 12 hour period the market will automatically shutdown until it is restarted. The halts begin at a 10% market move and a suggested one hour cool down. Larger marketLawrence Linden: moves will result in longer cool down periods or other reprocussions.Lawrence Linden: You can find more detail in the announcement.Lawrence Linden: The primary motivator behind these changes is to get to a point where the L$ sources are dynamic instead of having a fixed ratio to the number of residents. This will make it easier to balance the marketLawrence Linden: input and output and we hope will have a beneficial effect upon exchange rate stability.Lawrence Linden: That wraps up my summary.Lawrence Linden: Let's move on to questions.Jeska Linden: Ok, I've got questions Jeska Linden: Don't forget, join the Linden Town Hall Question group to askJeska Linden: FlipperPA Peregrine: The L$ is clearly a brilliant micropayment system: not electronic CC fees and such, and a nice way to conduct low-cost payments between residents. When can we expect less nonsense about this, and just get to the fact...Jeska Linden: you've developed a brilliant micropayment system. How about showing us the REAL cost in US$ or any country's local denomination as determined by the world's market? PS: MORE FRICKIN' SINKS! Someone at LL needs to attend the Greenspan college of Econ 101Lawrence Linden: There's a project in progress to start preparing the web site to handle displaying costs that would otherwise be displayed in USD in other currencies. I don't know when it's scheduled to see the light of day, butLawrence Linden: it's being worked on right now. I'm not aware of any plans to display anything other than L$ directly in the various parts of the viewer that deals with micro-payments. Perhaps the currency buying dialog will be updated, butLawrence Linden: beyond that I can't speculate about at this time.Jeska Linden: Alenzia Epsilon: If someone cancels their premium account, then reopens it, will they recieve 400, or 500 a week?Lawrence Linden: I think they'll receive L$400/week... what matters is when their last transition from not being billed to being billed by Linden Lab for a Premium occurs.Jeska Linden: History Rust: Are the effects of large scale land speculations affecting the economy adversly?Lawrence Linden: I can speculate, but that's really not appropriate. What I will say is that land sales make up a significant part of the Second Life economy so it's quite possible for land sales cycles to effect other parts of the economy and other indicators like theLawrence Linden: L$/US$ exchange rate.Jeska Linden: Katt Kongo: Most content creators rely on the ability to sell their Linden Dollars so that they can earn a living. What effect will the fact that LL is selling $L have on that ability?Lawrence Linden: I don't expect our currency sales to have a significant impact upon the exchange rate. We're restricting sales quite a bit, and for the forseeable future there'll be a human making the trading decision. One of the highest priorities for that human willLawrence Linden: be to make trades at rates and times that they expect to make a minimal impact in the exchange rate.Lawrence Linden: Just to reiterate the volume that we'll be trading is very very small compared to the monthly LindeX volume. To put specific numbers to it, last month's total LindeX volume was over US$1,000,000Lawrence Linden: and we'll be selling less than US$10,000 per 30 days to begin with. We have no desire to shoot ourselves in the foot so I don't expect our exchange volume to ramp quickly enough to impact the exchange rateLawrence Linden: in a measureable way.Jeska Linden: Malin Arizona: Are there any plane to revive economic development on the mainland?Lawrence Linden: We anticipate that the new group tools that are due in release 1.12 will have a positive impact upon the mainland economy. Also the continued expansion of the southern continent should help continue to fuelLawrence Linden: innovation on the mainland and provide additional opportunities.Jeska Linden: Harlequin Salome: When is LL going to decide if they want Second Life to be Resident Run or Linden Controlled?Lawrence Linden: I don't expect Second Life to ever be fully at either extreme, I think of it more as an on-going partnership. There are lots of opportunities for Second Life to benefit from more Resident Leadership, and I believeLawrence Linden: that likewise there are this that as a corporate Linden Lab is better suited to for Second Life. In the long run, I think we'll generally be more biases towards encouraging the Residents in their endeavors when possible rather that doing everythingJeska Linden: Please join the group Linden Town Hall Questions to ask questionsLawrence Linden: ourselves. The whole doing-it-ourselves thing really won't scale to the future we see for Second Life. We will have to share the load where we can out of necessity and desire.Jeska Linden: