Land costs in Second Life are one of the most controversial issues to discuss. While it is often claimed that “the tier is too damned high”, the Lab has always been somewhat hoist by its own petard in having virtual land fees as the mainstream of its income. As I explained at length in January 2013, this actually limits how much the Lab can actually do with regards tier without potentially hurting its ability to function.
However, one area that has always seemed unaccountably high is the one-time set-up fees charged for private regions. These have stood at US $1,000 for a standard full region and $375 for a standard Homestead region (both inclusive of the first month’s tier, and ex-VAT where applicable) for many years, which has always come across as an exorbitant amount to charge. There have been numerous calls over the years for these fee to be reduced; in my 2013 article linked to above, I went so far as to suggest a reduction in set-up fees coupled with a modest reduction in tier might be a way forward for the Lab.
The Lab, though, seemed steadfast in its approach. Tier would always be difficult to adjust, and they appeared reticent to play with the set-up fees. But on Tuesday, November 17th, that latter point changed.
As announced in a an official blog post, the Lab has confirmed that with immediate effect set-up fees across all private island products (Full, Homestead and OpenSpace, both developed and undeveloped), have been reduced by 40%. This means that the set-up fees for all classes of private island product are now (ex-VAT, where applicable):
- Full Private Island US $600
- Themed private island US $629
- Homestead region US $225
- Themed Homestead region $250
- OpenSpace region US $150
What’s more, anyone who has paid a region set-up fee in the past 14 days will receive the difference in fees back as a credit(in US Dollars to their account balance.
This is undoubtedly a step in the right direction – although how much of an impact on land usage it has will be interesting to monitor. In October 2011, the Lab abolished all set-up fees for a period of one month in a “land sale”, which saw 689 added to the grid, a net growth of some 508 regions for the month. Unfortunately, such was the situation then that, as the realities of tier kicked-in, the increase in regions was all but negated in a few months as the heavy decline in region numbers continued through 2012.
As it stands, it is fair to say the global economic situation has improved since 2012, and people have again found themselves with more in the way of disposable income in their pockets they can put towards tier. This has likely to have been a contributing (but not the only) factor in the slow-down in regions losses seen in 2013 / 2014. But will a cut in set-up fees be sufficient to fuel a further sustained slow-down in grid shrinkage which has accelerated slightly in 2015? That’s something only time will tell, although I’m admittedly sceptical.
Which is not to negate the move by the Lab in any way – rather the reverse, it is most welcome, if perhaps a little overdue.
Tier has been a significant contributor to the loss of regions in SL, including places such as Venexia (above) and its sister region, Goatswood. Whether the reduction in set-up fees will help slow this situation down is an open question.
Changes to Transferring Regions
Alongside the set-up fees reduction for private regions, the Lab has also announced changes to transferring regions with grandfathered pricing, with the blog post stating;
Previously, Private Islands with grandfathered pricing would lose that status and revert to the usual schedule of land maintenance fees when the regions were transferred to a new owner. Today, we are changing that policy to make it easier for these regions to remain on the grid if and when they are sold to new owners.
Effective immediately, both Grandfathered Full Private Island regions ($195/month) and Grandfathered Homestead Private Island regions ($95/month) may be transferred to new owners without losing the discounted pricing.
However, this news come with a caveat: the one-time transfer fees for grandfathered regions are increased, with grandfathered full regions costing US $600 to transfer and maintain the grandfathered tier, and homestead regions US $300 (both fees per region, and exclusive of VAT where applicable),