Grumpity Linden talks Second Life to Le Journal du Net

Second Life banner piece for the October 25th issue of JDN

Cube Republic pointed me towards an article appearing in the French on-line newsletter, Le Journal du Net (JDN), a reference site for corporate executives produced by media group CCM Benchmark. The interview is also referenced on the Lab’s official In the Press page. Entitled Second Life’s annual GDP is $650 million, the article is the banner piece for the October 25th issue of JDN, the piece in places makes for interesting reading whilst also covering ground with which many SL users may already be familiar.

The piece starts with a discussion of the recent rise of “the metaverse” as a catch-all buzzword among tech companies from Epic Games to Facebook, and outlining the fact that much of what is now being hyped was similarly hyped 18-20 years ago, with Second Life one of few platforms that actually attempted to achieve it, and which should now, by rights, be regarded as a forerunner and living example of what “the metaverse” might be.

From here, she draws on a key differentiation between Second Life and the vision Zuckerberg’s company is offering – and the barriers they may well face.

I think they themselves realized that the reputation Facebook has forged over time can be a barrier. This lack of confidence in the company exists and there will have to be a number of levers of confidence to allow those who wish to explore these virtual worlds. But it is still too early to get a clear idea. At Second Life, we ensure the privacy of our residents. For example, some assume their homosexuality in Second Life, but we know that some may live in areas of the world where their sexual orientation could lead them to prison. We are therefore extremely vigilant on this issue of data security. With the immense wealth of data in the hands of the digital giants, it will be necessary to ensure the protection of the privacy of the users of these virtual worlds.

– Grumpity Linden (aka Anya Kanevsky, Linden Lab’s VP of Product), talking to French newsletter JDN

Later in the piece, she goes on to make a key point that has helped Second life achieve its longevity and which seems to be a point missed in many of the discussions / statements by other companies wishing to stake their claim to a vision of “the metaverse”:

Everything in [Second Life] was created by our residents and not by Linden Lab employees. We just play the role of facilitator. This represents our vision of the metaverse. I don’t see how creating different games that would be connected to each other could be akin to the metaverse. In my eyes, this is content created by companies for users. For the metaverse to exist, it must be created and managed by the people who live there.

– Grumpity Linden talking to French newsletter JDN

The more familiar waters sailed by the piece include things like the 200,000 monthly unique log-ins SL enjoys, the uptick in engagement seen during the core months of the Sars-CoV-2 pandemic (and that the Lab feel they are seeing many of those who turned to the platform to remain even as the freedom to get out and about in the physical world gets easier, even if at a reduced number of hours per session). It is in these discussions that the article’s headline – SL having a GDP of US $650 million – is references, and that in 2020, users collectively withdrew a total of US $73 million from the platform (potentially hinting at an overall rise in general revenue flowing into / through the Lab over 2019),

Whilst being cagey on the Lab’s overall financial footing, the point is made that it has been profitable for a long time. This sits alongside a comment on the way in which the lab has attempted to be responsive to changing economic needs by realigning where and how it generates its income from the platform. Tilia Pay is also touched upon, together with its importance to Second Life – if not its potential as a revenue generator for the Lab as a whole; an honest assessment is also given on Sansar and immersive VR – which also hints towards the Lab’s vision looking to a future that is broader than any reliance on VR headsets.

While a number of early adopters shared their enthusiasm with us, we also observed resistance from some users. Many were not thrilled with the idea of ​​carrying these VR headsets that are quite heavy and require enough space at home to be able to use them. If virtual reality allows for an immersive and incomparable experience, we observed that few of our residents were ready to wear these helmets for more than thirty minutes. So we plan to keep trying new things around virtual reality, but VR isn’t the only possible future for Second Life.

– Grumpity Linden talking to French newsletter JDN

In terms of this broader view of the future for SL in particular, Grumpity notes the need to provide access to it “on all platforms and on different devices,” even if the experience in accessing SL is not identical across all such platforms / devices.