Newfie Pendragon: Can you explain how, being the 'mint' of L$ in SL, that LL is creating a large conflict of interest scenario by now selling their own L$ on LindeX?Or at the very least a serious undermining of trust by those who dont have their...Jeska Linden: own infinite supply?Jeska Linden: [[ You can also IM your question to me directly if you're out of groups, I'll add them tot he queue]]Lawrence Linden: From that perspective we've been minting and selling L$ in the form of stipends for years now. This is just a migration to making the valuation of those L$ more rational. We're doing our best to be as open about the process as possible,Lawrence Linden: you're going to be able to see the total L$ sales by Linden Lab updated daily, we're telling you all what the limits are for our sales in terms of both L$ sinks and LindeX market volume.Jeska Linden: Seonaid Barrett: Does Linden-traded Lindens trade at market rate, or at a fixed target rate?Lawrence Linden: It will be at market rate. There is no "target" rate. The directives for sales will be "operate within the announced limits", "sell when the impact on the market is likely to be minimal", and lastly "sell about how much we're limited to selling in aLawrence Linden: given 30 day period" with less emphasis on that last directive. We've seen the problems that rapid exchange rate moment can cause and we'd prefer not to see that again.Jeska Linden: Rraven Moonlight: Is there to be a reinstatment of assisstance for those wanting to create quality content in SL? Cause cutting stipend is not helping us at all.Lawrence Linden: just to clarify in that last statement, I'm suggesting that we're likely to err on the side of selling substantially less than what our Currency Trader tier would allow if we feel it's necessary.Lawrence Linden: no one to that last question...Lawrence Linden: I don't have a solid answer, be there are some programs being design now that may be a boost to the creators on exceptional content. I haven't been involved in that so I can offer no details.Jeska Linden: e Brodie: Lawerence, why are there both positive methods to control the economy (circuit breakers, limited injection of funds) and world changes to premium stipend (a motivator for premium accounts) in the same economic change? Not everyone will want toJeska Linden: buy moneyJeska Linden: That's from Ice Brodie btwLawrence Linden: There part of the longer term plans. We expect to move away from stipends in the long term and towards systems that are more dynamic for introducing L$ into the economy. Thus with this announcement we're announcing some of each. Right now, PremiumLawrence Linden: account holds are buying the possibility to own land, and a regular alotment of L$. That's not that different from buying L$ on demand. We have been tossing around the idea of allowing ResidentsLawrence Linden: the option to setup recurring LindeX market buys on a customizable schedule. If there are enough residents would prefer getting their L$ in a way that resembles a regular allowance, we can certainly provide for that in the future.Lawrence Linden: This is no way a commitment to that feature at this time.Jeska Linden: Beau Perkins: Please explain how LL putting more money into the Market by producing L$ and selling it can fix the economy. Also what did Philip mean back when Lindex open by "LL will not be selling L$"?Lawrence Linden: That's not what we're suggesting, what we are suggesting is that by making the L$ injections into the economy more proportional to demand by offering it on LindeX we see the two-fold benefit of additional exchange rate stabilzation throughLawrence Linden: adjusting sell-side pressure a bit to match demand, and by helping ensure that we don't run into over supply situations like we're very vulnerable to right now with the such a large part of the L$ sourcesLawrence Linden: coming from fixed stipends.Lawrence Linden: If you provide me with more of Philip's quote for additional context I might be able to speak to that additional point. I think the reality of Linden Lab as a corporation is that when we see opportunities to improve Second Life we need to take themLawrence Linden: and sometimes that may mean altering our stance of a given subject. In this case we're trying to improve the economy in a way that we expect will benefit us, you and Linden Lab in the long term.Ctarr Huszar: by letting in hundreds of free unverified accounts thats causing havoc through out the gridLawrence Linden: I believe that we're sticking to the spirit of such a statement by pre-announcing, selling less than we take in as sinks, doing this to strengthen the economy, not as some cash-cow.Lawrence Linden: On a related note, LindeX isn't a huge income generator for us, in fact overall we lose a little bit of money on it eahc month due to fraud. But we believe that it benefit Second Life enough to justify the loss, and of courseLawrence Linden: we continue