A recession in Second Life?

Can we be heading into a recession in Second Life? Seems to me the indicators all show towards some tough times coming up.  My reasons for this suggestion would be:

1. Large unique product designers complain of a massive slowdown in sales,

2. land parcel sales are stale stale stale,

3. and the general resident’s outlook is pessimistic to say the least.

In RL we are already amidst a massive slowdown regardless the views from some circles that things are ‘looking up’ – I tend to ignore those comments since they almost always come from either a salesperson trying to protect their fading markets, or a 7 figure salary earner who has no idea what it is to not have money in the bank these days.

In SL we have similar problems and they are worsened by some stupid decisions by Linden Labs.  The three most glaring are:

1. The huge drop in island pricing (wont even go into that in detail!),

2. The introduction of too many new mainland parcels dumped onto SL’s land store,

3. and the resistance to take strong action against residents who rip off other designers products and resell them for their own gain.

Before I chat about land, as an open source supporter, I tend to talk about releasing things into the wild when done, but I have to say I have turned a bit on my views on IPR whilst living in SL.  The main reason for this is the blatant abuse of such an approach by some residents who will do anything for Lindens, leaving designers of unique products in the lurch by ripping off their hard work (illegal in terms of the SL ToS) and then selling these on to unsuspecting residents.  The whole point of the ToS clauses covering copyright and IP is to ensure this cannot happen, but time and again I read about designers or hear from designers how they have again been failed by Linden Labs when they report a blatant abuse and do not receive a response.  This MUST stop as it is killing off the creative spirit within SL fast and leaving people disillusioned about the whole concept of creative license protection.

Now land, wow, what a statement the other day from Linden Labs. The old saying of Second Life being for the residents by the residents really got an old kick to the head by the statement that Linden Labs like to control the land pricing to ensure it remains reasonable, and have in fact got themselves a nice tool to show the average pricing per sq meter on a daily basis.  Though this seems quite acceptable to the general residents out there, lets look at this closely.  What this means is that once the pricing rises above L$6 per sq meter on average for too long, the Lindens close in and dump land en masse on the Land Store to help that price drop through the floor limit of L$6 per sq meter again.  However this action does not do that at all, it in fact does the opposite as land pricing on the mainland during auctions go completely kookoo!  And Land barons almost always close in with land bots and seize any parcel available for close to that price per sq meter, to resell again at a much higher price.  The Lindens are happy in both cases, they get a good return on the auction, and they think that the initial low price sale (if any) was a good deal to a resident.  I say all that did is enable those with money to spend on the more desirable parcels on auction and land barons through a land bot got the good deal in-world, whilst the general resident got nothing!

The worse contributor to the land price fall is almost exclusively the massive drop in island pricing, firstly hitting the private owners core (not the Lindens as they only do Mainland) with a loss of 40% in land value overnight, and the availability of Open Space or Void regions to residents to own.  This unbelievably short sighted drop in land value is the largest contributor along with stolen product designs, and these two factors will see the recession bite hard into the Second Life economy in my opinion.

As far as island ownership goes, having bought all my islands other than two Open Space or void regions at the old US$1675 per region price, I can tell you its hard work remaining positive. It seems that at Linden Labs they have forgotten just how hard a private island owner must work to draw residents away from the HUGE mainland where 95% of residents land after orientation as newbies, and then to keep them coming back to your island when you do succeed at the first.  Sq meter pricing does NOT act as a good measure for this at all and I would recommend someone at Linden Labs start to ‘own’ their own private island with the same rights and facilities as the average island owner has, to experience just how frustrating it is to survive.  Drop into this equation the fact that multi billion $ corporations can now buy land anywhere at the same rate as the average salaried individual who does so out of his or her own pocket, and the entire thing turns on its head!  What makes this even worse is the perceived actions on the part of Linden Labs to favour such corporate purchases with great fanfare, that in turn drives curious residents to these new regions without the corporate having spent much on marketing or effort.  This is all part and parcel of private island ownership these days, and hard enough to handle without the drop of 40% to your land value overnight!

My recommendations: Land – Hold onto your land if you can afford it, or sell it and rent if you cannot.  If you design, try some new ideas like forcing (nicely – call it customer support) people into a group prior to the actual sale, or if that’s too impractical, ensure you keep all the records as an audit trail so that abuse reporting can be driven intelligently by you if you find someone ripped off your designs, and report report report.  Maybe we can whittle down the wall of ignorance at LL by complaining complaining complaining in volumes they have not yet heard.