The article itself is relatively short, but covers some good ground in a manner that will met the needs of JDN’s general readership. It provides a good “executive summary” approach, transmitting its core information without undue exposition. In closing the piece, the journalist, Adrien Tsagliotis, offers a quote from Grumpity that mirrors something I’ve long believed myself (and is actually evidence by the reality of SL’s user numbers), and which stands as something all those hyping “the metaverse” should perhaps keep in mind:

We have observed over the years that the population as a whole is not necessarily open to living this immersive experience in a virtual world. Once the hype around the metaverse is behind us, I think we’ll observe that not everyone is necessarily interested in experiencing virtual worlds.

– Grumpity Linden talking to French newsletter JDN

Opinion: LL, NFTs and a “WTH?” moment in Second Life

via Linden Lab

On Thursday, October 21st, Linden Lab took to their blog and to social media to announce the Zenescope x Second Life Sweepstake. Featuring some 40 NFTs – non-fungible tokens – the announcement met with a certain amount of “WTH?” reactions, my own among them.

The NFTs concerned are produced by Epik, and are focused on a series of digital images related characters from the Zenescope Entertainment’s “Grimm universe” (that is, characters somehow connected to stories associated with the Brothers Grimm).

Some may recall that Zenescope (and Epik) are in a partnership with Linden Linden that launched on August 4th with the opening of the “Zenescope Metaverse” in Second Life; a place promoted by LL as “bursting with magic and mystery” where people could “Experience storytelling and comic books in a whole new way”, a “huge” region “so highly detailed that it might just take several visits to see everything”, but which I found decidedly underwhelming.

The sweepstake is a continuance of that partnership, and marks a further extension of it that many SL users may not have been aware of, so I’ll just dip into here to offer a little more context.

As a part of this partnership, October saw Epik start to offer through their Epikprime marketplace, NFTs tied to nine individual Zenescope character images (apparently sponsored by LL) in various quantities. So, for example The Gretel and Belle images each have 1,000 NFTs (with each NFT having a minimum price of $27.00) while the Sky Mathers image only has 125 NFTs (with each NFT having a minimum price of $147.00.

For sweepstake prizes, I believe LL has taken 10 each of the NFTs bound to the Belle, Gretel and Cinderella images, and a further 10 from a “Halloween” image to be issued on October 25th.

What is an NFT?

VERY simply put for the purposes of this article: an NFT is a digital “certificate of authenticity” created using blockchain technology that represents an easily-reproduceable digital item (a piece of art or music, a game, a document or photograph, etc.), recording the provenance of that item – its origination (creator, date + time of creation, etc), and its subsequent chronology of ownership / custody location in the digital ether. 

It is the uniqueness of the data in the NFT that generates its value, not the item to which is bound, which can still be copied and shared just like any other file on the Internet.

One of the character image / NFTs purchase pages on the Epik Marketplace – Gretel is one of the characters for which NFTs are being offered as prizes in the sweepstake

When it was launched, the Second Life / Zenescope / Epik partnership was framed by LL as a part of a drive to expose SL to potential new audiences. But as noted, the “Zenescope Metaverse” revealed itself as a tepid environment, and even now, some 2.5 months later shows no sign of delivering on  hyperbole surrounding its launch, or present itself as a gateway into SL for Zenescope readers. Of course, that could change quickly – I’ve no idea what LL / Zenescope have planned; but right now it does feel like a hollow promise, and combining it with the sweepstake event leaves one feeling the whole LL / Zenescope / Epik partnership is decidedly lopsided and lacking in reciprocity¹.

Insofar as the sweepstake itself is concerned, another cause of a “WTH?!” reaction came when reading the rules for entry as published by the Lab. To whit:

[winners] may be required to execute and return an affidavit of eligibility, a liability release and, where lawful, a publicity release within seven (7) days of date of issuance

– from the Winners Notification section of the sweepstake rules

And:

Each winner, by acceptance of prize, except where legally prohibited, grants permission for Sponsor and its designees to use his/her name, address (city and state), photograph, voice and other likeness and prize information for advertising, trade and promotional purposes without further compensation, in all media (including digital media) now known or hereafter discovered, worldwide in perpetuity, without notice or review or approval.