to improve our tools to combat fraud.Jeska Linden: Gigs Taggart: How will Supply Linden deal with the lag that all markets have. A sell in a strong linden market can deepen an impeding dip. What methods of dealing with potential instability of "flying by the artificial horizon" will there be?Lawrence Linden: well intially Supply Linden will effectively be one of my alts. I watch LindeX very closely and have gotten reasonably proficient at predicting the market movement. I'm going to be doing my best to "tread softly". Of course I have dream of somedayLawrence Linden: making an efficient automated trading program that optimizes for excahnge rate stability, but such a project is likely to be a long way off. For the forseeable future it will be myself or another LindeX obsessedLawrence Linden: Linden at the reins of the trading.Jeska Linden: Virtual Commons: My biggest concern with reducing stipends is a possible increase in stratification of levels. What is being done to make sure that all residents have the opportunity for a positive experience regardless of additional L$ purchasing....Jeska Linden: power or skill?Lawrence Linden: There are a lot of recently released and in-development that are likely to have a positive impact. For example, improved search capabilities should improve consumer efficiency, letting Residents find the good and services they desire at the best price.Lawrence Linden: There are other things like introducing buying into the viewer that should also be making the L$ buying process more accessible.Jeska Linden: Samuel Bishop: I listened to Phillip Rosedale in either the may or june town hall and he refused to answer the question: Is it not true LL recieves a monetary gain from selling the money that is meant to stay in a pool after paying for group fees and upJeska Linden: ...uploads and such?Lawrence Linden: Yes, from one perspective were are effectively selling some of the sinks now.Lawrence Linden: As for the "meant to stay in a pool" part, the things we're changing are basically the economic controls we have at our disposal to do our part to imrpove the economy. I think we're seeing a gradual shift in thinking as Second Life matures and ourLawrence Linden: experience matures as well. All these factors change over time, and we have to adapt to the changes. Focusing on taking money out of the system as sinks was one area that had been focused upon in the past, but theLawrence Linden: perceived value of adjusting the sources has surpassed that for the time. So right now we're working on the sources part of the equations. There are some future plans that are likely to adjust some of the sinks.Lawrence Linden: When the time is right we'll likely make additional changes. We're striving to make balanced changes when we can, but also trying not to turn too many knobs at once.Jeska Linden: Chrischun Fassbinder: How destructive are these 'circut breaker' conditions going to be when used by particular individuals who wish to shut the market down, by driving a panic as a switch, for their own manipulative gains?Lawrence Linden: That is exactly why I have no intention to reveal the nitty-gritty details of exactly how the the holds are triggered or exactly what actions will be taken. The general terms in that part of the announcement are intended to not reveal enough informationLawrence Linden: for the market holds to be gameable. We do have a process prepared and do know how we intend to respond to various market conditions, but that's a dangerous thing to fully reveal. So we had a look at whatLawrence Linden: various first life markets say about their holds and crafted a similar statement tailored to the particulars of LindeX.Jeska Linden: Gus Plisskin: Do you expect more content creators to work for RL$ instead of L$ because of the changes?Lawrence Linden: As Second Life grows there's evidences that there's more and more first life interest in Second Life. Many of the people and organizations taking an interest in Second Life need the help of content creators. It seemed reasonable to expect that someLawrence Linden: content creation will be done as part of first life contracts and paid for in various currencies. I don't think it would be a stretch to guess that portion of the overall content creation will comprise and increasing portion of the wholeLawrence Linden: for a while.Lawrence Linden: as for the impact upon the existing flow of in world commerce with a more stable L$:US$ ratio there should be no great reason for folks who use US$ in their first life to have a great desire to index their L$ prices against the US$. For ResidentsLawrence Linden: with other native currencies they may see a difference balance of equations as the US$ moves against their native currencies.Jeska Linden: Greggy Trilam: How would this Econmic change for the little guys? (people who don't make big transaction and use SL more for fun then a Business.) Over the L/ US Exchange rate