Where will mainland prices go to ?
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Starbuckk Serapis
Registered User
Join date: 10 Nov 2006
Posts: 114
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12-31-2006 01:37
If you run the numbers you'll see why LL has no problem keeping land prices high. As someone pointed out, SL land is VIRTUAL. Enough COULD be created to meet all demands and put the land vultures out of commission. But they won't. Here are some figures for you:
Exchange rate: USD 4.05 per L$1000. Land prices: Low around 15L per sqm. MOst land selling around 20L
Cost of an entire mainland region:
@15L: 15 * 65536 * 4.05 / 1000 = 3981.31 @20L: 20 * 65536 * 4.05 / 1000 = 5308.42
The last couple mainland sims that auctioned went for around 3500USD. A private island costs 2500 USD.
Cost of land on a private island:
2500 / (65536*4.05 / 1000) = 9.4L
These numbers tell the whole story. Keeping mainland prices high by restricting land pushes more people toward buying islands as well as push the revenues received from the now rare new mainland regions higher. Mainland sales beyond the initial region auction do not benefit LL. Island sales do.
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Mike Westerburg
Who, What, Where?
Join date: 2 May 2004
Posts: 317
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12-31-2006 02:51
From: Jenn Burks lol, I just got done with a Macroeconomics class.......I could actually answer this with a bunch of econ terms!
But really, it's a demand and supply issue, just as in RL. There is such a huge demand for land, and the supply is so little, that the prices will go up.
Really, the demand has to go down.....or people just need to WAIT to buy land or the price will never decrease.
Or LL can issue a large amount of first land but I don't think that will happen.
Prices will go as high as the market will bear. As long as someone is willing to pay out the nose for land, prices will skyrocket.
Just wait, prices will go back down!
Jenn Have you ever opened the world map and checked the box that shows land for sale? Do that, then zoom out and watch the map get flooded with the Land for sale indicators. There isn't a supply problem here. There appears to be many parcels for sale. Then zoom in a bit more and look around at all the plots in the bluish color, those are plots that are ready for the auction block. This does not show the land that has been sitting abandoned though. Supply is not a problem. Demand is not a problem. This does not take into account the large supply of rental property that is contained on private islands, at which no one has to have a paid for account to rent from. Most likely problems: 1. Becoming a land speculator is actually one of the easiest things to do in SL that can generate revenue. All it takes is a bit of RL investment money and you are swooping up land like mad, then flipping it over for a profit, less work than being an escort or copy-botting something. Of course we are going to have a large influx of wannabe land barons. Not much work involved if all you want to do is grab land, set it for sale at a higher price and plop a free for sale sign on it. 2. Most things in SL take a lot of time and skill to work with. The freebie reseller phase is fading, the script stealer phase seems to be fading, the texture stealing phase seems to be fading, so land speculation is the current "in" and many people want to be a part of the action. 3. The publicity that SL has had in the business world, focused around the financial aspects. The 1st question I was asked when I met a new resident used to be, "How do I build?" The new question is "How do I make money?". Of course SL is going to get people who want to milk this apparent "cash cow", the problem is that many are not willing to learn good milking techniques. Sure, just yanking (being a land flopper) will make you money, but it makes the cow mad and sore. What is needed is to learn to be gentle with the cow, add more services to land flopping, actually develop the land with a house and landscaping or adding other services, perhaps even renting the land out. As for the topic. The prices will crumble to their knees at some point, and when it starts, no one will have the power to stop it, short of pulling the plug. It may have a warning sign like huge tracts of land are all of a sudden abandoned in rapid succession as many of the land floppers seem to buy from each other more than anyone else. ( There were a few plots of land in and next to my sim that went up for sale, the first 3 to 4 times they sold, they went to another land flopper each time who upped the price) I imagine that land prices falling to 3 to 4L$ per sq meter is probable as the situation develops. Another thing that I have noticed from people, many do not know when to cut their losses and run. I imagine most will hold onto that dear plot of land to the very moment their tier kills them and they have to choose between eating or owning virtual property. At that point, it will most likely be abandoned and plopped on the chopping block, or sold at a very low and appealing rate just to get out from under it. After the land prices crash, I imagine the Linden value would get a bit stronger due to the cut offs that were implemented and the sudden demand for more money as land prices drop, Bob and Susie can now afford land so they buy money for it off of the Lindex, we must take into account the stipend reduction, basic free accounts get 0, I still get my 500L$ each week, the next lowest is 400L$ then 300L$, less available money so the Linden value will remain strong, especially with the influx of new or returning residents that have heard about the low property prices. But alas, we are an interesting bunch. After about 6 months to a year, we will not remember the lesson we learned and this same situation will be upon us again, perhaps the best thing to do is wait for the crash, buy up land then wait for the land floppers to come around the bend again then we too would be able to cash in, pending we can notice the signs all over again. Agree, disagree, it is up to you. It is the last day of 2006 and I am gonna party like it is 1999.