– from the General Conditions section of the sweepstake rules

Obviously, given NFTs are intended to prove the provenance of a digital collectable, the recording of the owner’s identity in some form is to be expected. However, that the Lab – a company that has traditionally prided itself on respecting its users’ anonymity – should offer the suggestion that any personal information might be requested could be passed to whomever they designate (such as Zenescope and Epik) for purposes of their advertising and promotion, makes for uncomfortable reading².

For me the biggest “WTH?” reaction, however, came with the idea that Linden Lab – a company that oft wears its social conscience on its sleeve  – would opt to engage with a technology (blockchain) and format (NFTs) that has been repeatedly shown to be environmentally unsound.

The most common blockchain environment used to create and curate NFTs is Etherium. According to the Digiconomist website, a single Ethereum transaction, such as creating an NFT or selling it, a carbon footprint of about 33.4 kg of CO2 – the equivalent to 74,000 Visa card transactions or watching 5700 hours of You Tube videos, – and consumes enough electrical energy to power an average US household for a period of 6 days³. Others put the impact of individual NFT transactions even higher, indicating the “minting” of an NFT produces up to 83 Kg of CO2 and consumes up to142 KWh of electricity (enough to power the average US house for around 12 days), with an subsequent transactions generating an average of 48 Kg of CO2 each.

So, if I’m reading the Epik marketplace pages correctly, if all 5,125 “Zenescope x Second Life” NFTs currently being promoted. are all minted, they will generate a total carbon footprint of 171,175 kg (using the Digiconomist figures), with a further 33.4 Kg added with each sale or other transaction related to each of them. By comparison, were 5,125 print of the images to be made and individually shipped anywhere in the world, each would only generate (according to Quartz and others) a carbon footprint of just 2.3-2.6 Kg, it’s a far more ecologically responsible option.

True, printed copies removes the animated uniqueness of the actual images – but this could be compensated for by the prints being individually signed and numbered by the artist., something that would also help the prints maintain there resell value. And you’re thinking any such resale value would be less than that of any NFT equivalent, let’s just be honest: these particular NFTs really aren’t going to set the NFT collector market on fire and demand stellar prices.

But if LL feels it must jump on the NFT hype train, then I cannot help but agree with this tweet on the subject:

SecondLie may be a parody account with a slick hand for the snark – but it can also offer clear and honest commentary

Obviously, this is in many ways easier said than done, but there are potential opportunities to be had:

  • It would demonstrate LL’s engagement with and support of their own users and platform, removing the perception they are simply “shilling” (to use a term that has popped up in several places in reference to this sweepstake) for a third party.
  • Properly promoted and broadcast, the availability of NFTs produced through SL could speak to the world about relevance of the platform as a place of creative endeavour and expression, potentially encouraging other artists from all walks to come and give it a go.
  • It could be combined with other opportunities for outreach and promotion to more broadly demonstrate the “multi-role” nature of Second Life in addressing use-cases from all walks of life, and offer a place of relaxation, learning, fun, business, and so on at a time when others are still struggling to define what they mean by “metaverse”.

As it is, this “sweepstake” is generating a lot of “likes” and “loves” on social media – although it is hard to tell if this is the result of people actually reading the associated blog post / wanting to winner one of the prizes, or simply the result of instinctively clicking the “like” / “love” icon in response to a posting from an official SL social media account. Whether it results in the Lab seeing this particular offer a “success” and thus worth possibly repeating, or whether they’ll heed the largely negative comments that have similarly left on said social media posts and so think twice about any repeat, I’ve no idea. Purely from my own perspective, I’d rather they didn’t run with any repeat, and instead continue to devote their time and effort on those things that are actually going to raise broader awareness of SL’s continued presence, vitality and relevance – and which can encourage people to come and experience the platform for themselves.

