Second Life economy posts solid growth in Q4

Meta has updated and posted our Economic Metrics through the end of 2007, available in ExcelOpenDocument, and Google Doc formats.  The links on the Economy page are now updated appropriately as well.

 

Economic Growth.  Many of our economic metrics showed much slower growth from Q2 to Q3 as can be seen in the charts below.  We believe the slower growth was primarily due to the impact of stricter security on credit card processing, shutting down gambling in July and beginning to charge VAT September.  With those things behind us in the fourth quarter, the Second Life economy demonstrated its resiliency.  The LindeX – the purest measure of economic activity in Second Life – grew 13.2% to nearly $7.6 million USD for December and $22 million USD for the full quarter.  

lindexgrowth.png 

Concurrency.  Peak concurrent users, shown in the red line on the chart below, grew 12.5% in the fourth quarter to more then 58,000 – up more than 210% for the full year.  We’ve seen a growth in concurrency almost every week since the beginning of September.  Growth continued last weekend when concurrency grew another 5.3% to 61,500. 

userhours.png

User hours.  In December, approximately 893,000 residents logged more than 25.6 million user hours (shown in pink in the chart above) or more than 30 hours a month per user.  Of that just 519,000 Active residents, spent 25.5 million hours – averaging more than 49 hours per month.   (“Active” is defined as users who spent over an hour inworld during the month.)  

Combining a few of these metrics, indicates that residents spent more than $0.30 USD on the LindeX per hour used.  Most of this economic activity went to the more than 50,000 residents generating what we call “positive monthly Linden dollar flow” from their activities in Second Life.  We believe that many of these 50,000 users are creating the diverse creations and experiences that make Second Life such an interesting place to explore.  This is the powerful engine fueling the steady long term growth of Second Life.  The growth in Q4 combined with continued growth in January demonstrates that the Second Life growth engine is alive and well.

Transparency.  I really enjoy the fact that we are such a transparent company.   Throughout the good times and difficult times in 2007, we posted our numbers in a consistent fashion.  Even with all the data we publish, its funny sometimes to see how people get it wrong.  I wish other companies believed in transparency the way we do.  I’d love to see our registrations, active users, user hours, economic activity and anything else comparable on lots of virtual world and MMORPGs.  I’m sure some of the data is out there – and I’d love to see what you can find.   Please post links to others data in the comments or send them directly to me (Zee Linden) inworld.

We will be discussing these and the newly updated Service Quality Metrics at Meta’s office hours in Beaumont on this Friday morning, January 18th at 10 AM PST.

This entry was posted in Economy. Bookmark the permalink.

108 Responses to Second Life economy posts solid growth in Q4

  1. Cheese Cake says:

    So, charts. Awesome.

  2. Vx Shaw says:

    Can you imagine what the economic growth could be if LL could fix some of the long time nagging problems such as teleports, sim border crossings, and inventory losses?

    Gee, I’ve only noticed it for the past 2+ years…

  3. AnnMarie Otoole says:

    [quote]We believe that many of these 50,000 users are creating the diverse creations and experiences that make Second Life such an interesting place to explore. This is the powerful engine fueling the steady long term growth of Second Life.[/quote]

    I was just discussing that today on a couple of occasions. We need to mature beyond retail, dance halls and sex to provide grass roots entertainment to enter a more diverse and mature second life.

    The next generation of creativity will feed the survivors of the overcrowded retail malls and the ones that make products rather than lease space will be the foundations.

    I’ve proved you can charge admission for an entertainment venue. I offer a money back guarantee to visitors if they finish my exploration labyrinth and don’t agree it was worth at least twice the L$50 admission. About 400 customers so far and not a single refund.

    Themes like this will eventually be the backbone that supports the population after they drop dead from shopping, dancing and XXXing.

  4. RC Paderborn says:

    Glad to see that this aspect of the economy is improving! When looking for reasons for the slowdown in Q3, don’t forget that LL flooded SL with new land causing a massive depression in land prices in June and July as well.

    I fully expect to see another increase in LindeX for January of 2008 due to the honest bankers liquidating their RL investments and buying Lindens with them so they can give refund their ex-SL customers. For instance, JT Financial has $200,000 USD in RL investments to liquidate and return. That’s a nice one-time boost to the LindeX.

  5. janeforyou Barbara says:

    I never worried for the SL economy–LL knows wery well how to get in there cash 🙂 Besides there are many clever brains in SL that knows how to run there business wery well..a cold brain..a warm heart a good consept and think loooong terms, and you do ok.

  6. Desmond Shang says:

    Clear, transparent and wonderful, Zee.

    I share a lot of your enthusiasm, and I’ve seen a number of things ‘done right’ lately – pricing stabilised (thank you!), the basic experience improved, and smart policies with regard to gambling and “inworld banking” (heh).

    To me, steady means reliable. I’m more confident we’ll see the 100 millionth real signup now more than ever; the recovery from the ‘hype’ days was a soft landing indeed. Better that the economy eases up smoothly, rather than scream upward only to crash later.

    Desmond Shang

    Independent State of Caledon

  7. Ann Otoole says:

    i have noticed an increase in *real* newcomers lately. i’m hoping the use of zombies will decrease as people that resort to fraud to raise relevancy are shunned by the community at large. naturally this process could be greatly expedited if LL filtered out non interacting avatar accounts from traffic metrics. but a fix one way or the other is welcome.

    more programs to illuminate new talent, more programs to illuminate educational efforts, more brilliant use of the platform for interactive entertainment, more of what makes sl great is called for. and within this is the opportunity for philanthropists to draw more support to the cause for a platform serving the common good of the planet. the more good in sl the sooner the negative aspects (fraud, deception, theft, etc.) will be pushed to the side to wither out and leave for pastures of people that are not intelligent enough to protect themselves.

    btw that first graph isn’t all that great. it shows log growth followed by a plateau (caused by the disruptions induced by necessary policy changes) followed by a small yet steady trend in a positive direction. the slow drip fills the bucket. look for ways to enhance steady solid growth and forget about log growth rates. 3 years of steady growth are far more valuable than spurts of growth followed by disruptions in the economy.

  8. csven says:

    “I’d love to see our registrations, active users, user hours, economic activity and anything else comparable on lots of virtual world and MMORPGs.”

    But then the Shirky’s of the world couldn’t provide the kind of skewed outsider commentary that we all know and love.

  9. Claudine Chantilly says:

    The second graph appears to show negative ‘peak concurrency’ prior to aug/sep 2006. Please explain how this is possible.

  10. Lao-Tzu says:

    @ 2 : I agree. SIM border crossings (sinking in the ground and or uncontrollably flying/walking forward a great distance then rubber banding back) is a MAJOR flaw of the SL experience.

    Newbies: At the top of your screen, click VIEW then select VIEW PROPERTY LINES. You now will be able to see the RED lines that mark the borders of each region (sim). When walking or flying you can now know when to expect this archaic effect caused by the lag created when your avatar switches from one server to another.

  11. Digital Digital says:

    Wow, all I can say is OMG how second life has grown, I know SL has problems and all but OMG this is freakin amazing!!! I can’t wait to see what everything is like next year, you have to remember even though sl has problems , they do a real good job of fixing things :))
    Thank you linden lab keep up the wonderful work, I enjoy being a resident and look forward to continue my support :))

  12. Indeed Ann Otoole indeed. As i develope new games & gadgets i notice a substancial difference between the nautilus & corsica continent. Script performance on nautilus is about max 40.000 and on corsica 99.000, thus resulting in a far more userfriendly use of any scripted object. Makes me wonder, corsica was created right after nautilus, why that huge difference? The technical mess sl is and the longterm bugs that keep on coming back is what keep sl’s growth.
    SL makes even the trains i run fly around like they where rockets.
    Sl is sutch a mess technically that i am surpriced that people keep coming back and spend money. Its indeed time to take sl to a next level if it wants to continue existing.

  13. To see a sims performance press ctrl+shift+1 to toggle true that feature. Script performance or ips its called in that viewer. I even noticed that rezzing about 50 or 60 sculpted prims in a sim makes it lagging HUGE. I wonder why they even released that when its making sl an even more technical mess and lagging a sim that huge. Try it out, rezz some 100 sculpted prims in a sim and see what FPS does in that performance viewer, the lagging is regionwide so its in the sim server not the UI.

  14. I read that Linden sold 10% ownership.
    And they said it was valued at over US$500 million.
    You do the math!

  15. John Source says:

    The red line doesnt seem so logical to me . For the last 10 months there has been (hardly) no growth. It’s been stable and that’s not good for a game like this

  16. Blinders Off says:

    Such statistical charts have been presented before. Those charts were blown out of the water when someone decided to trace past demographics to population. Interesting what happens when one includes ratio of residence in those figures. It made the stats flip upside down. In short: yeah, the raw figures had increased by some 15% for the period, but population had boomed some 45%. Ratio per user had actually decreased tremendously. And those figures were for legit users, not for alts.

    So charts such as above, which provide only raw figures, are good for PR propaganda, not much more.