will SL be Affordable for those NON business people of SL?Lawrence Linden: Compared to the cost of maintaining a SL capable internet connection and a SL capable PC the cost of some L$ spending money is relatively low. As a form of electronic entertainment the costs can be quite favorable.Lawrence Linden: The reduced stipend for new Premium accounts could be more than made up for by a US$2.00 LindeX purchase each month. And if you were to compare SL to an MMO with a monthly subscription fee, I think you'd still find a moderate amount of L$Lawrence Linden: to be quite inexpensive in comparison.Lawrence Linden: And of course if you're already paying for the computer and internet connection for another reason the costs of SL as a casual entertainment source should compare vary favorably to many other forms of commercial entertainment.Jeska Linden: History Rust and Malin Arizona ask: Is there a target rate between L$ and USD, or will the market be allowed to evolve totally on it's own?Lawrence Linden: There is no official rate target at this time. We're focusing on exchange rate stability. Sometimes that means letting the market make corrections to get closer to a rational value, other times that means countering changes in exchange rateLawrence Linden: with changes to economic inputs.Lawrence Linden: Which is a somewhat roundabout way fo saying the sometimes it's better help move the rational value toward the current exchange rate than vice versa.Jeska Linden: Stroker Serpentine: Can we expect quicker turnarounds on processing credits through PayPal? what do we get for 3.5% and $1?Lawrence Linden: I'm building a response time reporting page for the PayPal processing so that we can better track our performance. We're also putting more effort in the the automation project, and we're also building a business case to apply more human effort to theLawrence Linden: necessary tasks that are part of processing PayPal payout requests.Lawrence Linden: So yes, we hope to improve the response times. Right now we're averaging about 3 days (note days, not business days... I haven't finished adjusting the report to cound business days).Jeska Linden: Ok everyone, we've gone way over (Yeah Lawrence!) - we'll go till 8:30Jeska Linden: So time for a few more quick questions in the queue - sorry if your question was asked and we didn't get to it.Jeska Linden: we will have another Town Hall tomorrow morning.Jeska Linden: Salazar Jack: Will the Lindens being sold by Linden Lab be newly minted ones or Lindens that are collected through sinks?Lawrence Linden: The answer is rather subjective, but since we are limiting Supply Linden to selling less than the past 30 days worth of sinks, you're free to think of it that way for now. From a techinical standpoint, I will wave a magic wand and L$ will appear inLawrence Linden: Supply Linden's account. To better understand the long term strategy it will probably be best to tink of them as newly minted. That may help reinforce the idea that we're shiftingLawrence Linden: towards more of the L$ supply coming from dynamic sources such as these L$ sales.Jeska Linden: Vestalia Hadlee: Since June 1st, the SL population has increased an average of 2,076 per day. To better gauge the impact of the stipenend reduction, what percentage of the current influx become premium members?Lawrence Linden: I'm not sure. There's been a large increase in premium sign ups as the overall influx of Residents have increased. We'll look into adding it to the Economic Statistics page.Jeska Linden: Ok, last one -Jeska Linden: Caveman Dunderdale: In terms of being the 'mint' and the 'government' of SL as LL in effect is, has LL considered selling treasury bonds and allowing other SL residents to sell bonds in a bond market, to help insure the "full faith and backing of the LLLawrence Linden: It's been considered, but not something that made sense for us to act upon the last time that it was considered.Jeska Linden: Thanks for coming out everyone.Torley Linden: Jeska Linden: Sorry we didn't get thru all of the questionsJeska Linden: But we'll be back here at 9am SLT tomorrow to talk about the same topic.Jeska Linden: Also, watch teh forums for a transcript of the event. |
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Cerulia Moxie
Registered User
Join date: 22 Dec 2005
Posts: 43
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07-18-2006 04:32
I don't really know much about economics, but is this really such a problem? When I first read it I thought 'Oh no!' because of how the value dropped when the rules were changed to allow this, but when you think about it this really isn't that bad...
If they sell US$10,000 a month at let's say L$300 per US$1 (Just as an example), that's L$3,000,000 added in a month. In June there were L$50,156,550 added through stipends. Isn't reducing stipends and moving to lindex supply decreasing the amount of L$ sources, and so improving the economy?