  1. It was recently pointed out to me that Aura Linden recently opened a viewer repository focused on puppeteering, something which has lead to some wild speculation on my part. Might this be a means LL are looking to use within the Zenescope region to allow visitors to “Experience storytelling and comic books in a whole new way”, through the use of NPCs based on the characters being promoted via Epik? Given the state of the repository code, this does seems an awfully long guess (and so probably wrong).
  2. I have actually contacted LL on this and the idea of distributing personal information, but have yet to receive a reply.
  3. And if you think that is bad, Bitcoin is even worse: Digiconomist estimate a single transaction carries a carbon footprint equivalent to 1,880.406 Visa card transactions or watching 141,404 hours of You Tube videos, while consuming enough electrical energy to run an average US household for two months!

Linden Lab launches the Official Second Life Merchandise store

via Linden Lab / RedBubble

Some might say it’s a long time overdue, but on Friday, September 25th, Linden Lab announced the launch of the official Second Life Merchandise Store offering a range of physical world merchandise related to Second Life and Linden Lab.

The on-line store is hosted by RedBubble, and currently comprises a range of SL and Lab branded clothing items and accessories utilising both the “new” and “old” logos, with the promise that more items t come soon, including seasonal and limited time items.

The Second Life store on RedBubble

As with most virtual market stores, the RedBubble Second Life Merchandise Store feature a list of categories down the left side of the page (note: these are a part of the site design, and not all of them may apply specifically to Second Life / Linden Lab). The main part of the site is then devoted to displaying the displaying the essentials on available merchandise, with filter options, and the ability to use at the designs offered with applicable products, rather than the product itself. Obviously, clicking on an individual item will open a page devoted to it, where things like size, etc., can be selected.

A nice aspect of the site is that it appears to automatically recognise your country of origin and presents prices in your local currency. Payments can be made via Credit / Debit card or using PayPal, whilst shipping options are available for “regular” or “faster” delivery. Joining RedBubble allows for faster checkout: your own personal page, a complete order history and tracking option, and the ability to follow favourite merchants on the site (such as Second Life / Linden Lab) and receive notification of new items as they are added to the store.

RedBubble automatically recognises your country of origin (unless using something like a VPN, perhaps), immediately presenting the price of items in your local currency, as seen here, in my view of some of the SL merchandise

I’m not entirely sure why the site features a couple of skydivers snogging as its banner image – perhaps this will change according to some site criteria, but it did strike me as something not really immediately representative of either Second Life or Linden Lab – not that either is particularly easier to pigeon-hole in a single image for those unfamiliar with either.

That very minor niggle aside, the store would appear to be a good move – hopefully we’ll see merchandise such as mugs (Lab Gab mugs have oft been requested), coasters, key fobs and other handy items, as well and more clothing items appearing in due course. Actual Linden Bears would be fun as well, if perhaps harder to produce in  a cost-effective manner.

In the meantime,those interested / curious can hop over the the official store and have a mooch.

YavaScript Pods: situation resolved as Lab to work with Yavanna – UPDATED

Yavanna’s pod tours: agreement reached between Linden Lab and Yavanna that will see normal operations resume

Updated, August 25th: following Patch’s forum post, Yavanna issued a note card through the in-world Pod Riders group stating her pleasure with the outcome, and I’ve quoted it at the end of this piece. 

On Friday, August 21st, I reported on the news that for various reasons – including her on-going recovery from being stricken by COVID-19 -, Yavanna Llanfair, had decided to suspend the automated running of her Mainland YavaScript Pod tours (see: YavaScript Pod Tours Mainland operations suspended – UPDATED).

At the time, there was a certain amount of confusion over what may have happened with regards to an account suspension she had received in late July. As I noted in an update to that original report, this matter had particularly confused Patch Linden, who commented on a forum thread on the subject, promising to look into things.