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Elanthius Flagstaff
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Join date: 30 Apr 2006
Posts: 1,534
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12-31-2006 04:53
From: Mike Westerburg I imagine most will hold onto that dear plot of land to the very moment their tier kills them and they have to choose between eating or owning virtual property. Hilarious, how long do you think people can pay $70 a month before they have to worry about eating? The answer is forever. Even if you're paying $300 a month in tier and making no money at all from sales most people with decent jobs could eat that for a couple of months before they started to worry. This idea that people are going to panic over their tier costs and start throwing away land is ludicrous. The cost to hold land is minuscule. It's much more likely that profits will dry up and people will throw away land because they're bored of land trading. There's not going to be a crash, there's no reason for one. The best you can hope for is a gentle decline in land prices as LL bring more sims online. As for the idea that more people will buy lindens because land is cheaper. I'm no economist but my gut tells me that money will only circulate faster and it will have no effect on the LindeX since the buyer of the land and the buyer of the money will be matched with the self same seller of land and seller of money.
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Broccoli Curry
I am my alt's alt's alt.
Join date: 13 Jun 2006
Posts: 1,660
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12-31-2006 05:55
I'm sure the panic started by the Lab about a month ago of "we've only got 150 islands left before there won't be any for a while, because we're moving over to class 5 servers" didn't help things. It was, frankly, a badly timed and badly worded announcement by Zee Linden, who so far only appears to be upsetting the SL community at large. What may have been a 'good run' for Linden Lab, by making a load of people buy a server perhaps a month or two earlier than they would have wanted to, and bought in some obviously needed cash, has screwed a lot of people and may well have done more long term damage than they realise. Sure, 'signup' numbers keep storming up, but out of the 10% who log in more than a couple of times (of which a large part are probably griefers and underage kids), I'd say most of that 10% are actually alts of existing characters, rather than actual new people, and thanks to the "unverified signup" there's no way to actually tell who's who unless they provide details. There's also, of course, the "first land reseller alt" infestation to contend in to things. The best parallel here is fuel prices. After Hurricane Katrina, US fuel prices rocketed thanks to hype and a temporary loss of production. It all soon recovered and things went back to the "normal" price that people had been used to. I predict a very similar thing happening with land very shortly, and a lot of people are suddenly going to find that few hundred dollars worth of land they bought because they thought prices would go up further are suddenly worth a fraction of that price - exactly where the prices should be. I don't know if anyone's ever searched to see how many posts Zee Linden has made on the forums, but I just did - "sorry no matches". Glad to know we're important. Broccoli
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Starbuckk Serapis
Registered User
Join date: 10 Nov 2006
Posts: 114
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12-31-2006 10:56
From: Mike Westerburg Have you ever opened the world map and checked the box that shows land for sale? Do that, then zoom out and watch the map get flooded with the Land for sale indicators. There isn't a supply problem here. There appears to be many parcels for sale.
This is not actually an accurate guage of available land. If you look closely, many of those parcels are not really intended for sale. You will find 100's of 16mb and larger parcels priced at 999,999,999. Prices of this amount are not meant to be sold. The for sale flag is set so that they appear in the search window and on the map. Nothing more. To truly guage "availability, you need to discount these parcels. On your later comments, I do hope you are correct. Land speculators have flipped land into the stratosphere. I do hope the bubble bursts and they come back to virtual Earth soon.