I think their biggest problem is with a mental block against micropayments - It *feels* more like spending money than a subscription like most MMOGs have.
Maybe they should make Premium accounts which cost US$9.95 a month and gave L$750 a week... And in the background you just have those US$9.95 buy from the lindex at a rate of L$300 per US$1. Have Basic accounts which cost US$4 a month and give L$300 a week, and Free accounts which don't cost anything but don't give any L$ either.
Have land be a totally seperate thing, where you pay for tier just like you do now but it's unrelated to stipends or anything, you just add however much tier to your account you want.
So, to start with I might get a Free account, and I'm not paying anything. I explore a lot and I decide I want a house so I pay US$5 to get 512m of tier allowance added to my account (Now paying US$5 a month). Then, I find I'm seeing lots of stuff in shops I want, but I don't really like the idea of paying for imaginary money, so I upgrade my account to Basic for the L$300 a week allowance (Now paying US$9 a month). Maybe I see something that's really expensive which I just *have* to have to so I go to the Lindex and buy some extra.
The key thing is in how it's presented - Going into the Lindex and saying 'Buy this much money for this much real money' feels more like a purchase than selecting 'Upgrade account' and having a monthly fee in the background...
Well, that's just my opinons anyway ^_^
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Kelly Nordberg
Registered User
Join date: 12 Mar 2006
Posts: 116
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07-18-2006 06:05
What it is: a new contract agreement of $L annuality, or LL treasury bonds if you will.
Old contract $500L, new contract $400L a week. It's that simple. Just like you used to have to pay for basic and used to have the lifetime membership option.
However, it seems that people are more than willing to assume LL would become this money grabing moster. Of course LL could focus too much on short term profits and ruin the SL economy by overselling $L, undercutting merchants, etc. but that would be suicide.
Like it or not, it doesn't matter how well the SL economy do if LL cannot maintain a profitable business running the service, without the profit to fund inprovements, customer services, you know all the things people are complaining about, demanding LL to do something about? there will be no more bug fixes, forget about Havok 2, and you think AR and land management is bad now, wait till SL population doubles and the LL staff and infrastructure level remain the same...
If anything, I think the recent changes are signs that SL and LL is finally maturing to a resonable business model; instead of relying on investors' capital to pay the bills, to have the company make enough profit to pay the bill and necessary imporvement.
The new LL LindeX sales policy would give a tool to stablize the $L rate, stimulate the economy or cool down a overheated economy. People seem to neglect that LL can sell $0L. The boundary and limitations LL set for the amount of $L they can sell a month seems reasonable, especially considering this is the initial rollout of the plan. Things are going to be a bit tricky in the first few months, but nobody had ever implement a financial policy right the first time without adjustment down the line.
As far as the argument of: think of the little people! what about those who rely on the stipends? You know what, tough luck! Same could be said about the people who missed the boat on the lifetime membership, life goes on and if anyone expect everything in the world would remain unchange, get real!
Really people! Making another mountain out of a mole hill.
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Kelly Nordberg
~~ Maiden Guard Armory ~~
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Khamon Fate
fategardens.net
Join date: 21 Nov 2003
Posts: 4,177
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07-18-2006 06:11
From: Jonas Pierterson Not really..its still depreciating what premium means though.. with no real perks, premium memberships are gonna fall off True, premiums fell off when they didn't add anything other than the original stipend and right to own land. It's been a shaft from the beginning, just like having to recurringly purchase estate reservations. Money in LL's pockets for nothing == Premium. They're not depreciating the Premium account, they're eliminating it altogether. In a few months (weeks?) we'll all just be Bills (verified billing information used) with no recurring account fee and buying whatever lindens we want, and don't earn, off the Lindex. ByeBye == stipends Now, somebody answer my question: Where do people get the impression that this is some kind of free kiddy game like the Shockwave routines on cartoonnetwork.com?