Keeping his word, on Monday, August 24th, Patch provided a further update:

Howdy everyone!
I have returned with an update!  😁  We have just met with Yavanna and I am super excited to say that we will be working more closely together going forward on not only helping to support the pod tours system as it currently exists, but also expanding it in to other areas it does not reach today.   I’m sure that as expansions and other fun add-ons unfold, there will be more updates on those as they happen.  For the immediate future, the pod tour system should be retuning to normal functionality.
Thanks to all for the feedback!

– Patch Linden, August, 24th, 2020

By “returning to normal functionality”, Patch presumably means that the automated running of the pods across the Mainland will shortly resume.

In the meantime, speculation has already started on what the “expansions” to the system might be – including suggestions such as using the pods to make tours of Bellisseria and the SS Galaxy, which as I reported in January (see: SS Galaxy drops anchor at Bellisseria), is now moored off the west coast of that continent.

Obviously, time will tell where the expansions are concerned, but for now, Patch’s immediate news is being warmly received by the majority of Mainlanders concerned about the situation, and pod users.

Update – Yavanna’s Comments on the Outcome

Following the publication of this article, Yavanna issued a note card giving her very positive reaction to the understanding that has been reached between herself and the Linden, which reads in full:

Dear pod riders,
I am very pleased to report that I’ve just had an extremely constructive meeting with Patch Linden, Derrick Linden and Tommy Linden. Hopefully I won’t get suspended for a pod crash again! (It was clearly a mistake). I have therefore removed the server block on the pods.
It’s actually better than just that though. We were able to discuss possible future joint ventures, and how they could help me going forward. So I’m very happy about the outcome of all this.
I’m extremely grateful to you all for your support. It’s not been an easy time for me lately for reasons I’ve talked about before, but your good wishes have made me feel so much better.
I’m still going to be mostly keeping out of SL for the moment, but as the winter nights draw in and I feel better in myself I hope to be working on more pod projects.

 

A decade (+) of blogging: thoughts on Second Life

On the occasions of my 13th SL rezday, Erik Mondrian reminded me that 2019 marks my 10th year of blogging via WordPress (I’d used another platform for a couple of years prior to that). With his reminder, Erik presented me with a challenge:

A slightly belated Happy Rez Day, Inara! And, if I may, perhaps a challenge? Not that you’re short of things to write about, but if you have time: In the last 10 years, what do you feel has been one of the best changes/additions to SL? And what are your hopes for the next 5?

– Erik Mondrian, via Twitter

As I stated in my reply to that tweet, I’m note sure I could pin thoughts down to any one thing in terms of what has positively happened to Second Life; there are simply too many – and some tend to be interconnected in some ways. However, I’ve been cogitating Erik’s challenge, and here is (slightly later than planned) an abbreviated list of some of the things that I believe have either benefited SL or had a positive impact on it over the last decade or so, and which I’ve particularly appreciated during my time using the platform.

Communications with the Lab: the relationship between the Lab and SL users has tended to be a complex one. At the time I moved to blogging via WordPress, things were at a low ebb. There had been the Homestead region situation, together with the drive to make SL a more “business oriented” platform (vis: Mitch Kapor’s SL5B crossing the chasm address that appeared to suggest SL’s early adopters were interfering with trying to reach an early majority audience; suggestions that parts of the Mainland should be made “business only”; the (ill-fated) Second Life Enterprise (SLE) product development; lectures from form Lab employees on how users should dress their avatars “for business”, etc), all of which left a lot of SL users felling pretty disenfranchised.

However, starting with Rod Humble and particularly with Ebbe Altberg, the Lab has sought to strongly re-engage with its users and embrace them. Things haven’t always worked out in their entirety (communications did go a little backwards towards the end of Humble’s tenure); but there is no denying the improvements seen through activities such regular Town Hall / Lab Chat / Meet the Lindens events plus the likes of VWBPE addresses and Designing Worlds interviews, and the simple expedient of allowing LL staff to once again openly engage with users whilst using their “official” accounts.