    You want to see the real facts, show the population growth over the same period and then provide the RATIO stats, not raw data. Anyone can post raw data. It takes some skill to properly analyze that data and see whether the growth is healthy or detrimental.

  17. U M says:

    I love these google stats Top 100 Countries by Active User Counts etc………sorry but if you believe these number then you been in VR worlds way too long. shakeshead does LL thinks we are this simple minded to believe these numbers????????????

  18. Sean Heying says:

    Wow the Lindex per capita has dropped through the floor through 2007 when Robin started her churchification of our world in order to standardize our imagination.

    All of 2007 has a Lindex of around 7,000,000 but the number of users has grown from 2,000,000 to 11,000,000. This means the lindex per capita has dropped from $3.50 to $0.67 give or take.

    I think this very real drop shows both that campers are sucking the life out of SL and that LL needs to take a hands off approach to governance. Fire Robin and stop her insidious imposition of her churches morals on the vast majority of users.

  19. Selkit Diller says:

    An in depth examination of the data shows with a little cross-referencing, that bot use has simply exploded at this point, and that the policy changes have simply shifted the market balance, rather than bolstering it. Legitimate users have done their usual with the Lindex, but as Sean Heying points out, the per-capita figures reflect a very large number of apparent bots and/or dummy alts for various purposes (traffic farming and camping, chiefly).

    I predict that this will continue to be a trend until traffic is made irrelevant, at which point we will probably see more truthful concurrency numbers and possibly greater grid stability. We can hope, anyways. Don’t ban the bots, make them irrelevant. Remove the archaic and over-gamed traffic statistic. Find a more realistic solution to a problem which is heavily abused by the unscrupulous, and please find an alternative to the politically motivated, ineffective Aristotle.

    Aristotle proved totally ineffective, given that a self-admitted seventeen year old, banned from my sim, age verified himself to get back onto the adult grid. Need I say more? The system is a failure, as is traffic as an incentive measure. Either remove traffic, or bring back mandatory paid accounts.

  20. Milo Bellow says:

    1. Only Non Thinkers Will Take Promotional Demographics At Face Value

    2. Patronising Arrogance Is Never Well Recieved

    3. Meh

  21. Tijn Erde says:

    Love how the Lindex Volume graph has a red arrow which completely ignores the fact that it seems to have stagnated since Q1/Q2 2008.

    I also find it funny how you praise the 50,000 “positive flow” people, whilst on the other hand doing nothing to protect their intellectual property.

    Anyway, as usual with statistics, and as showvn by commenters before me, don’t trust conclusions drawn from statistics at face value.

  22. Blinders Off says:

    @18: While I applaud your seeing through the hype and pointing out that the stats are slanted, I don’t agree with your attacks against Robin or statements about “churchification” of SL.

    What you are promoting is an SL without rules, where everyone is allowed to do whatever they flat well please… everyone his own boss and his own God. That is “churchification” if I’ve ever seen it… it just puts the law in each person’s hands instead of the company who runs the show.

    Now I will admit that LL seems amazingly inept at managing their business… to the point that I question whether it will still be around a year from now. However, total anarchy and chaos never result in a solid society and like it or not, that’s what SL is… a society.

    Gambling, pedophelia, and other things are illegal in many areas RL. People can lose REAL fortunes on SL just as they can in RL. All the whining in the world isn’t going to change that fact. People think just because SL is a virtual world, that RL rules don’t apply. Hogwash. Every society, from the family unit on up, requires some kind of rules to function properly. If anything, SL would probably benefit from INCREASED morality rules, not lessened. I know a lot of folks will disagree, but just look at the main continent. What a garbage dump!

    If LL believes something may be illegal and that they could wind up in hot water by allowing it on their system, if they even think it might be a possibility, they have every right to regulate their board as they see fit. It has nothing to do with morals (obviously… SL is about as immoral as a VR world can get). It’s just plain business. They want to stay as far away from IRS and FBI hassles as they possibly can.

    Just my 2 cents worth. I know a lot of folks may disagree, but in my experience, when people are allowed to do whatever they want, mob mentality and criminal activity takes over.

  23. la le lu says:

    what i can see is that growth simply stagnate. this is not good. people tend to loose interest in a) join second life and b) be in world.

    LL, do something. open the lab, change the policies, be more liberal, listen to what users say. LL, be more active with user feedback, answer questions, take users serious, use jira.

    for instance, you had a blog post “Calling all builders, businesspeople and budding fashionistas….educators, entertainers, and more…” and what did you do with this blog entry?? YOU CLOSED THE COMMENTS ON THIS THREAD. thats what i call counterproductivity.

  24. Blinders Off says:

    One more thought atm, if I may. I am rather surprised that LL would boast a quarter gain of 7.2m L$ to 7.6m L$ as “solid growth”. During that same period, peak user hours DROPPED. That’s “solid growth”?

    OK, I’ve run this into the ground enough. Maybe LL is whallopped by the exit of Cory, maybe they needed a morale boost so are patting themselves on the backs. Understandable really. But may I make a suggestion?

    Get in a top-notch programmer who can get your databases to work, improve logins and teleporting, more easily facilitate sim crossing (really, even if the system pauses 15 seconds on a sim crossing while it transfers data… that’s preferrable to a crash). Get Group Chat to work, get Group Notices to work, fix linking and other building problems, lower sim prices to a reasonable amount instead of gouging your customers… then I’LL pat you on the back. 😀

    Seriously. I’ve always given LL a kudos when it deserves it. Not much been deserving lately. So maybe a little more elbow grease and common sense, a little less of these useless charts above, and LL will have a reason for a pat on the back. 😉

  25. Klaatu Congrejo says:

    The red arrow on the Lindex graph seems to show a healthy growth over the past year. A closer look shows that the arrow is from Aug.2006 to Dec.2007 (a 16-month period).
    But if you imagine the arrow on the graph covering the period Dec.2006 to Dec.2007, the growth is not really that healthy!
    This would seem to further verify Sean Heying’s calculations and add weight to the arguments put forward by both Sean and Selkit Diller.
    Like Selkit, I also recently banned someone from my sim for harrassing my visitors, only to find him/her there the next day under another name and bragging that he’d opened another account using his dad’s credit card. I wonder how many others like this, and how many alts, are bloating the figures?
    Why doesn’t LL admit it? The age-veri system is full of holes and those Lindens trying to push it through need to take a reality check.

  26. nimrod Yaffle says:

    I suppose you include the hours that bots are logged in.

  27. transparency, yeah sure. You might release these statistics, but Linden Lab transparent? HELL NO!

    Just see how Gambling Ban, VAT and Banking Policy were introduced, far from transparent, and very dictator like. Overnight changing the rules of the game, and best of all: No communication before the policies at all, conduction of fraudulent business(regarding VAT without chance to accept or not the price increase, and missing receipts) and no clear extent of policing, without giving any knowledge of the extent.

    Linden Lab needs to learn to communicate, that’s the requirement to be a transparent company. We see mainly only 1-way communication, no upfront warnings or opening discussions or seeing what actually would be good for the community.

    Yes, Linden Lab is a company, and motivated by bottomline, but there is a better way to enhance the bottomline …. and that is, communication, proper communication, honesty and True transparency.

    Gambling Ban: No one was warned upfront, overnight putting a lot of SL businesses bankrupt. Decision based on being a CA business, and RL laws.

    VAT: Best of this was that it was mailed during the night for europeans! No upfront warning or notice, just an price increase effective immediately (which is illegal btw).

    Banking Policy: Unfortunately, you just punished all the honest inworld banks, crooks had already ran with money. Best of all, it seems one person was given upfront warning, LukeConnell Vandeverre, and well, who doesn’t really have totally clean reputation, infact, many people thinks he is a crook. Whether he is a crook, or not, i don’t know, but i know his reputation. This was introduced slightly better, giving 2 weeks time to comply, unfortunately however, 2 weeks is not enough for acquiring any kind of RL regulation really, even LLC’s registration from start to finish (there’s more than the initial registration) can take easily more than 2 weeks. And still no clear extent of the policy! It seems it’s actually a complete interest ban, and so far, even RL contract personal loans has been told to be banned if delivery vehicle is L$.

    That’s not true transparency!

    I appreciate releasing the figures, but tbh, they don’t matter at all nearly as much as those policies. The figures are interesting, but ultimately, does not affect daily business that much, they give some insight, nothing more.

    We would highly appreciate better communication, even if it would be 1-way, about the really important stuff. Figures aren’t really important.

    Did you guys even consult inworld business owners of the effects to their businesses your policies make? I’ve heard of no such actions at all.

    Please, become truly transparent, if you appreciate your business at all and want it to continue and achieve your goals, that’s the way to go really.

    And i do understand that hard decisions has to be made now and then, that’s why consulting the business owners is even more critical.

  28. Hello Zee and the rest of the Linden management.

    At first congratulations to you all in your persistance in telling people that want to turn a “blind eye” onto the SL economy, that all is fine.

    In addition, I found it very concerning that Meta discontinued the “unique user” data with the sentence that the algorythm wouldn’t be right. It was right all the time, until October 07. In my observation a vital milestone of the health of the SL economy has been taken out.