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Raymond Figtree
Gone, avi, gone
Join date: 17 May 2006
Posts: 6,256
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12-31-2006 11:34
From: Gorden Flossberg By End of November, the cheapest mainland was available at around 8 L$/m. Now, 30 days later, the cheapest mainland costs around 14-15 L$/m ! This is an increase of around +85% in only one month! Today it's 16 per meter for the crappiest mainland. Get it while it's this cheap!  But seriously, it won't go much higher. I say a good day to check back is Jan. 15. If prices are still this high, it means all those holiday bills did not affect the economy and that only a change in LL policy will cause a bursting of the bubble.
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Raymond Figtree
Gone, avi, gone
Join date: 17 May 2006
Posts: 6,256
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12-31-2006 11:48
I think the only greedy land buyers are the ones who slice plots into little pieces and sell them for others to place ugly signs or ads on. These devalue the surrounding land and make SL an uglier place to play in.
The rest of the land brokers INCREASE the value of the land around it when they increase the price of a plot and are just getting what the market will bear. If they try to be greedy, they don't make a penny. They also have to pay expensive fees to Linden Labs. The more they pay, the more they can affect the market, but even the folks with the biggest tier fees don't make a dent with their buying and selling.
If you are looking for someone to blame, look to the LL "gods" who can change policy, prices, tier structure and land availability any time they feel like it.
Or you could kick yourself for not buying land at 14 a meter three days ago. It would be worth 16.5 today.
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Mike Westerburg
Who, What, Where?
Join date: 2 May 2004
Posts: 317
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12-31-2006 12:59
From: Starbuckk Serapis This is not actually an accurate guage of available land. If you look closely, many of those parcels are not really intended for sale. You will find 100's of 16mb and larger parcels priced at 999,999,999. Prices of this amount are not meant to be sold. The for sale flag is set so that they appear in the search window and on the map. Nothing more. To truly guage "availability, you need to discount these parcels.
The thing is, they are still for sale, no matter the cost, even if one does not intend to sell them, anyone who wishes to drop a large sum of cash could buy them. If the plots were placed for sale only to show up in the search, then I might say LL needs to do something about that as it is baiting the search.
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Mike Westerburg
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Join date: 2 May 2004
Posts: 317
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12-31-2006 13:08
From: Elanthius Flagstaff Hilarious, how long do you think people can pay $70 a month before they have to worry about eating? The answer is forever. Even if you're paying $300 a month in tier and making no money at all from sales most people with decent jobs could eat that for a couple of months before they started to worry. This idea that people are going to panic over their tier costs and start throwing away land is ludicrous. The cost to hold land is minuscule. It's much more likely that profits will dry up and people will throw away land because they're bored of land trading.
That all depends on the RL job a person currently has. Any time spent watching TV will show the "So you want to make more money?" commercials all the darn time. People are constantly getting the impression that there are better systems out there, SL has sort of become one of those systems. Here is another part to the equation I overlooked, a community of 1,000 people cannot support the career paths of 500 real estate agents. A person working at McDonalds for minimum wage will have to choose between food and their "So you want to make more money?" system. From: Elanthius Flagstaff There's not going to be a crash, there's no reason for one. The best you can hope for is a gentle decline in land prices as LL bring more sims online.
There was no reason for the tech crash other than, guess what, "So you want to make more money?" systems. When does anything perform a gentle decline these days anyway? In the modern era, everything is dramatic. I do hope there is no crash or I do hope for the gentle decline, either way, it is going to be interesting to watch this pan out. From: Elanthius Flagstaff As for the idea that more people will buy lindens because land is cheaper. I'm no economist but my gut tells me that money will only circulate faster and it will have no effect on the LindeX since the buyer of the land and the buyer of the money will be matched with the self same seller of land and seller of money.
Oh, I agree, my comment was just one of multiple possibilities for the Linden value remaining strong. There are many vectors for this, but the main one is the stop circuitry LL has put into place to prevent a "run" on the Lindex, they will close it down and let the conditions cool before there is too much loss.
