The above image is from Ariane Barnes at Virtual Underground , Thanks for sharing Ariane.
It shows SL, WoW, There and the Island of Oahu all scaled so we all have some perspective.I have been watching the second life economy & the Lindens “economic data” for sometime, especially after looking for land about a year ago. I finally settling in on an open space sim in September, only to have the whole ball game change again in October.
I also have used the “Map” to explore SL and get some idea of its size and growth. I even published snapshots here and on flickr of the whole known grid.
In both cases I was only trying to get my hands around just what is the SL world and it's economy, were was the growth, what were the opportunities, and did the different business models make money inSL. I did not closely watched the banking and stock markets of SL, nor was I all that interested in gambling, but it was clear theses two “business" types were major players in SL second and third only to Sex.
I was around for the Banking/Gambling Bans, and the VAT scare.I was here when the Lindens flooded the mainland market with new sims, during “the boom”, when “land baron” bidders paid over $3000 US for a new mainland sim in auction, chopped it and “valued” it at 10-16 linden per meter.
Now I sense “the Bust”.
I only can sense it, the published figures are not clear and may be bogus. The Map has never been close to real-time, with islands only appearing or disappearing after sometimes 30 days. The figures for new Islands added have not been published for some time, but the Excel and XML publisher keeps pumping them out behind the scenes. Here is the last snapshot (1-10-2009)
Month Islands Owned (end of Month) Islands Added During Month
December 2008 22555 -2007
January 2009 - MTD 22098 -457My recollection
(correct me, please) is that the number of islands grew in the past 2 years from under 5,000 to 12,000 one year ago and then skyrocketed to around 28,000 with the devaluation of full islands sims and the introduction of the new Open Space island sims.
Now it appears we are down to 22,000 and falling at a uniform rate of minus 2000/month. I know that many OSs were sold for cheap to make full sims. I helped with that process myself but I also know may more that were just abandoned and shutdown. So yes these numbers are not a clear picture but they are all we have and they don't look good in any light.
There are bots that can survey the whole SL Grid, but the data is not published, at least it is not freely available. The Lindens say and I certainly believe them, that they have all the metrics, and real time dashboards, but no company publishes it’s “internal numbers” except those required by the SEC, and even then you will not find the number of customers, sales numbers by product line or the true costs of goods sold.
Are the Lindens building a platform, an economy, or are they just selling 21st century snake oil? We all sense a conflict of interest here since they are not just a platform but also the bank, police, biggest land barons & the media with control of all advertising, search and discovery. Not exactly a free and open market.
OK back to the numbers. Another interesting number to all is just how many people are really involved in the economy. Is it growing or not? The only number we all watch is the one we see each time we log in “concurrent users” which has grown from 12,000 two years ago to flatten out at around 50,000-70,000 now, but how many are just bots? How many are flat broke, like a freebie newbie? How many are alts?
Who knows?
Let's instead look at another number, which if it can be believed is one that I think is more useful. The number of people logged in 30 days and in those 30 days spent at least 1 linden. I doubt bots spend anything, and a stone broke newbie or player is no better then a bot to an economy. We cannot determine if these numbers include alts, but who cares, we can assume a ratio of 1 alt per person. That is fair, maybe an underestimate but who cares if it is my RL partner in my RL house using the same IP address or I have two identities one for fun, one for business, both identities spend lindens, both are virtual customers.
So let’s look at the last numbers published from 12-24-2008
Residents Logged-In During Last 30 Days: 975,916
and;
Last Month Total Customers Spending Money In-World
2008 December 433,021This appears, feels right, with 30,000 - 60,000 concurrency.
Look again. Less then half spent money. 543,000 customers are bots or not at all involved in the economy.
Damn that is a lot of avatars. I know when I was new and my linden balance was zero, I spent zero, but if that number was above zero I usually spent some of it, if not all of it in the next 30 days. Even if it was only 20 or 30 linden I made camping. (Yes I camped a few times ~LOL~)
After Costs Customers and businesses now lets look at the flow of money, the $L
Since we can assume the 433,021 had a Linden balance above zero on at least one occasion in December, what did they spend on average? Now that is hard to know, based on the data the Lindens give us. But we do have a number for the Customers making positive cash flow.
December 2008: 62929I won’t go into the rest of the numbers in detail, but here is what it looks like.
These 400,000 or so customers average about 20 (20linden+) transactions per month and assuming (read best guess) they spend on average one US dollar per transaction or about 280 linden. That produces a GDP of $8,000,000 per month, or $127/m per business (escort/model/hair designer/whatever).
Figuring a 50% takout/profit for those 63,000 positive customers that would be $4,000,000 or $63.50/month on average.
OOPs, that cost is low.. 20,000 full sims at say $300/month tier = $6,000,000/m for the lindens, or 75% of the of all labor and content sales in SL, reducing profits to $2,000,000 after tier.
Remember, someone is paying the piper.That reduces the average profit left to about $30/m. Not enough to pay a my internet bill. Yes; I know the long tail graph and that a few make real money in SL (over $2000/m). The Lindens say the number is about 600 accounts out of the total 433,000 participating customers and 63,000 “money makers”. There were reported to be 373 transactions in December over 500,000 linden (almost $2000 US in lindens). This totals at least $1,200,000/month. I would guess this is just the transfers from business alts accepting vendor receipts to other accounts. Remember that if they take out a few thousand dollars selling back lindens they must then pay the Lindens tier, ISP and server costs with these real dollars each month. Only the Lindens know just how good or bad a platform they have.
I scratch my head since I can’t think of 373 entities from land barons to content creators with that kind of business, My sense is at best a few hundred at best , from the likes of AlphaMale to Sinwave to Xcite. Again it would have been great if all that talk of independent research or Linden sourced metrics resulted in some trusted lists, some useful data
but.I understand that Linden Lab is in a difficult place running an economy (platform for business) while protecting their own straight jacketed business model and their IP and trade secrets.
I did hope that with all the fanfare surrounding a certain Cornell professor’s interest in virtual & micro economies and Second Life in particular, and the profusion of others, Academics, GIS gurus, marketing firms & bot designers that some data would finally be openly published. That has not occurred, so I like many can only scribble on napkins and rely on my gut feelings for what is happening.
Like the deliberate lack of a real-time map the Lindens will continue to prevent us from knowing real numbers so we can finally go beyond only sensing that Second Life is not a good place to do real business, is not a fair market, and is now withering on the vine.