    The total growth over the time of Mid 2006 to the end of 2007 looks impressive and is, in its own, but a health of economy is not a total number, it is the growth in the between. and if you take this into consideration, tears roll down your eyes. The growth over the Q4 of 2007 is only marginal.

    The economy heavily based on exchange of “virtual” land has completely broken down and no action taken by Linden Labs has turned this effect. Any afford in returning to a nearly growth has failed as the decision made by Linden Labd in Q3 and Q4 (gambling ban, E.U. V.A.T.’ing) had a devostating effect on a very single tracked economy. land prices have declined by 100’s of %.

    The explosive influx of alternative avatars has been a mistake in it’s own as it shows a wrong growth. Only a unique user data, and even more the premium account data shows a real growth. Having only left premium account data (the evangelists of SL), the growth is minimal and indicates that only very very limited amount of people see Second Life as worthy to invest money into.

    The Lindex (better holding hostage of CreditCard money) is marginal declining or stable over Q4, as no newcomers entering this economy, people are not able to sale up and exchange ownership, what is a super vital key factor in a land market economy. I believe that through the decline of land byuing newbies and though this effect not giving the possibility for land owners to sale up and take out the money of the Lindex is the only explanation that the Lindex is where it is. If landowners had the chance to sale up and take out the money, Lindex would be back to a stage od Q1 2006.

    Linden Lab, please wake up and smell the coffee, the big times of tapping yourselfs onto your shoulders are over, sit down with economists and try to rescue an economy that is lingering in a treat of resession.

    Good Morning

    Marc Montague

  29. Alanna DuPont says:

    I am surprised…really. I have one bussiness since one year ago and last 6 months had been really bad and some one catastrophic. I can think that is only me…but all bussiness people that I talk say me same. No gambling, crash with land sells, every SL corner with full permiss, bots,… I just hope that fantastic results of economy will be real to everyone that pays a lot of money to can keep land (+VAT of course in my case). But thx Linden Labs for this information, we really love SL and all options in this new world. Please send more information like this :).

  30. Pingback: Australians in Second Life Update - down again : The Metaverse Journal - Australia’s Virtual World News Service

  31. Gully Miles says:

    Zee, your transparency is commendable.

    Is it possible that your definition of “active residents” could be shared more widely within the company? I’m not sure that everyone there is familiar with the distinction between people who actually use SL, and people who came here once, either for minutes or months, and haven’t logged in for ages.

    I’m thinking, for example, of Philip’s January 9th blog post in which he refers to the residents as “the first hundreds and now millions of people who had the courage and passion to bring the virtual world to life by creating it and then believing that is was real”. I guess 519,000 doesn’t sound as impressive as “millions”, but it would surely look more consistent if everyone in the company was using the same figures and definitions.

    I notice he also refers to Starax Statosky in his post — “I’d love to see Starax’s version of an Emmy” — presumably not realising that Starax left Second Life 17 months ago, and that there were many rumours at the time that it was SL’s problems and instabilities that led to him selling up, closing his account and leaving.

  32. Gully Miles says:

    Oops, my bad — it seems that Starax recently decided to come back under a different name, presumably after spending a year getting whatever had irked him out of his system… Memo to self: must google better before posting.

  33. I can see through this transparent prospectus that you’re doing very well. Yeah!! I’m elated for you and your success (aside from all the negative comments you’ve received thus far).Hey, the ignorant should be aware that Beta versions and in an expansive metaverse such as this, there are to be bugs. That’s a fact of life. Your (LL) engineers are doing a wonderful job keeping things up and running. Your support desk is tops: Professional & knowledgeable. It they don’t know the answer, they know what to do to best help you. Your Knowledge Base is overflowing with helpful data. One just can’t get lost in SL unless they really, really try. All in all, SL is a success. To the dissatisfied: Get over it. Now, to the Linden’s I care so much about: when/how do you propose the subject matter (speaking strictly for my many close friends)?

  34. Pingback: Finger Food (24) « 88 Days

  35. Carlos says:

    Nearly 406 million people speak Spanish in the world and the Hispanic community in Second Life is great.

    Because we already offer a translation of the web in this language, perhaps we admire so much better economic data.?

  36. Villanova says:

    If I am not wrong, I see that SL has reached a plateau in 2007 – where is the solid growth?

    Additionally, the user core is half a million (less then a tenth of the nominal population), 10% of which are making Linden money.

    I think all people screaming about bad policies and decisions last years were not wrong.

  37. John Horner says:

    Perhaps there is something here I am missing……..

    From a TA (chartist) viewpoint the LindeX volume is flat over the last year, it appears to be running into a resistance level at around $7 B

    Ditto User Hours. In fact if I take the moving avage on that graph as an indicator of longer term growth there has been once recent Black Cross (actual stats under the longer term MA)

    Lots of SL technology is above my own personal pay grade but charts I understand only too well…….

    Any other TA folks here? Views welcomed

  38. U M says:

    Sorry 33 i am lost in translation here. Are you saying things are all well on sl these days? Frankly they are not Growth is slow and paying accounts are dropping off. Anyone that can read those charters can tell you they are not real. They can`t be, mind you tho this isa vr world right? Hence VR number is key here.

  39. Yokohama Imako says:

    Terms of Service

    1.6 All aspects of the Service are subject to change or elimination at Linden Lab’s sole discretion.

    “Complaints regarding Linden Lab has the right at any time for any reason or no reason to change and/or eliminate any aspect(s) of the Service as it sees fit in its sole discretion.”

    People complaining about change without notice (aside from a Blog entry) should have read the “TOS” prior to joining SL or complaining which only shows your ignorance. Very rare occurrences, such as immediate changes in policy, don’t “just happen for the heck of it”. There is an army of attorneys whose sole purpose in life is to protect LL (and you) from harm.

    Additionally, section 5 of the TOS is a good read for the aforementioned individuals.

    In closing: The initial paragraph within the TOS reads, “If you do not so agree, you should decline this agreement, in which case you are prohibited from accessing or using Second Life.” That says it all.

  40. Gil Polydactyle says:

    LOVE the trend line on the first graph. Was that drawn in by hand? By someone’e kids? Using wax crayons? Even at a casual glance you can see growth has turned down.

    I’m not surprised. I’ve had three businesses now destroyed overnight by different, arbitrary, knee-jerk, Linden messing-with-the-economy, whammies. I’m fed up with funding Philip’s retirement. There won’t be a fourth.

  41. janeforyou Barbara says:

    I dont know what kind of business in SL that got ruind over night by TOS changing..but regulation of business can happen in SL as in RL
    If you cant change the way you do a business in SL or in RL you got little chance to do any. If you are a creator of items you can change,,if you own land you can change–The bank ppl was not as i se it a “business” it was a fraud–The casinoes was more or less places to ripp ppl off, and this places had good time and warings to change- Legal business in SL good good chanses if you admin it right

    You need to se the marked, you need to do the groundwork and right marketing and you need to be huble and listen to what your costumers tell you-information = cash!

  42. U M says:

    Why are you quoting TOS? Most people understand them and obey it…There id no real growth. If we see the subjections or users along withthe gains thenI say there would be a Neg factor. Not positive…..

  43. Lem Skall says:

    “Even with all the data we publish, its funny sometimes to see how people get it wrong”

    In what way exactly did we get it wrong? Simply by disagreeing with it?

    Thank you for being transparent with data about OUR economy (you know, “your world, your imagination”). How about some transparency about governance decisions like the ban on unregulated banks? Which would still be about US, not about the LL as a corporation. We saw that kind of transparency anyway when Cory was terminated and the decision would not be justified even internally.

  44. Gregg Niven says:

    Well impressive as the ‘Graphs’ are, I fully disagree.

    I have been in world over one year, and in this time have witnessed countless business closings, many many avatars self exiling and migrating away.

    Land is a joke, the price is insanely high, no resale value. Quality of the virtual world has rapidly decreased in stability for the last 6 months.

    Many of my friends are original content providers to SL from day one. Many have rolled up their carpets, packed teir bags, and left SL permanently.

    My business has shown a dramatic decline tho new scripting and products continue to come forth. People are NOT spending money at all. Activities are slowly loosing interest, live music is also loosing its appeal.

    I understand the TOS, and Linden may do as they see fit. However, should this Morality continue I for one predict a total collapse of the economy. This IS a real world economy we are talking about, even if it exists only in our minds.

    Issues to bolster the economy in my opinion are simple.
    1) Regulate land, set prices from LL when released to a realistic ‘cost of living’ guideline. Any user can be a land baron and rob his fellow man, but honestly Linden Labs should when originally releasing new land set the prices realistically. Islands are at a ridiculous price, and the land auction is a virtual and real world JOKE.

    2) Campers, who cares! If a person wishes to pay $L2 every 10 minutes that is their business. HOWEVER…. free accounts should be regulated as such – A fair TRIAL period which allows a person to explore and experience the virtual world, and then MANDATORY payment to continue. This if implemented will show a SIGNIFICANT reduction in lag and performance issues, not to mention give true statistics.