Personally I have thought many times over to simply leave this all and visit SL in the future only as a resident without land, or any in-world ambition other than having sex of course, since this still seems the most popular activity in world these days 😦 (how creative is that, and I’m being sarcastic here for anyone missing the point). I say this as I just do not believe for a moment that anyone at Linden Labs has a concern about helping those who have put their own monies into SL and worked hard to be where they are individually (not corporate or charity) and this greatly increases my anxiousness about life for me in SL.

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2 Responses

  1. Note that Linden Lab’s marketing strategy was well-coordinated: at the same time they made a galore of mainland parcels available, to the point of disgusting those sim owners trying to rent or sell, they dropped the price of a private island, to discourage island owners from selling (as they now would sell their possession at a loss).

    I don’t appreciate a bit being perceived as a “captive,” taken-for-granted customer. Especially at a time when other, very interesting virtual worlds are about to blossom.

    Signed: A sim owner about to sell his sim anyway

  2. Christophe, I agree. Its damning to the entire island owners group who do not have RL corporate or charity funds behind them. Our sims in the Bishara Resort estate are also not for profit as such, as we made them for the community to enjoy. I was initially inspired by the stunning work done on the Svarga region.
    Sadly I think the days of doing Svarga type work in Second Life is over, as the Lindens now wish to cater to corporates almost exclusively and they price and structure everything accordingly, in my opinion anyway. Now I am forced to fill the sims with some vendors and sell off some parcels cheaply just to accommodate the shortsighted changes from LL.

    Are our efforts noted? Not in your life. Now if I was IBM or Google or eBay or a charitable organization or a tourist authority like the very recent Costa Rica SL project (already in SL’s hot spot blog HA!), we would have been splashed across the SL pages by LL in a flash, shouted to the world that this ‘company’ or ‘organization’ is now found in SL, and here is the exact SLURL too! That entire exercise brings floods of residents to the project regardless its quality or true contribution to SL, as it is the very nature of people to follow LL’s lead when they recommend new places. And this happens every single time an outside organization links to SL in some way or another regardless the shortness of their time in-world.

    Bishara barely makes it into any search through the secondlife.com website, and none of our island names show up, even though most of them have been around for months now. Though we do come up somewhere in the SL search itself, using the in-world search has equally become a science of SEO or bust, and since we are artists not coders, and we do not have the funds to pay someone to do the optimization for us we even loose out there too.

    So like you my personal considerations of spend in-world is fast changing, and it is currently ONLY the surfing community that keeps me in Second Life, a community largely ignored by Linden Labs any way, despite being one of the most amazing, non-sex focused communities in their world whose assistance to new players are seldom equaled by other communities. Sad that we should see this change at Linden Labs from what the old timers used to say were a bunch of well meaninghippie type programmers who would help you anyway they could to get something off the ground.

    What really angers me is if you are based in the US and or you are a resident pre 2007 it seems one call to LL still gets you the discounts on sim tiers every time you complain. ATown Fall almost always has this experience, and has told me time and again, when he complains about the unbelievably bad performance these days he gets a discount on his sim tiers. I try the same and my tickets are not responded to in weeks or even months, and discounts?
    HA, never in your life! LL bills me every month regardless their performance.

    So, sadly, I agree with your view here, Christophe, though I feel obliged to continue to support the surfing community even though I have no income in RL these days to honestly afford that, but I do so in the hope that LL may come to its senses soon and possibly aid individual non-corporate non-charity funded sim owners who are not just in it for a quick buck, but who are really working at creating long term contributions to Second Life.

    I have one exception to the entire complaint against the Lindens here, and that is Torley, only because this is a Linden that still reminds me of what the old timers used to say all the Lindens were about, being there for the resident, giving away free content and free tutorials, and so on and so on, and yes, even visiting residents blogs or web sites to leave a comment or two. I really wish the others would take his lead here and simply refocus from the corporate attitude so many seem now to have developed to one of co-existing with normal residents, people like you and me who put our hard earned capital into SL without the possibility of writing it off to tax like all the corporates would do regardless the success of their projects in-world, or using other people’s donations like charities do to build a presence to ‘focus’ more people on their specific causes. Just for once it would be nice to have someone stand up for the small guy, in RL or SL, just once. If I sound bitter, it’s simply because I am, no excuses!

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