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Visit the Fate Gardens Website @ fategardens.net
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Ricky Zamboni
Private citizen
Join date: 4 Jun 2004
Posts: 1,080
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07-18-2006 06:22
From: Cannae Brentano I'm just curious. Why is it that when somebody starts a business they suddenly lose all moral values and are guided solely by the desire to make a profit? I never understood why is that so many conclude that buisness owners would sell their babies on the open market for an extra .02 percent of market share. Do you people really think Phillip et all are sitting in smoke filled rooms twisting their evil moustaches figuring out ways to screw us? More likely they sit around and decide what they want to do to increase quarterly revenues without regard to whether they're screwing us or not... |
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Ranma Tardis
沖縄弛緩の明確で青い水
Join date: 8 Nov 2005
Posts: 1,415
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07-18-2006 06:40
From: Kelly Nordberg What it is: a new contract agreement of $L annuality, or LL treasury bonds if you will.
Old contract $500L, new contract $400L a week. It's that simple. Just like you used to have to pay for basic and used to have the lifetime membership option.
However, it seems that people are more than willing to assume LL would become this money grabing moster. Of course LL could focus too much on short term profits and ruin the SL economy by overselling $L, undercutting merchants, etc. but that would be suicide.
Like it or not, it doesn't matter how well the SL economy do if LL cannot maintain a profitable business running the service, without the profit to fund inprovements, customer services, you know all the things people are complaining about, demanding LL to do something about? there will be no more bug fixes, forget about Havok 2, and you think AR and land management is bad now, wait till SL population doubles and the LL staff and infrastructure level remain the same...
If anything, I think the recent changes are signs that SL and LL is finally maturing to a resonable business model; instead of relying on investors' capital to pay the bills, to have the company make enough profit to pay the bill and necessary imporvement.
The new LL LindeX sales policy would give a tool to stablize the $L rate, stimulate the economy or cool down a overheated economy. People seem to neglect that LL can sell $0L. The boundary and limitations LL set for the amount of $L they can sell a month seems reasonable, especially considering this is the initial rollout of the plan. Things are going to be a bit tricky in the first few months, but nobody had ever implement a financial policy right the first time without adjustment down the line.
As far as the argument of: think of the little people! what about those who rely on the stipends? You know what, tough luck! Same could be said about the people who missed the boat on the lifetime membership, life goes on and if anyone expect everything in the world would remain unchange, get real!
Really people! Making another mountain out of a mole hill. |
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ReserveBank Division
Senior Member
Join date: 16 Jan 2006
Posts: 1,408
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07-18-2006 07:24
From: Lawrence Linden Here's the super-concise-it's-after-my-bedtime version: it's a better way to inject L$ into the economy than stipends and can be rapidly tuned in several ways to improve exchange rate stability.
The side effect of bringing Linden Lab some additional revenue is just a bonus. We expect the benefit of keeping a more stable exchange rate to far surpass the benefit we get from having sold some L$ on LindeX instead of as part of a Premium account.
Cheers,
Lawrence COnfirmation, The Days of Stipend's are Over... Everybody has to buy their L$ now.. Hahahahahhahahahaha.. Muaahaagagagagahhahahahaahah... I'm rolling over laughing my azz off now... Poor Pro-Stipend Party... Those days are gone. No more free money... The L$ will now be backed by the US Dollar. |
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Lewis Nerd
Nerd by name and nature!
Join date: 9 Oct 2005
Posts: 3,431
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07-18-2006 07:31
From: ReserveBank Division No more free money... As has been repeatedly stated, stipends for premium accounts are PART OF THE PACKAGE WE PAY FOR. Remove stipends and LL have to lower the price of a premium account to compensate, otherwise there will be no reason to go premium. Then SL dies due to lack of income. A world full of unverified basics contributing nothing to SL and nobody to provide things for them to do. The mainland is a deserted wasteland with the odd forgotten plywood cube and advertisment dotted here and there. Private islands are full of people with security systems doing their own thing and ignoring the rest of the world. What makes you think that the US$ is a stable currency? From where I stand, the US$ is worth about half the value of my country's currency, and with all the crap in the middle east kicking off I can only see it falling further. Lewis |
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Ricky Zamboni
Private citizen
Join date: 4 Jun 2004
Posts: 1,080
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07-18-2006 07:32
From: Lawrence Linden Here's the super-concise-it's-after-my-bedtime version: it's a better way to inject L$ into the economy than stipends and can be rapidly tuned in several ways to improve exchange rate stability.