    3) Realistic Expectation. This means quite plainly that we as users should be afforded realistic expectation to receive the quality we pay for. Hire the best of the best, programmers that can correct long term issues, inject new vibrant codes/ideas, and by all means make the next viewer update WORK.

    4) Incentive Bonus. Yes a bonus! Users who create quality business’ within second life, original content not resale full perm garbage, should be afforded a bonus, as in free monthly premiums, perhaps a bonus in stipend, something to draw new and creative content to the forefront of our virtual society. In the real world, towns, cities, countries, offer huge tax breaks for business’ that will create jobs and merchandise to bolster a lagging economy.

    In short, yes LL is a business. We understand that. However, if LL chooses to regulate and propagate the idea that this is a REAL society, with a REAL economy, perhaps the corporation should begin running this business like the REAL country/world that it is. We are the nation of Second Life, and as such should be treated in the same manner. If LL ran SL as if it were a true independent nation, wow what a difference we could experience!!

    LL I give u applause for the Second Life Platform, but alas, evolution has reared its ugly head. Shall we GROW with these new changes? Or shall we simply allow ourselves to become extinct and be replaced by new breeds emerging like Hipihi, etc.???

    Evolution, revolution, inovation, change, progress, or extinction. The choice is clearly up to you Linden Labs. What say you?

  45. Gully Miles says:

    @39: It’s very interesting that you quote section 1.6 from the ToS, in the context of a discussion of the economy.

    There are many real life examples of governments messing with their countries’ economies — the Zimbabwean goverment trying to outlaw inflation while making political decisions that have destroyed their agricultural base; Argentina’s government being forced to devalue their currency; the UK government withdrawing from the Exchange Rate Mechanism; Venezuelan oil fields being forcibly nationalised — and when this happens we all tut about what a mess they’ve got themselves into and how it will damage investor confidence and economic growth.

    Of course sometimes these things have to happen for important reasons, political or otherwise — but, every time they do, the economy suffers as a result. Economic stability and growth requires investor confidence. People need to have some sense that they are able to build something of value, and that it won’t be taken away from them through instant decisions over which they have no control or right of redress.

    Why would anyone build a significant-sized business for real in SL, any more than they would in Zimbabwe? They know that it only exists for as long as Linden goodwill allows, and that at any time the parameters of the Second Life experience can be changed in a way that makes their business poof out of existence. And don’t forget the anti-fraud measures, etc. that serve to underline the fact that your “money” is just tokens — which can be taken out of your account without warning, as a result of alleged activity on the part of others over which you have no control.

    So yes, you’re right; the ToS do basically say “we can do what we like, with no warning; and if you don’t like it, don’t come in.” And for as long as it says that, it will act as a limiter on economic growth, just as much as the technical instability does.

  46. That red arrow would appear even sharper back in July. I don’t trust the arrow there. Looks like it was just slapped on. Who is to say that next month wouldn’t be even lower just like August was? Gambling was shut down in July. This month, banking will be shut down having a further impact on our economy. This post appears pretty optimistic ignoring the fact of the banking ban.

  47. Pie Psaltery says:

    Funny how numbers can be made to say anything you want them to say.

    Your numbers say “solid growth”, yet if you go to your own website forums you can hear your residents saying “sales are down”, “bots spoil real business” and other grumblings about the SL economy.

    Who are you going to believe, numbers or people?

    Who did you build this platform for, numbers or people?

  48. Mykell Ackland says:

    And yet teleporting STILL isn’t fixed. Just tried to TP somewhere *5* times, each one kicking me out of the program. What about using some of those millions of dollars to add a single line of code in that, y’know, sees if TPing is possible and if not cancels it before SL crashes? Or is the money being diverted to fancy graphs instead?

  49. Deltango Vale says:

    2007 was a difficult year for Second Life. 2008’s not looking much better.

    The establishment of anonymous accounts in June 2006 opened the doors to underage players. This resulted in international legal scrutiny, increased exposure to legal liability and damaging media coverage. Linden Lab responded by intruding into residents’ sexual relationships and expelling two consenting adults for underage roleplay – even though no underage players were involved. Refusal to close the anonymous accounts and dogged insistence on an ineffective and unsound ID-based age verification system cost Linden Lab considerable political capital with no benefit. ID-based age verification is no better at screening underage players that credit-card verification, nor is it more ‘fair’. It rarely works for residents outside their home jurisdictions and, in many countries, it may not even be legal.

    While anonymous accounts may have launched Second Life’s dramatic growth phase (October 2006 to June 2007), failure to formulate a land management strategy resulted in a speculative bubble as Linden Lab first starved and then flooded the mainland market. Islands ceased to be an attractive alternative when LL raised tier charges from $195 to $295 early in the cycle. Worst affected were the very residents who comprised the growth phase. The unexpected policy reversal on gambling in July further undermined Linden Lab’s credibility. Growth stopped. Premium accounts and total hours remained flat throughout the second half of 2007.

    The overnight imposition of VAT (15-25% sales tax) on European residents (40% of SL’s population) in September not only trashed European landowners, but it caused considerable friction between European and North American residents as Linden Lab, a supposedly global company, began charging based on regional factor prices. It also led to the crazy situation whereby European landowners (some owning dozens of islands) who shifted their tier to North American business partners lost access to Live Chat support.

    Longstanding problems of asset management, grid instability and poor customer service have undermined residents’ confidence in Second Life’s entire technological and managerial infrastructure. While organic development was the correct approach to building Second Life, expectations of success amplified perceptions of failure. The year ended with the resignation of CTO Cory Ondrejka due to “irreconcilable differences” with CEO Philip Rosedale.

    Just days into 2008, without consultation or discrimination, Linden Lab banned all banks, regardless of their history, reputation, structure or business practices. In a matter of minutes, SL’s evolving financial system was demolished as sound and responsible banks closed their doors in the ensuing panic. More residents lost money because of LL’s clumsy intervention than from all bank frauds combined. Good businesses were crippled and good people hurt – not so much by scammers as by Linden Lab itself!

    So, what went wrong?

    Philip Rosedale and the Board of Directors are highly skilled engineers with little or no knowledge of economics, economic history, strategic planning or customer relations. As Second Life grows from a technological startup to a mature business, they are out of their depth. They are making serious mistakes. They are destroying the wealth and confidence of the entrepreneurial class who risked enormous time and money to build Second Life in the first place. More importantly, they have lost sight of their original vision.

    Second Life was about user-generated content, remember? It was about “your world, your imagination”. That was the business plan and founding principle: to create a world that was VIRTUAL, VOLUNTARY and ADULT – framed by the philosophy of individual liberty and responsibility. Second Life was NOT intended to be a pale imitation of real life. It was NOT meant to be a playground for Republicans and Democrats to ‘govern’. It was NOT about majority rule through public opinion. Yet this is what has leaked into Second Life since 2007, drip, drip, drip. The sad irony is that now, out of ignorance and a naive desire to ‘do good’, Linden Lab is poisoning the very world they created and seek to protect.

    How do we fix it?

    Linden Lab is a private company, so they can do with Second Life what they wish. We ‘residents’ have the choice of being here or not. At the moment, there is no viable alternative to SL as a comprehensive virtual world. Therefore, Linden Lab still has time to prevent Second Life from becoming the ‘Lotus 123’ or ‘WordPerfect’ of the virtual universe.

    1) Regain integrity of the system. Announce the closure of all anonymous accounts on 1 March 2008. ‘Anonymous’ accounts may now be described as accounts without payment information on file or have not been age verified through the ID scheme. Keep the ID scheme during the transition process, but consider phasing it out by the end of the year and returning to credit card verification.

    2) Stabilize the financial system. Lift the ban on banks. Present the following message on the login screen: “Rate of return (interest or profit) on any investment is proportional to the amount invested, the length of time invested and the RISK OF NONPAYMENT.” Give residents information, not regulation, and the system will evolve in a healthy and productive way. Reputable businesses providing good customer services will always prevail against fly-by-night operations.

    3) Reassert the founding principles of individual liberty and individual responsibility. Resist the temptation to sanitize Second Life. The road to hell is paved with good intentions; the desire to protect residents from themselves will only lead to a downward spiral of regulations to offset the harmful effects of other regulations. Also, Second Life is NOT real life. It is NOT a nation-state. Second Life is virtual, voluntary and adult. We are here by choice precisely to escape the restrictions of real life – and there is no Berlin Wall to prevent us from leaving. As for those who want SL to become more like Disneyland, well, Disneyland already exists. We don’t need another one.

  50. Istephanija Munro says:

    I am not sure if teleports or land crossing would have a noticeable impact on the economy. I totally agree with AnnMarie Otoole (#3)
    SL has to become more mature, content should matter and since we have to pay to create something we should be allowed to charge for it.

    Do the math, lets assume there are 200k active people and the net amount spent is 6 Million that means every resident is spending 3 USD per month! Hell thats nothing!