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Something Something
Something Estates
Join date: 26 Sep 2006
Posts: 121
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12-31-2006 14:17
From: Desmond Shang Short term greed is pretty stupid. The best customers are those that have been around ages, are going to be around for ages. And they remember how various land barons act. So those that overcharge during this little christmas rush bubble are going to feel the pinch later, when it's a buyer's market. Personally, I get kinda nervous 'the other way' - when a new player rushes in, and wants to have a whole sim for any price. I've seen what happens in these cases too many times before, and it's not good for anyone. Certainly, if you're renting to tenants, short-term greed can backfire, even in a financial sense, because long-term existing tenants usually generate fewer customer support issues than newly arriving ones, and time (your time) is money. On the other hand, for those who merely flip land and don't have a long-term relationship with their customers, I suspect short-term greed can be very profitable. It's not entirely clear that the price increases are a bubble. Remember that Linden Lab's servers run hot 24/7 and consume far more electricity than a typical web server. LL cannot use blade servers for this reason. Philip Linden gave an audio interview on this point some weeks ago ( http://www.youtube.com/watch?v=ttOw5SMmm9g ). Data centers typically concentrate huge consumption of electricity into a small geographic area. It is entirely possible that LL's available space and electricity within their data centers is being rationed by the companies that run those data centers, with the result that LL cannot bring on new servers quickly enough to keep land prices stable as they have in the past. The island price increase may in fact have been motivated by such considerations. It's difficult to quantify this exactly, and it's also difficult to quantify the precise demand for land purchases. But even though you can divide "two million users" by about a factor of ten or more, the number of users is growing and demand is evidently outstripping supply at this point. And supply may be rationed for the forseeable future. Not everyone who wants land will be able to get it. This is not a permanent situation, naturally. The very first vacuum tube computers made the lights of an entire city dim briefly when they were switched on, and they had less computing power than a modern solar-powered pocket calculator. In the long run, this is a solvable problem... but it will take the next generation of servers to solve it. Running LSL on Mono certainly won't hurt either, if that ever comes to pass. Whole sims do have a certain value, by the way. Large projects can be done on them, including future projects that are impractical given current SL limitations. However, once a mainland sim has been chopped up into a hundred 512 sq.m. plots it's like Humpty Dumpty. The current subdividing and flipping frenzy is probably driving whole unsubdivided mainland sims to extinction, so their future rarity may give them a certain long term value, especially if mainland tier durably stays lower than island tier. The real bubble is not land pricing, but the "X million users" hype bubble. If there is a strong backlash that leads fewer new users to try or join SL, or if the worst case scenario happens and SL goes the way of There or Sims Online as a half-alive ghost town, then certainly lower land prices will happen but they will be the least of our economic worries. If SL continues to thrive as the premier virtual world with the most mindshare, then land prices are likely to remain durably higher than the L$6 / sq.m. we took for granted until recently.
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Desmond Shang
Guvnah of Caledon
Join date: 14 Mar 2005
Posts: 5,250
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12-31-2006 14:52
From: Something Something The real bubble is not land pricing, but the "X million users" hype bubble. If there is a strong backlash that leads fewer new users to try or join SL, or if the worst case scenario happens and SL goes the way of There or Sims Online as a half-alive ghost town, then certainly lower land prices will happen but they will be the least of our economic worries. If SL continues to thrive as the premier virtual world with the most mindshare, then land prices are likely to remain durably higher than the L$6 / sq.m. we took for granted until recently. Quite agree about the 'X million users' hype bubble. I have a confession to make. I'm a There.com refugee; a beta lifer over there. Many of us saw what happened with the economic policies at that service. They are a fine service, but honestly there is a single overwhelming reason why Second Life prospered and There.com didn't. Intentionally raising prices on the Second Life grid is a long, deep step in the direction that service took in 2004. Major, major, catastrophic mistake. The next 60-90 days will be critical. All those new users we gained, *not* the Company, will form a consensus on what land will be worth in the next few years.
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Prospero Frobozz
Astronerd
Join date: 10 Feb 2006
Posts: 164
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Chopping up parcels
12-31-2006 16:50
<i>I think the only greedy land buyers are the ones who slice plots into little pieces and sell them for others to place ugly signs or ads on. These devalue the surrounding land and make SL an uglier place to play in.</i>
That drives me nuts.
I had 32 square meters left in my tier, so I deliberately bought a couple of those little squares and put trees in them -- doing my small bit against urban blight.
All those rotating signs for various adult businesses... they make the whole place look ugly.
I sold back one of my squares to the guy who owned the land right next to it a couple days later, for exactly the price I bought it for. I noticed he'd managed to buy all the others, and I liked the idea of it getting merged with the larger lot.
These 16 m^2 suqares go for $300-$1000, depending on where they are. The ones next to the road tend to be listed for $1000, and I think they do sell. Ugly sign pollution; it makes our freeways ugly in RL, and it makes them ugly in SL.