The side effect of bringing Linden Lab some additional revenue is just a bonus. We expect the benefit of keeping a more stable exchange rate to far surpass the benefit we get from having sold some L$ on LindeX instead of as part of a Premium account.
Cheers,
Lawrence So the plan is to phase out stipends in the near/long term, so the primary way L$ will be injected into the system is by LL selling them on the open market. That leads to the natural question, what if the exchange rate tanks again *after* you guys have killed stipends? If selling L$ is intended to stabilize the exchange rate, how do you intend to prop up a declining rate? |
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ReserveBank Division
Senior Member
Join date: 16 Jan 2006
Posts: 1,408
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07-18-2006 07:36
From: Lewis Nerd As has been repeatedly stated, stipends for premium accounts are PART OF THE PACKAGE WE PAY FOR.
Lewis Don't bet on that for any longer than your 1/yr account/contact will last. |
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Kelly Nordberg
Registered User
Join date: 12 Mar 2006
Posts: 116
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07-18-2006 07:37
There is rude, there is honest, and there is brutally honest. Sugar coating the reasons behind the new financial policy is LL's job not mine.
I'm well aware of how SL economy rely 100% on consumer pumping in RL-cash for entertainment value. Which is why I have be avocating on demand side discussions instead of the supply side.
Most, if not all the "discussions" on the economy forum were about the monetary policies: Stipends, dwell, when and if LL is going to sell $L... all supply side stuff. Every single thread turns into the same old thing: one camp claiming SL is going to hell because LL is printing "free-money", the other camp claiming SL is going to hell because LL is cutting off stipends...
At the end of the day it doesn't matter how sound the monetary policy is, if nobody wants to do anything in SL because it not fun anymore.
Nobody every want to talk about demand side: how could SL attract more users? How to encourage customer spending?
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Kelly Nordberg
~~ Maiden Guard Armory ~~
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Lewis Nerd
Nerd by name and nature!
Join date: 9 Oct 2005
Posts: 3,431
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07-18-2006 07:40
From: ReserveBank Division Don't bet on that for any longer than your 1/yr account/contact will last. I am aware of that... however I can guarantee you that a lot of people will either tier down, go to basic, or quit at that announcement. Linden Lab needs money from those playing its game to survive long-term. VC funding will not keep coming forever. Less paying players not only affects LL, it affects everyone who makes a living out of SL because less people with money to spend means less sales and less money for them to cash out. Lewis |
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Ranma Tardis
沖縄弛緩の明確で青い水
Join date: 8 Nov 2005
Posts: 1,415
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07-18-2006 07:43
From: ReserveBank Division COnfirmation, The Days of Stipend's are Over... Everybody has to buy their L$ now.. Hahahahahhahahahaha.. Muaahaagagagagahhahahahaahah... I'm rolling over laughing my azz off now... Poor Pro-Stipend Party... Those days are gone. No more free money...
The L$ will now be backed by the US Dollar. |
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Lewis Nerd
Nerd by name and nature!
Join date: 9 Oct 2005
Posts: 3,431
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07-18-2006 07:44
From: Kelly Nordberg Nobody every want to talk about demand side: how could SL attract more users? How to encourage customer spending? I've been trying to talk about it for ages, and nobody wants to. This forum is mostly full of capitalists who are only interested in a profit - the economy side - rather than the land side. We need more reasons for people to buy land, build stuff, have fun things to do, and stay - and do so because they want to, rather than because they see a way to make a profit. I think a long way towards this would be for Linden Lab to finally recognise that there is a third 'type' of player, somewhere between the spender and the capitalist, people like me, who want more land but can't afford to because everything is priced out of the market unless you either have a large group to work with and share the costs, or want to undertake commercial activity - and giving US some help for a change instead of those who have lots of money to throw around. Lewis |
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ReserveBank Division
Senior Member
Join date: 16 Jan 2006
Posts: 1,408
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07-18-2006 07:45
From: Lewis Nerd I am aware of that... however I can guarantee you that a lot of people will either tier down, go to basic, or quit at that announcement.