    If one has a real cool club with a top notch DJ, one has to make a contest and give away free money that people come in the first place, these contests are usually rigged because these contest cheater groups. Charging admission for an entertaining program sounds about right. I doubt the cheater groups would pay admission to place their vote, less malls would be necessary to pay the tier, less malls means more relevance in the searches etc. The popular places are either free sex places, free money or freebies. What’s free works for traffic but doesn’t work for the economy.

    If LL would really like to boost the economy they had to ban products for 0L$. If just every current freebie would cost 1L$ a newbie had to make a decision to use the credit card or sitting ages on a camping bench. As a real woman I am worried about the behavior of the men that feel anonymous. I kinda lost my faith in humanity just by standing at my store from 2000 daily visitors 1000 of them are male that say nice things like (show me your boobies) i have to clean my banlist every 3 days because it is full. Basic accounts should be considered a 1 month free trial and after that they should be forced to upgrade. By having the real names on file this rude behavior would change, creators would have more financial resources to create REAL content and so on… but in a world that works this way i understand that the most people won’t agree with that idea, anyways from the economical and ethical aspects it would help a lot

  51. Musimba Yellowknife says:

    According to your chart, there was solid growth in Q1, but the rest of the year was ups and downs. Q4 was alright. Lets see what happens over the next couple of quarters.

  52. Chaz Longstaff says:

    While we are all used to lag, particularly on the mainland, and “solve” the problem by simply avoiding those areas like the plague, and so discount it in our thinking as “just another thing not worth complaining about”, like the weather…. we mustn’t forget the impact of lag on the economy. Stores and malls in which you can’t walk because it’s like molasses, or in which despite waiting patiently for more than a minute, over half the things on offer are still grey and so you can’t see them. And so, you’re out of there. Maybe you spend your money somewhere else; maybe you just give up.

    And maybe, the answer to this isn’t something the Lindens can provide. As in the early days of the Internet, when people tried browsing the web with 56k modems, many said “this will never take off, too slow.” But now with high speed, it’s a different world. Perhaps thus as well as people’s video cards improve, if only to take advantage of Vista’s Aero interface and SL benefits as a side-effect. But still, I made sure I got a kick-butt graphics card, and am on 8 meg down high speed, and still flee from molassy, grey malls.

    In any event, whatever the cause, and whatever the answer, and even though we’ve learnt to live with it so that we learn to avoid it, the effect of lag on the SL economy must surely always be there as a damper.

  53. MrLunk voom says:

    Land Sales by Resident

    December 2007 6.2988
    January 2008 6.4057

    wow landprice gone up ?

  54. Lear Cale says:

    PLEASE POST GROWTH CHARTS USING LOG SCALES!

    In a log chart, steady growth appears as a straight line, sloping upward.

    Linear charts distort growth. Steady growth looks like a curve with all the apparent growth at the end of the chart. A chart showing what *looks* like steady growth (with the values increasing steadily, a straight line sloping upward) hides the fact that the growth rate is declining.

    Please, if you’re going to post charts, do it as though you have a clue what the data means and how to present it.

    Yes, most folks don’t really understand log charts. But they don’t really need to; plotting growth on a log chart makes the important information (the GROWTH RATE) visually apparent and intuitive, even to the mathematically challenged.

  55. Pingback: Virtual Worlds Forum Blog » Blog Archive » Linden Lab reveals latest Second Life economic metrics

  56. Redmoonblade says:

    P-p-p-profit

  57. Pingback: Massively

  58. What you really mean is that spending has just about recovered to the levels of ten months ago, but there are more users, so per capita spending is LOWER. Under most definitions, that’s a recession. Caused of couse by not only those non-transparent and sudden policy shifts, but the worsening performance.

    What it also shows, is DROPS as new shinies were added, not growth. You know, a year spent ignoring users, including the Open Letter, until Philip’s sudden about face in his end of year statement that LL will concentrate on stability and happy customers rather than shinies, once of course, ou have brought on board this laggy mess called Windlight.

    Not checked them yet, but have you reincluded those unique user numbers, and by country. Odd how they were very useful while SL was growing, but the instant they fell in October, were suddenly deemed “unreliable” and scrapped. The reliability is not so important, as trend. There is no reason to assume that any errors are not consistent from month to month, making relative changes valid statistically.

    From your own graph, user hours are flattening. But there are other important numbers: churn rate of premiums for example, where you seem to be losing 10-15% of Premiums per month, hidden by new ones coming in. Of course, you are far from transparent with all the numbers, so that we can make proper analyses, but at least the ones you do are a step in the right direction.

    What is clear, is that something has panicked Linden Labs into suddenly trying to be customer friendly, giving more info, and that volte face on shinies vs performance. Perhaps it’s dropping user numbers (particularly in Europe, which saw a loss of over a third in most European countries since Key Metrics came out, maybe due to the US centric policy, difficulty in buying/cashing Lindens, lack of language support, VAT and generally unfriendly support for Euro hours when they make up the vast majority of customers), dropping income, or a good competitior just around the corner, or maybe all three?

    If you were really transparent, you’d tell us the real reasons for Cory’s leaving, and Philip’s about turn…

  59. So lets see: solid economic growth, but any bank interest over 0% is “Unsustainable” by the definition set by LL? Sorry, that dog don’t hunt.

  60. Anonymous says:

    ——————————
    ’d love to see our registrations, active users, user hours, economic activity and anything else comparable on lots of virtual world and MMORPGs. I’m sure some of the data is out there – and I’d love to see what you can find. Please post links to others data in the comments or send them directly to me (Zee Linden) inworld.
    ——————————-

    Hmmmm.. Followed your request and posted links to blog posts detailing how the “Big 3” MMOs now routinely host over 1 million concurrent users.

    Added links to both Google trends charts and Alexa traffic data showing that interest to “secondlife.com” has declined 50 percent in the past year.

    Additionally linked to data showing that the number of ‘active residents’ (yes, I know the correct term is CUSTOMERS) has declined by over 30 percent in the last 6 months.

    Result? Comment ‘held for moderation’!!! Guess that telling the truth ‘busts the rules’ :^)

  61. Oh, up until Q1, concurrency followed total users at about 1%, until you had that three month stagnation at around 38K, since then, concurrency has continued to drop (like average number of avatars per sim too for example, Last 60 Day :Logins dropping etc etc). So if it was still tracking that, we’d have 120K concurrency today with 12 million users, instead we have just half of that, yet another drop in numbers, so not worth waving the flags too much…

  62. Bobo Decosta says:

    Looks like sl missed it’s financial growth everything seemed to be rising intil the casino ban comes in place. After that you can only see a modest growth. Like you see they even had to add an arrow to make it look like solid growth.

  63. Mortus Allen says:

    People complain about Sim Crossing (Yes they are annoying.), Lost Inventory (They ARE actually working on that you know!), and Teleports. Perhaps a slowing of growth IS a good thing in this area as it allowed LL to get up to speed and perhaps even ahead of the growth.

  64. Nice to see SL economy getting back in December to the level it dropped from in March 🙂

    Lets see if we can keep that level and grow from it in 2008.

  65. shawnwirtz tiki says:

    After many communications with many businesss owners who are giving up in second life due to the theft of their products they created being sold by theifs who make enough profit they can buy a top classified ad
    there many skin creators are no longer creating new additions because they dont want to see their work 2 weeks later in the well known high profile rip off artist stores. Please add some type of SL registration of creations and brand name and unique store/brand name in SL registration. Charge a dollar so creators can register their creation and for those wanting to register a unique brand or store name a couple hundered dollars and this registration means that if anyone else copies/rips or uses the registered in SL name or product then they will be terminated. People cannot afford to pay trade mark in RL fees and many people are not in the USA to do the whole trade mark thing/ copyright thing… Make a SL trademark copyright registration and the fees go to pay the linden lab employee who is in charge of it. The main topic of creators in sl is that they no longer have the desire to create because the theifs openly steal and sell copied products to the point they pay the top classified fees.

    Please consider putting up a registration for SL trademark/copyright of product and brand name so that creators once again have the desire to create knowing they can register their creation or brand name with SL inworld registration and if anyone rips them off they have confidence the rip off artist will be shut down

  66. Sven Okonomi says:

    They are doing their best to kill the economy with stupid legality questions though. Casinos, Banks, and soon even a little adult entertainment will be running into alot of trouble. And I can just smell the freaking IRS sticking their fat nose into SL soon..

    Damn, LL… Just move the servers to a less anal country like the netherlands or something and remove the restrictions that choke us..

  67. Ralph Doctorow says:

    Personally, I’m very encouraged by the current direction SL seems to be going in, the experience seems to be improving again.

    I’m very concerned though about the trend in premium accounts, it’s really pretty flat, only about 500 net gain per month for the last 4 months. Having fewer than 100K people in the world who are willing to make an investment in SL is not good.

  68. Novis Dyrssen says:

    “I really enjoy the fact that we are such a transparent company”

    Too bad you are only transparent either in retrospect or if the transparency suits your purposes. I am sorry, I really do love your idea and the product you created, despite all the lag and errors and continuing issues. But the way you run your company just… sucks. At least for us paying customers.