In any event, but chopping up roadside land plots this way, I suspect that the land barons make a *huge* profit. They more than earn back the FL fee by selling just *one* roadside plot, and then all the rest is gravvy. And the whole thing is ugly.
I'm guessing the FL exploit will go away somehow. It might be fixable just by limiting alt accounts, and by making FL not resellable for at least (say) two months.
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Prospero Frobozz
Astronerd
Join date: 10 Feb 2006
Posts: 164
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Land is a real resource!
12-31-2006 16:56
To those of you who say: virtual land is virtual, and you can always create more of it : that's not right.
The whole economy of SL rests on a dubious basis, since it mirrors the RL economy. In RL, at least until 5 or 10 years ago, the concept of "intellectual property" was enforceable since it cost a lot to make the physical copies needed to transmit the intellectual property. In SL... copies are always free. And, yet, by having "copy" flags, the infrastructure is set up in an attempt to mimic the RL.
Basically, in RL, the scarcity of physical resources was taken advantage of in order to provide economic rewards for the scarsity of creators. In SL, I can't really see this working long term. Yeah, CopyBot was mostly hype, but the very nature of the world is that there are basically no costs in distirbution of goods. What is really scarce is the good creators and designers-- the people who produce what we call intellectual property. Ultimately, though, that concept is somewhat artifical in a free-copy world like SL, and I can't really see it surviving long-term. (CopyBot was just the beginning.) If creators are to receive compensation for the real value they add, some other form of ensuring payment will have to emerge, rather than continuing to enforce restrictions based on a model of another world (and, indeed, a model that is slowly becoming obselete even in that other world).
But all of that was a tangent. The point is, Land really is a scarse resource! And not just because Linden doesn't create more of it. What land really represents is server capacity. The fact that prims are limited by square meterage of land is part of that; if scripts, number of avatars present, etc., were also limited by square meterage of land (which would make sense), it would be all of it.
It costs Linden money to put in new servers to make more land. As such, they can't "just create it." If they did, they would be subdividing the resources used for the exiting land, and *everything* would slow down.
So land is a real and scarce resource in SL, whether you call it land or whether you call it server capacity.
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Prospero Frobozz
Astronerd
Join date: 10 Feb 2006
Posts: 164
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De facto zoning
12-31-2006 17:00
Somebody asked about zoning.
On the mainland, I don't think there is any zoning at all. People buy land and do whatever they want with it.
De facto zoning comes when some third party controls the land. If somebody manages to own a large part of one sim on the mainland, and then rents it out, or sells plots in an estate with a covenant, they can enforce some zoning.
There are also folks like Otherland, who have large numbers of sims, and who "zone" the whole palce just for "residential." (In other words, they have zoned it to stay looking good, and to avoid having an excessive load on the server. I'm not really sure why people buy beds for their SL houses, and the term "residential" seems a bit odd. Your home in SL is more like a "home page" on the web than a place you live... but, then again, I've got a home with a nice quaint building on it, so who am I to talk?)
I like this model. If other groups like Otherland can put together lots of adjoined sims that they control and have a convenant on, then de facto zoning can pop up. The mainland can be the free-for-all chaotic unzoned fun zone that it is, and other places can be zoned however the owners want them to be. Presumably some sort of supply and demand will help govern how well people do in finding land on these other places.
(And, of course, there are Islands, which are effectively zoned by those who own them. Howvere, they're also isolated. The mainland all connects to each other, and all the sims of Otherland all connect to each other. With teleporting, it's not such a big deal to be isolated.... but it is sometimes fun just to fly around and see what is near where you are right now.)
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Raymond Figtree
Gone, avi, gone
Join date: 17 May 2006
Posts: 6,256
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12-31-2006 17:07
From: Prospero Frobozz All those rotating signs for various adult businesses... they make the whole place look ugly.
You should contact Mister Arrow and join the Arbor Project group. They are dedicated to reclaiming small plots and planting trees on them. The only requirement for membership is the promise that you won't cut up and sell plot under 512 meters. Thanks for your efforts on this already!