Windlight: although it was originally introduced in 2007, Windlight had a profound effect on the appearance of Second Life that’s hard to overlook. Originally a third-party product Linden Lab acquired and which didn’t see all of its potential capabilities implemented (for whatever reason), the overall impact of Windlight shouldn’t be trivialised.  If you need an idea of how SL looked pre-Windlight  – with the exception of the old particle clouds – just disable the Basic Shaders in the viewer.

Open sourcing the viewer code: also introduced in 2007 and not without its share of hiccups / controversies (the Emerald viewer situation, for example), the open-source project has undoubtedly served SL well. It has allowed third-party viewers to thrive within a reasonable framework, and both exposing features hidden with the viewer’s debug settings and allowing developers to add their own options, allowing users a greater choice of client options. It has also provided the means for users to contribute potential improvements to the viewer back the the Lab, generating a a largely positive synergy between developers and the Lab.

Mesh model import: admittedly, the impact of mesh modelling in Second life cuts both ways: positive and negative. Leaving aside what might be regarded as its negative aspects, it has helped to improve SL’s look and feel, potentially made region design more accessible / attractive, and helped bring improvements to the avatar we might otherwise not have seen, or which may have not have been implemented until later in the platform’s life (e.g. Bento and Animesh).

Performance improvements: over the last decade, LL has worked extensively “under the hood” with Second Life to try to improve overall improvements, such as the long-term Project Shining. Running for some 2 years with the aim of improving object and avatar performance, it was followed by further projects and efforts to help improve performance in assorted areas. Some have had mixed initial impact, but all of which have, overall, helped to improve things for most users, even if only incrementally in some cases.

Materials, Bento and Animesh: all three have helped improve the look and feel of Second Life, making it more attractive to users old and new.

Looking to the next 5 years, there is much that might happen or which many would like to see happen – from technical aspects such as further improvements in simulator performance (e.g. script and physics performance, region crossing management), through to more esoteric aspects such as audience growth / user retention, fee balancing, etc. However, I’ll restrict my thoughts for the future to one topic: the transition to the cloud.

This work has already eaten into the Lab’s engineering and operating time over the two years, and will doubtless continue to be a significant focus for 2020. However, it is a leap into the unknown for Linden Lab and Second Life, both technically and in terms of operating outlay / revenue generation (e.g. capping the cost of having cloud servers running 24/7 in a manner that doesn’t require uncomfortable fee increases).

On the technical side, it’s more than likely that the focus on moving to the cloud has a higher priority that developing significant new features for SL – and perhaps even curtailed implementing updates that might be seen as having a limited lifespan, such as infrastructure changes that could be rendered obsolete following the cloud uplift, but which are nevertheless causing a lot of teeth grinding amongst users.

Even when the uplift itself is completed, it is likely that the transition will still require a significant among of settling-in and adjustments that will continue to occupy the operations and engineering teams. So there is a lot hinging on this move that will continue into the next couple of years, and that is important to the overall future of the platform.

Thoughts on Second Life fees, tier and revenue

via: thebluediamondgallery.com

Monday, December 2nd saw the introduction of the new Marketplace (MP) commission fee of 10%, as announced in the Lab’s November 21st blog post The Return of Last Names and Changes to Marketplace, Events & Premium.

The announcement of the fee change unsurprisingly caused some upset, with a couple of forum threads popping-up on the subject (see: MP fees raising to 10% per sale. Thoughts? and Second Life® is still a world of opportunities). Various points are raised in both threads, some fair, some perhaps not-so-fair. While I’m the first to note that I’m not in any way, shape or size a “merchant” or “commercial creator” in SL I thought I’d try to step back and try to take a broader look at fees and tier, etc., in general.

The first point to note is that in making the claim that the increase to the MP transaction fees still leaves them “significantly lower than most digital content commissions across the industry” while citing Apple and Google as examples, the Lab did so with a certain amount of spin.