  69. Argent Stonecutter says:

    The second graph is actually quite interesting. The user-hours graph is following a classic resource-saturation “s” curve… early exponential growth followed by an asymptotic approach to the resource limit. The concurrency graph, on the other hand, seems to have had three separate resource saturation events in 2007, smoothly flattening out in March, June, and November, with new resources (additional servers, better software, whatever was required to allow more concurrent users) in April and August.

    This implies to me that if it wasn’t for the bottlenecks … the performance issues … concurrency and user hours would likely have increased exponentially throughout 2007, and the top graph would have followed. That implies to me that Linden Labs needs to do something really drastic to deal with lag. I’m talking about actually splitting the grid, and having separate grids each with their own asset servers. I’m talking about having to leave your inventory behind in your home grid, carrying only what you have in your attachments, or pay in money or time to transfer assets from grid to grid. I realize this breaks from the “one world” model, but I’m afraid that model just isn’t scaling up.

  70. Lion Ewry says:

    I don’t think many are buying the numbers, sorry.

    If you want to really be transparent as you say–give us the numbers adjusted to Unique People that are in Second life.

    Currency transactions peaked last march and have been flat ever since.

    User hours appear to have peaked and flattened, but they have to actually be down because of the ten’s of thousands of Alts floating
    in skyboxes–(a lot of them are there 24/7)

    Sorry to say it, but I think overall credibility is going south.

  71. Blinders Off says:

    Well, after one day of reading the above posts, one this is very clear:

    Linden Lab, your customers are not as gullible and stupid as you seem to think they are.

    Now three years ago, I’d say yeah, you could get away with this nonsense. But the above posts are for the majority very intelligent, very insightful, and call a brick a brick.

    You see, some of us did go to high school. Why, some of use even went to college and *gasp* took statistical analysis courses.

    Shocking I know, but the next time you decide to put out a PR chart to make LL look good, please remember that a number of your customers can actually analyze that information and come up with the facts… and they ain’t pretty. LOL

    Look, I know you folks want your board to succeed. I know you’re enthusiastic about SL. Want to reallly do some good? Hire a couple of us that aren’t butt-kissers to tell you the real scoop from day to day. Get in a couple of bottom-line, everyday SL users who know what’s what to play the Devil’s advocate. You need some folks like that, someone who doesn’t toe the Linden Lab propaganda line, to help you keep your center and focus on projects that REALLY need to be accomplished.

    In order to make SL work, you need to stop thinking like a Linden… and thinking like a user.

  72. Blinders Off says:

    ooops… and START thinking like a user. :DDD

    My bad. But hey, good points deserve to be made twice. 😀

    If your company starts asking itself, “If I were a customer, how would I want SL to operate”… you might actually pull it out of the predictable nosedive.

    What nosedive? The one SL is already in (performance is blah) and the steep nosedive it’s going to take the moment your competition opens its doors. Which looks to be happening pretty soon now.

  73. Detox Watanabe says:

    erm lindens go get someone who knows how chart technics works. geez

    1st image: no real growth since march. that is 9 months (yes, like a baby).

    conclusion: after the large media hype end of 2006 and 2007 interest in SL stagnated. why? maybe because we’re still on havok4 and WL came a bit late (and still isnt there properly).
    out of 20 people I know IRL only one stayed in SL (that is me).

    now since you are not interested in certain forms of media hype that definately increased the interest in sl (–> see IDV and similar for a hint), you maybe want to create a new way of attracting people. but first do your homework, that is: make WL and Havok4 running perfectly.

  74. Detox Watanabe says:

    edit: havok1 it is, of course. hard to believe, isnt it? xD

  75. Lion Ewry says:

    I agree with the post about listening to the Users of SL instead of the
    people that write the code. And since this is about the Economy, that means the people trying to run businesses here. You’d see things a lot different if you were trying to do that too.

  76. les says:

    I lurve the red arrow. Where did you learn that? Propaganda for Dummies?

    ‘Scuze me while I rant a little…

    Must you guys spin every thing? If your CEO spoke the truth his head would explode.

    Millions of users! Or is it 500,000? 9000 CPUs? Or is it 2500 under performing quad core CPUs?

    “SL is great for business’ collaborative use!” (CEO’s year end statement)

    Know what? It SUCKS for collaborative use. You fail to introduce HTML on a prim after YEARS. We can’t even share a google doc in game. You fail to introduce shared applications as can be seen in croquet, wonderland and any other platform with a future.

    You dangle the future and don’t deliver. Mono will increase script speed 100%…in the year 2000 and never. Shortly after havok4 and HTML on a prim is introduced no doubt. (Sorry Andrew, but try to finish it before I die. K?)

    You fail to devise a clean scheme to meter CPU resources and have every resident complaining of lag. You allow any account to use as much CPU as they care to with unlimited scripted attachments. You lock up the build system and try to keep objects “residents own” inside the game with proprietary garbage like the lag infested, very un-optimized sculpts.

    You produce Video Tutorials on how to log on with multiple clients. You place the “New Account” button over the “Log On” button showing your preference. You wave the smokey Total Residents number like a flag made out of tissue paper in the rain. You allow “griefing” people to create a new avatar in 3 minutes to return to their pleasure (+1 Resident!). You fail to remove the seedy Traffic numbers as requested by all because of all the logged on bots used to generate the Traffic and there for increase the online numbers. You claim it’s 18+ age requirement then remove the restriction from the front door and place it on “land” owners so it’s only in effect after more Residents are generated. So on, so on…

    The worst thing you ever did, Mr. Zee, was decide that “business’ were willing to pay much more for a sim” and jack the price 50% over night therefor shutting out a lot of the little guys who MAKE THIS PLACE. And guess what? Business have moved past the media shine and found out that SL sucks for their needs and split. Must you charge 6700 just to turn a shared server on? You are generating 1200$ a month from these under performing servers with the effect of killing start ups.

    You seem to be in maintenance mode now. Holding onto 2006 as long as you can. Tied down to the moronic “Land” market, 256m sims and lindex sales.

    “Milk it till it’s dry”, seems to be the plan here. I’m sure LL’s officers will have a nice soft landing on a REAL private island somewhere when this all folds.

    Do you care to dispute any of these observations?

    One last thing…name a new CTO already so those of us interested in the future might actually see one!

    OK, I’m done ranting.

    Inspite of all this continued miss-handling…I’m still here, but like many, it’s only due to a lack of options and a lurve for red arrows.

    That really is a nice arrow!

  77. Argent Stonecutter says:

    @76 les: HTML on a prim is the kind of halfway hack that leads to more lag, lower performance, and lower security… and in the end a less reliable client. They’re having to roll back the HTML login screen already.

    For collaboration, they need to extend the existing media texture scheme to allow client-local media textures that can be driven by local programs, so you can integrate *any* collaborative tool into the client as a shared resource, but under local control.

    For the rest of the uses of HTML on a prim, what they need to do is to improve the ability of LSL scripts to control prim textures, with efficient calls to directly bake text and geometrical objects into textures in the client.

  78. la le lu says:

    i really hope to see an official statement of the board on this blog comments.

    on those who like to cut non-premium users: thats the total wrong way, the right way is an improved architecture which can handle masses of users. to those who like to ban bots. thats the total wrong way, bots can be very useful tools. if they are just for increasing traffic, then it would be good to get rid of the traffic statistic scheme for a better ranking.

    in the last year i managed to make my living out of second life as a system engineer for a couple of agencies. i like my jobs but i fear more and more companies loosing interests in second life and i don’t get new contracts. if contracts stay out i need to move. far away from sl. back to unix/linux system engineering. and i will invest my time in opencroquet.org. that has potential because it’s a lean and distributed 3d space, and they already come with web clients in-world. squeak/smalltalk is not a mickey mouse language like lsl, it’s serious with a long tradition and good reputation.

    but anyways, i guess we will not get an official statement. it’s like always. keep the ‘business’ as usual.

  79. mimi says:

    i agree with shawnwirtz tiki

    I was shocked to see a shop full of stolen items in the top 10 classifieds, I find it even more shocking to see its STILL there after many weeks.

    Something needs to be done or we will lose more business than we have already. Its no wonder less and less people spend money on items, since many of the once popular, now ripped items can be found for free now in about any mall. Why pay for an item that you can get for free?

  80. I found the statistics to be encouraging only in that they seemed to show some stabilization, and I am still trying to figure out if they reflect real growth or not.

    A year ago I stepped out on a limb and started selling my virtual castles and stuff in SL as a full time job, and at first business was booming. Yes all the SL generated economic mistakes really impacted me but I stuck with it, because this content creation stuff was not only fun, but it felt like I could get money through my own hard work, not by being friends with the boss, or whatever ridiculous social work patterns occur in RL. I was the boss, the customer was my priority. I even had regular work with developers grooming corporate sims, and machinimas. For a few months life was good, my risk had paid off.