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Desmond Shang
Guvnah of Caledon
Join date: 14 Mar 2005
Posts: 5,250
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12-31-2006 17:22
From: Prospero Frobozz In any event, but chopping up roadside land plots this way, I suspect that the land barons make a *huge* profit. They more than earn back the FL fee by selling just *one* roadside plot, and then all the rest is gravvy. And the whole thing is ugly. Once upon a time, before private islands, before a large grid, a 'land baron' was someone who won large chunks of land at auction. Then parceled them out for a profit because there was *very* little remaining land for sale not owned by land barons. I'm not a fan of buying up all existing land just to profit. It's not a service anyone wanted; more like it was something that nobody could prevent from happening. But at least there is a tad more vision and style to having evil, globalist plans - and *no* style to being a neighbourhood extortionate pest 16 square meters at a time! It's the difference between a Bond villian, and a juvenile delinquent thug.
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Something Something
Something Estates
Join date: 26 Sep 2006
Posts: 121
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12-31-2006 18:25
In recent days, LL has closed off the entire western coast of the snow sims area. Take a look at the Map... from Io in the north to Froumo in the south, each sim now has an as yet "Unnamed" neighbor to the west that makes up a brand new coastline. That may be a signal of LL's intent regarding how much more mainland they'll be making more of. Unless they're planning to start a brand new continent somewhere... perhaps with island-like tier. SL's ultimate fate will likely be determined by neither LL nor the users, but by whether or not a viable competitor shows up during the next couple of years. And here LL's prospects actually seem fair. Microsoft and Google will probably not touch this space. First of all because they are in a search engine server capacity arms race and the very last thing they need is to dedicate data center space and electricity and air conditioning to virtual world servers that run the CPU hot 24/7. And second of all because user communities need to be highly motivated to be willing to put up with all the clunky limitations of current virtual world technology, and this includes a disproportionate number of folks looking for things they can't find in RL, in some cases because they wouldn't be legal, and that's always a fun thing for a large company to try to explain to its shareholders. Even There won't go... there. Competitors will probably try to stay PG-13, which leads to lower user numbers. Sex, porn and adult themes are major factors in early adoption of new technologies while they're still expensive and clunky, all the way back to VCRs, "high-speed" 9600 bps modems and early BBS systems, "high-resolution" 800x600 video cards, and the early days of the traditional 2D Internet. Only later on does the big mainstream payoff come, and that's when you get your YouTubes selling for billions... but without the seedier beginnings, the flowering of the mainstream applications probably doesn't happen. To put things in perspective, 512 sq.m. still costs less than a dinner for two in many cities, and for us to buy and operate a dozen islands still costs far less than the franchise fee and startup costs and operating costs (and employee wages and benefits, and mountains of regulatory paperwork) for even a single Subway sandwich store or a neighborhood donut shop. Even the biggest barons within SL are just small businesspersons in any RL reckoning. I honestly don't see the next 60 to 90 days as being critical from a land or island pricing point of view. On the contrary, Zee Linden's gambit already appears to have succeeded beyond probably even his own expectations. Maybe it will even be a business school case study some day... curse his grasping mercantile heart  The dark clouds on the horizon in 2007 include companies like American Apparel finally figuring out that it's not particularly worth their while to do PR "firsts" anymore since the media doesn't care about that anymore, which I think will mostly be bad news for MoU and ESC but not necessarily for LL. But the biggest dark cloud is the neverending technical glitches from the gang that couldn't code straight -- that's what did in Friendster, which was supposed to be the billion-dollar company that latecomer MySpace turned out to be. The "firsts" will disappear from the media, but there will undoubtedly be new stories to replace them. Maybe a delicious scandal or two... some Senator caught up in ageplay. They say there's no such thing as bad publicity... it certainly didn't hurt Grand Theft Auto. Remember, after the database hack in September signups actually picked up significantly and haven't let up to this day. Even the grey goo attacks generate what amounts to endless free publicity. And local newspapers in every city love the local boy/girl success stories... you've read them a hundred times before: "Joe Smedley of Peoria earns 60 thousand dollars a year selling aadvark lingerie. But it's all virtual! Joe, who goes by Brztfsplk Oddlindenname, ..." We'll get economy stories, stories of how people met in SL and got married in RL... just go through your newspaper clippings from 5 to 7 years ago, where everything old suddenly became newsworthy merely because it took place on the Internet. We're in for another cycle of that. In other words, the PR and publicity machine will keep rolling, users will keep trying SL, the signup numbers will hit 3 and 4 million and will continue to be swallowed whole by the media for a while yet... in short, it's all good  And land prices will be like oil... they may fall some from the peaks they reach, but we're in a new era and it's not much use pining for the good old days and good old prices.
