“Betamax? Is that still around?” I pondered today as I read news on The Guardian that Sony are going to stop creating Betamax cassettes in March 2016. The main reason that Betamax appears have continued long after many felt it had departed is due to the use of Micro MV cameras, which use Micro MV cassettes in Betamax format. However all good things come to an end and over 40 years after its release and almost thirty years since Betamax lost the video format wars, Betamax finally seems to be going beneath the technical waters.
Which brings us on to Second Life. Daniel Voyager recently reported; Second Life regions drop under the 25, 000 mark. Daniel’s blog post was based on a report by Tyche “Statto” Shepherd over at SLUniverse, where Tyche announced :
Well as I predicted , a milestone of sorts was passed this week as the Grid dipped below 25,000 regions for the first time since June 2008.
The scores on the doors on November 8th were :
- 24,985 Regions
- 17,888 private estates
- 7097 Linden owned
The net loss of private regions for this year stood at 712 on November 8th. However let’s compare this to some previous years to try and get a picture of what’s going on.
- 11/11/2012 – Total Private Regions 21,334. Year to date loss of 2,523 private regions (-10.58%)
- 10/11/2013 – Total Private Regions 19,462 . Year to date loss of 1,530 private regions (-7.29%)
- 09/11/2014 – Total Private Regions 18,735. Year to date loss of 538 private regions (-2.8%)
- 08/11/2015 – Total Private Regions 17,888. Year to date loss of 712 private regions (-3.8%)
Therefore we can see that this year we’re seeing an increase in the rate of net losses of private regions compared to last year, but the rate of losses is still a lot lower than in 2012 and 2013. Let’s play about with some more figures.
This year we’ve seen a net loss of 712 private regions, that’s 174 more than at a similar stage last year. That’s an increase of 32.34%. However this year’s net losses of private regions are 818 lower than in 2013, that’s a decrease of 53.46%. The comparison with 2012 comes in at this year’s net private regions losses being 1,811 lower than 2012, that’s a decrease of 71.78% compared to 2012.
What does this all tell us? Well we can play about with figures all day long (Maths is fun!) but the cold hard fact is that the Second Life grid continues to shrink.
We all know that the main barrier to private region ownership is the tier being too damn high. Customers know this, Linden Lab know this. Last month Derrick Schneider posted an interview with Ebbe Altberg on Geek Dad about Project Sansar :
So what’s in it for Linden Labs? Altberg says that Second Life’s main revenue stream for Linden was selling plots of land, which equated to a server. In certain situations, they’d make some amount of money from players selling goods, but even then it was five percent. Sansar is more about an app economy a la Apple, Google, and Facebook. If Second Life’s revenue is based on property tax, says Altberg, Sansar’s is based on sales tax. Reduce the barrier to entry, and take a cut from the touch point with the consumer. It’s a big shift for the company, though obviously one that’s worked well for others in the industry.
However Linden Lab are in a thorny situation because if they were to lower tier by the sort of amount that would stimulate private region growth, there’s no guarantee they would make up the shortfall in income.Think of it this way, if Linden Lab were to half tier prices, would private regions double? I doubt it, many people would save the money or spend it on something else and that’s before we get to the issue that more regions, means more server and support costs for Linden Lab.
However we do know, from painful experience, that lower land costs can stimulate region growth. Many of us still remember the homestead debacle. Which takes us back to Tyche Shepherd. In answer to a question regarding when regions peaked in Second Life, Tyche replied :
The highest I recorded was 31,988 regions in total back on 13th June 2010 , but the Private Estate max was 20 months before that on 26th October 2008 , just before the Homestead Debacle when they reached 26,605.
I don’t think any of us want to see another Homestead Debacle, so be careful what you wish for. Back in September 2011 Hamlet Au over at New World Notes was pointing out that around 80% of Linden Lab’s income from Second Life came from land tier payments. That’s why cutting tier prices has always been problematic. On the other hand, Linden Lab do need to look at stimulating income from other sources. They have been making good progress with their Premium Subscription offers. At one time Premium Subscriptions were an area that Linden Lab did not pay a lot of attention to, that has changed.
I don’t know what percentage of Linden Lab’s income comes from tier these days, I would hope it is lower than 80%. However whereas a lot of this post may sound doom and gloom, a recent article by Martin Bryant over at The Next Web painted a rather healthy picture, one that suggests Second Life is a long way from jumping into the boat with Sony and Betamax; Think Second Life died? It has a higher GDP than some countries :
Fun fact: with a reported GDP of $500 million, that’s higher than Tonga and a number of other small countries.