    In the early part of last year I remember people groaning about the the way the “ONLINE NOW” figure was leaping up 5k per month, stressing the servers, etc. I was secretly rubbing my hands with glee, money, money, money! then it stalled, I think around May . . .just stopped going up, stalled around 50k. It has grown, but so slowly as to be almost unnoticeable . . . back in July I commented on one of these blogs that it should have well exceeded 60k ONLINE NOW to really reflect the population growth rates as portrayed in these transparent metrics. By now 80k ONLINE NOW should have been a regular occurrence every weekend (or more). I saw it tip over the 60k ONLINE NOW mark last weekend, briefly. lol bfd. That’s what I watch, maybe I’m wrong, especially now since some of that figure might just be mindless, unproductive, parasitic bots.

    So I read what La Le Lu wrote on line 78 ( if the Lindens don’t cut it) and I find what I have been both afraid of, and hoping for, a viable virtual world that could hand SL it’s knickers on a platter, and provide the true entrepreneurial environment so many of us are looking for. Yeah it’s in it’s early stages, but so was Second Life when it started putting the screws to TSO and sucking their population away by the thousands ( and well deserved every new person they took)

    opencroquet.org , looks like sheriff linden better stop polishing his metrics and start polishing his gun, there can be only one Internet 3.

    I will keep my eye on them, but keep my business in SL for now, in the mean time I am looking for RL employment to cover what my work in SL used to cover. I really hope SL keeps growing steadily, and that content creators like me can still make a living here, because it would be easier than moving it all over to some other world. Read what people are saying here LL, it might just save your jobs.

  81. Pingback: Second Life economy does not need a “shot in the arm” « Electric Sheep Dreaming

  82. John klaar says:

    @ 65 shawnwirtz tiki

    I totally agree too. There should be some kind inworld copyright solution or at least a simple way to check who was the creator first so copies can just be deleted and the copiers can be banned or something. This ‘ skin soul’ rip off store is still on the frontpage, which is REALLY a shame since it’s all ilegally copied stuff. Skins creators filed dmca’s but nothing has been done in MONTHS.

  83. Classifieds Junkie says:

    Hi there,

    I am wondering how the removal of classifieds from the all search tab will impact the economy as a whole.

    I worked a lot with them but since they have been removed from ALL my revenues went down by 20 to 25%. Not sure how others feel about it but i will cut my cost on that and spam the all search with events from on, like others do. As far as i can see this was the most stupid move concerning the new search concept and i strongly believe it was not a business decision but a technicality that made you remove it. (Which is always poor conduct btw)

    I think with the ALL search you started good and now screwed it up for good LL and you will (hopefully) feel the pain in Q1 and Q2.

    Also have you got a statistic available, that can show how much of the revenues in Q4 went to the large sl businesses, i.e. the ones that are fighting for the top 8 classifieds, and how much goes to the rest?

    I would assume the “rich ones” are laughing and the vast majority of other business owners and especially mall owners is not. So i seriously doubt when you talk about solid growth.

    It´s more & more becoming like rl here…Just cold blooded jungle law and disinformation by the powers to be.

    I also strongly believe IDV (=sl killer) is short before the final release. Because SL PR is like from a micro micro cap on the stock market. Whenever there are unusually good news posted, something really bad is about to arrive.

    We´ll see, may be sl just made me paranoid meanwhile.

    Greetings

  84. U M says:

    “79 mimi Says:

    January 18th, 2008 at 4:28 PM PST
    i agree with shawnwirtz tiki

    I was shocked to see a shop full of stolen items in the top 10 classifieds, I find it even more shocking to see its STILL there after many weeks.

    Something needs to be done or we will lose more business than we have already. Its no wonder less and less people spend money on items, since many of the once popular, now ripped items can be found for free now in about any mall. Why pay for an item that you can get for free?”

    This is sad event happening all around sl these days. And LL doesnt care. Well think about it……….LL need have things for free for all those freebie accounts unwilling to paying anything for right?!. Thats why LL will not do anything about this issue. Why should they? it helps them retent users and shows login number for 60 days higher and higher every month. regaurdless if they are bots or not. Why do you think building are giving up. not all but the numbers are growing every month.

  85. Hal Harbour says:

    Look, that red line. You shouldn’t, you really shouldn’t. It’s not deception or anything – you’ve shown the data bars so anybody can see – but it just makes you look silly. NOBODY thinks that the red line can be the underlying growth curve. The basic story is a reasonable one – this particular metric was in decline, now it’s in growth again. (You might use a moving average, or log scales, or a power growth on linear scale, or an S-shaped curve… all would have fitted reasonably. But the red line makes it look like a washing powder advert).

  86. Lion Ewry says:

    I have thought about this all night. SL is very important to me. I am a retired Economist, Statistictian and Computer programer. I’ve been here for more than a year. I owned two stores—-I closed one of them last week and sold the land. I am thinking of closing the other one.

    The reason is simple—–LL created this wonderful environment, but is not standing behind the people that helped make it great.

    I’ve had reports that every one of the things I created has been stolen and is being sold at prices way below mine. I’ve gone to some of those places and when I confront the ones doing it I am laughed at because they know LL will not do a thing. The stores that are doing that also game the search engines.

    I basically have to start over after a year’s work (If I am going to stay at all).

    Now these numbers——and the spin put on them! Wow. This economy has not grown for 9 months. Users on line is at least 1/3 alts and since you taught people how to create them at will last week, residents on line could be approaching 50% alts now. So User hours of real people on line is no where close to what you are showing here.

    LL–do you suppose, you might feel a tad bit betrayed like all the others that have posted here? Or do you believe that we are simply stupid and will keep pouring money into LL regardless? Hmmm?

    LL–whether you realise it or not (or care) you have done very little to protect the people that helped SL become what it is. A tremendous amount of damage has already been done and you are seeing some rebellion. If you lose that trust completely. You will not get it back.

  87. hmmm… the curves shown are not exactly exponential, they both show a much lower slope in Q3-Q4. This is a clear evidence that the growth has reached another mode, where it is much slower.

    Is this a problem? is this alarming? May be, may be not.

    Until now, Second Life has no real competitors. Multiverse, OpenSim, etc… are all in beta, only HiPiHi could be chalenging, but it is still a much lower quality and experience than Second Life. So competition is not the explanation.

    Bugs and viewer quality? This has been a constant problem, which did not popped out in mid-2007. Anyway these problems don’t prevent whose with a real Second Life to log in the game.

    My opinion is rather that Second Life is reaching a step of maturity. Gambling was expelled (good point) and probably with it many people who were in Second Life for similar activities. Paedophilia too was expelled, and this was a great improve in Second Life reputation, atracting worthy users and repelling others.

    So less growth, but more quality. Now come in Second Life those who have something creative to do in it, not just to use the game while bringing nothing in it. The growth is less in number, but more in user experience.

  88. I look at the red line and think, “you can’t be serious.”

    And then I realize that these graphs are not for us.

    If you are going to hire a statistician, I hope to God that they have at least produced data that is meaningful to you behind closed doors. Because this raw data, any high school kid could make it. But it doesn’t reflect meaningful analysis – you’ve taken away the unique user count, you don’t figure in LindeX activity per capita which would show a significant decrease in the willful spending power of the populace. Where’s the downward trend of premium accounts?? Not pretty to show the big red arrow going down?

    The worst lies are the ones you tell yourself.

  89. Tristin Mikazuki says:

    Hey ya jave to give the credit.. it IS a pretty red arrow!

  90. HooAmI says:

    Transparency (HUH) never had an issue or problem dealt with at all just dragged out and forgotten about or invisible resolution that only you are aware of.Abuse reports what information is there really to know what has actually taken place for the person who places the report,your police blotter top stuff,fruad is rife and none payment between sl community members ,what do you do,IGNORE IT(WILL YOU IGNORE THIS THOUGH 🙂

  91. Brandon Catteneo says:

    A good overview of what the industry players think of trends ahead:

    http://www.virtualworldsmanagement.com/forecast2008/overview.html

    Comment: Having read all the ideas and initiatives these people are putting together it occurs to me most of what is being done on other platforms can be done with Linden technology. SL has shown an amazing ability to adapt and if you took a snapshot of SL in 2005 and compared it to what we have now they are worlds apart (pardon the pun).

    SL is a virtual world, and shouldn’t be compared to an MMORPG, as it does not qualify as a game. There is no objective, and more to the point the “players” have created most of the “game”. People play WoW or EVE or AO for pure entertainment; to blow things up, to kill monsters, to go on quests. There is nothing to kill or blow up in SL, so it would be a pretty boring MMORPG, and the level of human interaction and creativity possible in MMORPGs is miniscule compared to SL.

    If anything, SL is a cybernetic extension of the game of life.

  92. Tegg B says:

    This graph shows whats going through,, what’s the chance of showing how much is going in and how much is going out?

  93. @ Brandon (91) , your link http://www.virtualworldsmanagement.com/forecast2008/overview.html
    seems to cope mainly with business.
    Virtual worlds are not a business per se, business is only here to support the platforms and required work to run them.