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Usagi Musashi
UM ™®
Join date: 24 Oct 2004
Posts: 6,083
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12-31-2006 19:03
Freebie account don`t turn into paying and land owners...............maybe 5% at most.........besides. Most people rent.Maybe its time for LLabs to stop giving land to tnew paying accounts it indded the case
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Desmond Shang
Guvnah of Caledon
Join date: 14 Mar 2005
Posts: 5,250
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12-31-2006 21:31
From: Something Something I honestly don't see the next 60 to 90 days as being critical from a land or island pricing point of view. On the contrary, Zee Linden's gambit already appears to have succeeded beyond probably even his own expectations. Maybe it will even be a business school case study some day... curse his grasping mercantile heart  The dark clouds on the horizon in 2007 include companies like American Apparel finally figuring out that it's not particularly worth their while to do PR "firsts" anymore since the media doesn't care about that anymore, which I think will mostly be bad news for MoU and ESC but not necessarily for LL. But the biggest dark cloud is the neverending technical glitches from the gang that couldn't code straight -- that's what did in Friendster, which was supposed to be the billion-dollar company that latecomer MySpace turned out to be. Zee Linden's gambit has done exactly what they knew it would do - for the short term. In fact, if they never released another sim, I can even give a pretty good guess what demand would be like in sixty days. Perhaps I shouldn't complain? On the short term, the 14 sims I have are now *all that much more valuable* and my competition is crushed before it is even born. But at what cost? Land ownership = user retention. A no-brainer that the Company has known ever since they began the First Land program. We can all do the math from there. So yes, I stand by the next 60 to 90 days as being quite critical. I'll be a bit bold, and make an 'if I were them' statement: the first thing I'd do, is try to get first land in the hands of as many new users as possible, above just about any other priority. From: Something Something And land prices will be like oil... they may fall some from the peaks they reach, but we're in a new era and it's not much use pining for the good old days and good old prices. And like oil, land prices will cause incredible, damaging shocks to the entire economy if unstable. Happy New Year, everyone.
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 Steampunk Victorian, Well-Mannered Caledon!
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Raymond Figtree
Gone, avi, gone
Join date: 17 May 2006
Posts: 6,256
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12-31-2006 22:44
Hey Something Something,
I dont know who you are in SL, but thanks for the very insightful posts. I learned a lot and agree with what you are putting forth regarding the PR hype which has been pretty astounding, only because it's all new to the public. The news is getting old, but the stories have done their job...a coworker said he HAD to join SL because all his myspace buddies defected here. I think word of mouth will take it from here and everyone will find a RL mentor to initiate them. Then once they discover the mature poseballs, they'll understand the "goal" of the game. then they'll tell two friends (letting them figure out the poseball part for themselves).
I think only the horrible performance of the game and the insufferable lag can kill SL now. Hope they are putting resources towards making a better user experience between all their efforts to give us new and exciting ways to take snapshots.
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John Horner
Registered User
Join date: 27 Jun 2006
Posts: 626
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01-01-2007 04:46
http://www.techweb.com/showArticle.jhtml?articleId=196700916This particular article is a bit thought provoking because it indicates that Second Life may go mainstream and develop a momentum of its own, powered by the big real life corporations who see marketing opportunities within the 3D web space Second Life may well evolve/metamorphose into. In turn this may well bring about a quantum change in the demographic social/economic make up of Second Life residents, perhaps evolving from what I call the “Anshe Chung” model of business practice, (That model is best defined as start small, put no capital in, build/grow slowly, and absolutely separate and hide your real life identity from your Second Life customers) into both corporate and personal activities not separated from first life. The link above identifies real life companies advertising in Second Life, in addition I note this platform has been used by US politicians and lawmakers publicly identifying themselves to canvass votes and offer opinions on virtual taxation. The UK (my country) is not far behind. In the UK the average weekly pay is around £447 (around $871 US) and in the US it is around $676. (source US Dept of Labour and UK Office National Stats) (US figures exclude higher paid workers as it is for production and nonsupervisory workers on private nonfarm payrolls, seasonally adjusted) On that basis I do not see how the payment of say $70/$100 US (UK say £50) per month on entertainment is such a big issue Mike Westerburg’s comments about the MacDonalds worker seeking the next get rich quick scheme and making a choice between eating and Second Life premium membership do seem a tad outdated, Desmonds Chang’s views may have some merit but only if the Second Life population average social/economic class does NOT change from the classic early adopter model. I am more inclined to agree with Something Something with one proviso, which is in a new Second Life model you may need to link your Second Life existence more closely with your first to prosper in a business model. After all in the future many people may feel reluctant to shell out hundreds of dollars on buying a product from a person they cannot identify in real life. It is called “brand awareness” Finally though I still stand by the comments I made in another thread about PE ratios and land costs, that is to buy land at current prices I would need to see the chance of a decent return on equity or an experience equal to that of the current 2D web. We will have to wait and see if Linden can provide that Regards John
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Broccoli Curry
I am my alt's alt's alt.