Lewis And Master Phillip says, "Tough Love". If people quit, tierdown, go basic, whatever, those are just the breaks. All the "New" people who sign up won't know how SL life was prior to July 2006, and they will be happy with the world as it is when they join. And the world will continue to spin with or without you. So Lewis, if you don't like it, quit. The rest of us will enjoy the new economic setup. Bye Bye.. |
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ReserveBank Division
Senior Member
Join date: 16 Jan 2006
Posts: 1,408
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07-18-2006 07:47
From: Ranma Tardis You have to have a reason for people to buy Lindens and the money is not free! It is in effect not a stipend but an annuity. The less people who buy L$, the less L$ that gets printed. And the less L$ that get's printed, makes the L$ in my pocket more valuable. So in all honesty, I hope people don't buy L$. We might get back to the days of Aug 2004 when 1000 linden dollars cost nearly US$6.00. Unlike today's prices of around US$3.00. |
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Ranma Tardis
沖縄弛緩の明確で青い水
Join date: 8 Nov 2005
Posts: 1,415
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07-18-2006 07:54
From: ReserveBank Division The less people who buy L$, the less L$ that gets printed. And the less L$ that get's printed, makes the L$ in my pocket more valuable. So in all honesty, I hope people don't buy L$. We might get back to the days of Aug 2004 when 1000 linden dollars cost nearly US$6.00. Unlike today's prices of around US$3.00. RCB without demand those Lindens do not have any value. I refuse to buy Lindens out of general principle. There is NOTHING that I have to buy to enjoy Second Life. What are you going to do with all of those Lindens? Laugh |
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Lewis Nerd
Nerd by name and nature!
Join date: 9 Oct 2005
Posts: 3,431
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07-18-2006 07:58
From: ReserveBank Division So Lewis, if you don't like it, quit. The rest of us will enjoy the new economic setup. There won't be anyone left to enjoy it unless Linden Lab stop promoting capitalism and instead consider everyone. As for the "world continuing to spin" .... without income, there won't be a world left *to* spin. The whole 'new economic setup' is only here because of the flawed analysis that the previous one was broken. It all seemed to work fine for the majority of the playerbase, and it's only a few vocal capitalists that stamped their feet because their real income was dropping that got anything done. Once LL recognise that we are all of equal value, and should have an equal say whether we own a 512 sq m plot or 10 sims, THEN we will start to see progress. Until then, Second Life merely follows sheepishly where First Life is going... right down the pan. Lewis |
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Barbarra Blair
Short Person
Join date: 18 Apr 2004
Posts: 588
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07-18-2006 09:29
Lewis and Kelly have it right on. When it stops being fun, it stops.
Linden Labs needs to make it easier to make it fun. And they need to provide some incentives for people to make it fun, because it takes a lot of hard work to provide fun for other people.
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--Obvious Lady
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Khamon Fate
fategardens.net
Join date: 21 Nov 2003
Posts: 4,177
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07-18-2006 09:43
From: Barbarra Blair Lewis and Kelly have it right on. When it stops being fun, it stops. Linden Labs needs to make it easier to make it fun. And they need to provide some incentives for people to make it fun, because it takes a lot of hard work to provide fun for other people. There you go making sense again you...YOU...
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Visit the Fate Gardens Website @ fategardens.net
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Maximillion Grant
Registered User
Join date: 29 Jul 2005
Posts: 172
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07-18-2006 10:04
From: Barbarra Blair Lewis and Kelly have it right on. When it stops being fun, it stops.
Linden Labs needs to make it easier to make it fun. And they need to provide some incentives for people to make it fun, because it takes a lot of hard work to provide fun for other people. And the fun is provided in large part by the content creators which is why is why it is in LLs best interests to keep the Linden value stable. As thousands of new accounts are created weekly without a starting balance or stipends the demand for Lindens will continue to grow. We've already started to see the effects of this (the Linden going from 330 to 300ish). These changes will allow LL to much more easily control the influx of new money into the economy and helps to keep LL profitable (if they even are yet). If they don't make money SL goes bye bye and all this talk of economy is just moot. |