    What makes Second Life SO different of most video games is that we express ourselves in, and have life experiences in that we cannot have in RL. Whatever this life experience is beauty,social, science, etc. People who are creative or sensitive can have an interesting experience in SL, while people who are unable to have a social life or creativity feel that SL is empty. (type in search any family name and see how many people went in SL just some hours and then left it)

    What I think is that there is an invisible curve, not shown on the graphs above, which would show the number of people able to master a successful Second Like experience. This curve has a much lower slope, although it is significantly growing with time. (a former plot of this curve was given by the french “deuxième monde” experience, which started from zero in 1997 and ended at 1000 people in 2000)

    What happens now is that Second Life, started later, has known a very fast growth, until it reached the invisible curve, until it reached all the people able to get seriously involved in. so now the growh will be slower, depending on how many people maturate to the point of having a real experience in SL.

    But these people will require a better quality and reliability of the platform.

  94. Also, we don’t really need in SL:
    -griefers
    -people who just come in there to have “their home” and forbid any access to “their land” and have no social life. But yes, they pay, to the countrary of griefers
    -people who just come here to earn money. Many people define SL as a place where “one can buy things and make business”. This is not true. What makes at first the value of SL is our experience. If some work is required to better this experience, business can be a reply. But business cannot be the primary reason. If there was no social life, we would not need clothes and hairs, so there would be nothing to sale for business people.

  95. U M says:

    88 Cristalle Karami Says:

    January 19th, 2008 at 10:58 AM PST
    I look at the red line and think, “you can’t be serious.”

    And then I realize that these graphs are not for us.

    The graphics are not for us they are for the future the large companies to believe their comapnies can ” get people to come take alook at their brand name in rl. They are lies nothing else. VR numbers and graphic for a vr world right? Don`t lose sence of this concept it will save you alot of bs in the future

  96. mac says:

    @94 “If there was no social life, we would not need clothes and hairs, so there would be nothing to sale for business people.” this statement and bits of the other stuff you wrote is not true your telling me that your social life is the be all and end all of business , business in sl does not just deal with skins and dress etc it adds to your whole experience it goes hand in hand , it`s the business end that creates houses parks and all the fun things you probably take for granted the scripts within the boats you sail on in the lights at the club you and your friends dance in, not all of this was made just for you to have a social life but also to make someone money to play with “business” the two go hand in hand .. and as for writing that you don`t need that in sl, sorry but use ya loaf i think you will maybe find that you do, and it by far should be tied in with the likes of griefers pfffft

  97. U M says:

    Is it possible to have real number for the “Second Life Key Metrics ”
    for the following…………

    1.) Countries By Active

    2.) Countries by Hours

    These numbers are so out of sycn its not funny. There is no possible truth to these stats. Are they rough figures? Or Assumptions? If that the case i say well you need to show your factors who they were gathered and what are your sybols. None are show, none are explain. What these google numbers show that anyone can generate any given stats but places numbers a graphic form.
    Instand of these RAH RAH people coming on this blog say ” GREAT NUMBER LL ” Well anyone with a 1 year high school can tell its all BS. Those that help put those numbers togther are those posting positve remarks about them. Nobody is that simple minded to believe it. Show the proof not graerated VR figure……….Put your money where your month is .Otherwise don`t waste people times

  98. Zee Linden says:

    Thanks for all of your comments. Yes, LindeX activity did seem to peak in March and it does look flat since then. March and April also happened to be our peak months for fraud which is, unfortunately, included in the charts.

    All the red line on the chart was meant to do was highlight what is a recent trend (since September) that matches the trends that we saw prior to the Land Sale in advance of the price increase and the Hype that really took off in November of 2006. Then, as I mentioned, I think we took a notch out of the economy when we shut down games of chance in July and started charging VAT in September. Hopefully, the growth since those events will continue.

    I noticed that a number of the posts reference a store that is selling all knock offs and is very high in the search listings. I would appreciate a note card in world with a landmarks that show where they are and what specifically they are selling that is a knock off.

  99. RightAsRain says:

    Zee: it really is great that LL publishes data. Not sure the 2007 growth claim is really bold to stir the excitement that people were hoping for in 2006.

    No question that users grew, although despite seeing users and hours more than double the net effect on spending was not the same. In fact, if you could strip out the 1L transactions my guess is that per person spending actually looks lower in 2007 vs 2006 December month. Take a look at my notes on our blog http://rezzable.com/blog/2008/uncategorized/2006-vs-2007-second-life-data/

    While we continue to think SL is a great platform, we continue to be baffled at LL marketing. Where did all the more than 8 million new registrations in 2007 go? That is a lot of work to only generate about 300,000 more active users. Why is this conversion rate so weak? Can’t blame VAT, sim-crossings etc, when people didn’t even get off orientation islands.

    SL is also more empty in 2007 than 2006 since new island increased faster than Active user growth. Given that there are close to 12,000 islands now–why does LL still run mainland? It is not for the money at this point and seems like a conflict of interests.

    If LL would really like to be transparent and give us SL health info, it would be great to see — 1) how many people registered but never got off Orientation islands 2) how many islands are being abandonned. 3) compare data from random sampling of avatars active in 2006 to 2007 to give a sort of like stores comparison.

  100. Lion Ewry says:

    Thank you for your responce Zee.

    Especially for your interest in the store that is evidently selling stolen things–Skins I think it is. This is kind of dishonest and unethical behavor and is killing the incentives of genuine creators.

    What most people here need to hear is that LL is listening and actually cares.

    Actually running a business here is a lot different than
    what LL perceives it to be I think. The concerns espressed here are VALID.

    Anyway your responce is a good start! Thanks for listening!

  101. RightAsRind (99) why so many people event don’t went off orientation islands, or remain only some hours in SL, is an interesting question.

    The helps and tutoriels in orientation islands are well made and clear, so here is not the problem.

    So, some hypothesis:

    -people don’t realize what virtual worlds are, and what they can do in. There is even, in my country, a despising of virtual worlds! (Solution: displaying soome texts “what you can do in SL” or examples of sims and activities)

    -Some people expect that SL is like WoW, and feel disapointed. We can think they have nothing to do in SL, or we can indicate them roleplay sims where they would be satisfied

    -people are disgusted at once by the kind of low grade chat we often see in orientation islands (solution: setting a much more personnal experience in these islands, so that they can do their own choice and have their own feeling. Helping people to look at heir maps and search, to look fo themes of interest for them).

    -many people are disoriented by the abstruse language used in numerous computer applications, or are supposed to guess what the menus mean, so they probably even don’t look at them.

    -One of the first concern of new members is to look for money. It should be made clear at once that there is no simple way to do this. Unless we start a serious business and work, all other means are just rip-off (camping, money games, escorts, etc). A good idea would be to allow for some true money-earning jobs in SL, so that people who don’t have money in RL can involve in.

    -Having more control on relevance of search results. For instance, if one search “reggae” he will found plenty of malls, shops, nightclubs, but hardly the groups really involved into such an activity. Especially the use of non alphabetic characters in order to appear in first in search should be forbidden.

    -allowing more freedom in names. I don’t know what family names are for, but they can be a real problem when we have to choose on the very limited list. Many people would even not enter SL for this.

    -grading sims and places, in order to have a clear guess on what they do. Many sims are just personnal places, access restricted, of just commercial. Sims could be noted depending on several criteria: -private dwelling -commercial -social -game -business -creation -science -mature etc.

  102. Pingback: Dogear Nation » Blog Archive » Dogear-Nation - Episode 36 - Mac World Expo - Not Really

  103. Lem Skall says:

    I want to make one point clear in case it was not clear enough already. IMO, “your world, your imagination” must mean also “your data”. Without that, “your world, your imagination” is only a hollow statement. And without “your world, your imagination”, SL would never have had the success it has. So, it’s not company tarnsparency if you release data that you control and that does not belong to you. Legally, it may be “your servers, your data”, but morally it’s a different matter.

  104. Syd Loon says:

    I’m curious to see what will happen tomorrow when the new policies for the economy take effect. I have been watching the economy for a while now, and have seen a steady growth over time, but there seems to be a steady growth of community, which leads to a steady growth of the economy. When money gets out of hand, it seems to hurt hte community which in turn hurts the economy. Seems like this is how it should work, so with that in mind im curious to see how the community will take these new policies and how the patterns of growth will be affected. I will be posting a blog here about my findings soon. http://www.remixreality.net/sydloon

  105. uh-oh says:

    @22 ” People think just because SL is a virtual world, that RL rules don’t apply. Hogwash. Every society, from the family unit on up, requires some kind of rules to function properly. If anything, SL would probably benefit from INCREASED morality rules, not lessened. I know a lot of folks will disagree, but just look at the main continent. What a garbage dump”
    RL rules do apply. that is why forced fantasy sims are not allowed.

    In the UK, it was announced on 30 August 2006 that possession of depictions of rape would become a criminal offence [1], including those involving consenting adults, and images which are faked.
    http://en.wikipedia.org/wiki/Rape_pornography

  106. Pingback: Second Life Guess « Rheta’s World

  107. Pingback: La rupture Internet » Les dernière statistiques de Second Life

  108. Pingback: TB Stats -20080124- Search, China, Innovation, SecondLife, Redtube « TechBays

Comments are closed.