That is a fun fact and one that suggests Second Life has plenty of life in it. Inara Pey did a great job of covering the article from The Next Web. The article has a short sound recording of an interview with Ebbe Altberg, which is around ten minutes long but it’s well worth listening to because it contains a lot of positive points regarding Second Life. I’ll embed that at the end of this post, which is going to be very soon!
For more statistical goodness from Tyche Shepherd visit http://gridsurvey.com/
I call the 500 million GDP bogus. The Lindex transactions are 118 Million per year. Tier income for Linden Lab is 43 million per year.
Where is that 500 million GDP?
Show it to me.
When one guy puts 4 Dollars in an illegal skill gaming machine and the other guys pays out 5 Dollar on that illegal skill gaming machine they just generated 9 Dollars worth of GDP for Second Life
That is the GDP ?
Is there anyone that can explain the 500 million GDP to me?
User to user transactions, yup that seems to be the measure. LL aren’t as open as they once were on their stats, but here’s a blog post from the end of 2009 when they said the size of the economy was US$567 million :
https://community.secondlife.com/t5/Features/2009-End-of-Year-Second-Life-Economy-Wrap-up-including-Q4/ba-p/653078
The issue isn’t such the size of the GDP, it’s how it compares historically and there are far more indicators that need to be taken into account when really looking at the health of the economy.
I think Ebbe’s doing a fine job at the moment. Second Life is an ageing platform, WoW , another ageing product with an out of date income model, is shedding users. They are both in decline but both have enough users and interest to keep them going for quite some time yet.
The only thing we can conclude is the effort that CEO Altberg has on Second Life which is highly negative.
CEO Altberg is a burden to Linden Lab and its finances
They need to 1/4 the price of regions. Several Open Sim grids are every bit as solid and dependable as SL. But they are a fraction of the price. The only benefit SL has going for it is the wealth of content creators. If a region in SL was of a competitive price I would definitely own an SL region. I’d say of the well over two dozen or more people I know at least a few of them would rent, some for the first time if rates were competitive.
As LL refuses to be fair in their Tier system they will face a tipping point. At some point an Open Sim currency will be largely embraced. Kitely Market or some other market will rise and content providers will no long feel as without options. In the long run these factors will even the playing field as LL will fail to be able to demand their outrageous tier demands.
Betamax? A false analogy. That analogy assumes that SL is superior as a format over Open Sim grids. It isn’t.
I like a lot of the stuff I see on OpenSim. I’m a big fan of the work being done with NPC’s and Hypergrid Stories are a brilliant example of users working together to make something innovative.
However I do think that in terms of performance and stability, Second Life is the superior format. That doesn’t mean OpenSIm is vastly inferior, far from it.
My experience contradicts you view point. I had large events on an Open Sim, a large number in attendance, NPC dancing partners, megaprim art, and particles without issues. I suggest that you are less than impartial in your judgment or perhaps have not spent that much time on Open sim grids.
That is because in opensim they are not overselling their resources like Linden Lab does. To save costs Linden Lab stacks 16 full sims on the same server these days. When you go to a party and there are 10 people you start to lag.
In opensim you can have a lot more people on a server because you control the server. Many people in opensim do not even use servers, they just run the sim from their PC so you get less performance which is normal, still it doesn’t cost them a cent to have a sim. In Second Life you need to pay 300 US$ a month for a sim and they stack 16 of them on a single machine.
Instead of lowering tier costs these Lindens have put more sims per server to save on costs over the years. Performance in opensim is just as good if not better compared to Second Life these days. That is why opensim gets more regions and Linden Labs gets less of them.
I have not spent that much time on OpenSim grids, I have spent a lot of time in Second Life. I can only base my opinion on my experiences.
I’m not in any way shape or form suggesting OpenSim is a poor product, but even on my visits to OpenSim the OpenSim regulars tell me it has bugs and flaws and so does Second Life.
Indeed, i must add that being using lately OSgrid Sandbox plaza 2 and all the assets take much less tie to be imported, form bvh files, to sounds and mesh.
I keep telling that the only thing that makes Sl different is mainland and the private regions connected to it, for all the rest open sim is in fact now a much better alternative.