Join date: 13 Jun 2006
Posts: 1,660
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01-01-2007 05:28
Spending $70 a month is a big issue when you've been used to paying $40 and worked accordingly.
You have to remember that not everyone here is capable, or has the time, or skill, to make money. Some people, sure, they cover their tier each month and make a reasonable amount of profit - but the vast majority are not. What we see is the paying 10% subsidising the unpaying 90%, and that problem is only going to get worse as more and more people tier down and decide it's just not worth trying to provide a quality product or experience when all people want to do is sit in a camping chair and get paid for doing nothing. Try finding an event that isn't a "best in ..." or "*.ingo" competition. They're very few and far between. Seems like "thinking" is an ever reducing commodity in SL as well. Broccoil
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~ This space has been abandoned as I can no longer afford it.
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Finora Kuncoro
Impish Stoic
Join date: 11 Dec 2006
Posts: 213
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01-01-2007 05:51
From: Usagi Musashi Freebie account don`t turn into paying and land owners...............maybe 5% at most.........besides. Most people rent.Maybe its time for LLabs to stop giving land to tnew paying accounts it indded the case I'd disagree with your first statement. You have no way of confirming what % of free accounts turn into premium and become land owners. I'm an example of just that. I'm one of those myriad of reasons (economic and behavioural), that is driving up land prices. I could rent, but had a desire to own my own piece of SL. Land prices are what they are. I think that complaining about them is becoming a SL obsession. Relax, chill, enjoy the wonderful mirror on the real world that is SL. Nobody forces you to buy, sell or for that matter even exist in SL. It's not like buying RL food, petrol (gas) or a place to live. It's like deciding between a grande or a venti Starbucks (i.e. a luxury). Interestingly demand for luxuries tends to be quite inelastic (w.r.t. price) when RL economic times are good. Since that's the case at the moment, I would expect demand for land in SL to remain very high due to the growth in new users. In fact ceteris paribus, I'd peg a drop in demand to next RL recession (which is due about 2009 in the USA). Ok enough of my random musings. I very much enjoyed reading the opinions in this thread. Enjoy the ride, and happy new year.
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Darkness Anubis
Registered User
Join date: 14 Jun 2004
Posts: 1,628
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01-01-2007 09:01
A bit over 2 years ago land prices hit this level with the release of the first snow sims. 6 months later LL had released so much land you couldn't give your land away if you wanted to be rid of it. Land prices are cyclic. How far they will rise and how far fall is up for grabs but they will change. A far more disturbing trend I think is the degradation of the game experience both in performance and in service. Over the last 6 months or so I have seen many longstanding content creators pack up, tier down and leave. That trend is not showing any sign of stopping. I know of several that were waiting out the christmas rush for a little extra cash and will be calling it quits in January or February. We on Dragon Isle are watching the situation and quite honestly are considering that option ourselves (no decision made yet though). The whole situation is very sad, particularly to those of us who were here when SL was about creativity not money (for the most part).
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Usagi Musashi
UM ™®
Join date: 24 Oct 2004
Posts: 6,083
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01-01-2007 19:51
From: Finora Kuncoro Aside from your post not making much sense in general (perhaps the other 2330 posts were better  ), I'd disagree with your first statement. Can you sat TROLL!!!!! AND with a new account posting sme kids just love to cause problems................. 
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