The 30% charged by Apple, for example, incorporates payment clearing, fraud, indemnity, insurance, and dunning; local tax law enforcement & reporting; service provisioning and distribution, etc. Due to the nature of Second Life these fees are incurred separately to the MP – but they are still incurred by many merchants using the MP, and when taken into consideration, they amount to somewhat more than 10%, a point Cat Hunter makes in this comment.

Also in their blog post, the Lab note that that fee change is to help offset costs incurred at the Lab due to investing in new Marketplace features and improvements. This is fair enough; however, given that the first of these changes is apparently within weeks of being deployed (improved MP search filtering), it might have been an idea to perhaps to wait until these changes had been introduced  before announcing the fee increase – and then to champion them alongside the improvements that have been made over the last 12-18 months, such as the much-requested Store Manager capability and the notifications and redelivery capabilities and wishlists and favourites¹.

However, there is a more intrinsic reason for fee increases – be they with transaction fees or anything else (such as the recent increases in Premium subscriptions), and it is one the Lab perhaps doesn’t communicate clearly: and that’s trying to reduce virtual land tier.

While tier has contributed to the loss of regions in SL, including places such as Venexia (above) and its sister region, Goatswood, lowering it without increasing fees elsewhere would always hurt Linden Lab more than help users

This is something that users have (rightly or wrongly – there are actually arguments on both sides of the coin) been demanding for at least the last decade. And since the start 2018, Linden Lab’s CEO, Ebbe Altberg, has repeatedly stated the company would like to reduce land tier – but would only be able to do so if the resultant loss of revenue the company would suffer as a result could be compensated for through other means².

In fact, the Lab have taken steps to reduce tier: in 2016 there was the private region buy-down offer³ (the interim boost to LL’s revenue as a result of the fees payable likely long since having passed), and in July 2018 reduced private region tier from US $295 to US $249 for Full regions (that now stand at US $229), and Homesteads from US $125 to US $1094.

While it is hard to accurately quantify, given the various factors involved (e.g number of grandfathered, skill and educational regions, the more recent slight increases in region count, etc.), it is – with the help of Tyche Shepherd’s Grid Survey and the Internet Wayback machine – possible to reasonably (conservatively?) estimate the impact of the July 2018 tier reductions at around a LS $300,000 a month fall in the Lab’s land revenue. This may not sound a lot – but it is something LL would likely want to recoup – and it can only be done through increases in other fees, as Altberg noted in his comments on the matter.

This should not be taken to mean the transaction fee is wholly associated with compensating for the tier reduction, but it’s not unreasonable to assume it might nevertheless help, either now or in the future. More to the point, and regardless of where the revenue from the MP fee increase is used, it wouldn’t hurt for the Lab to remind people of the strategy to pivot revenue away from land tier and to other options when making similar fee adjustments elsewhere (or indeed, the introduction of new fees, even it they may also help offset the cost of implementing new options and capabilities).

There are two final points that come to mind when looking at the MP transaction fee change. The first is that of all the fee changes thus far introduced, it is the one that merchants can most directly compensate for, as some in the forum threads have noted. Merchants can raise their MP prices, for example, whilst keeping their in-world prices lower (which is allowed5); or those with in-world stores might focus more on sales through that channel, with associated group advertising.

The second point comes back to the timing of the announcement. It would seem that the increase has been made so that the Lab can benefit from the likely increase in MP sales during the run-up, and indeed over, the holiday season. There’s nothing wrong with this per se; but given the increase has likely been on the cards for a while, it would have perhaps have been preferable had LL given more of a lead time on its implementation so allow merchants more time to prepare for it, and so help them in compensating in what might come across as a reduction in their own ability to generate revenue through the same holiday period.

Related Links

  1. See:
  2. See (all with audio comments by Ebbe Altberg):
  3. Lab: get grandfathered tier in 6-month buy-down offer (April 2016).
  4. Linden Lab announces major SL private region pricing restructure (June 2018) and Looking at the new private region and L$ fees (July 2018).
  5. Web Team Springs some Deploys on you, April 2018.