Growth of Second Life Community and Economy
Tuesday, December 12th, 2006 at 11:13 AM by: Zee LindenToday I posted five new charts showing the growth of the community and economy of Second Life. I chose these statistics to show because they are most relevant to me as I analyze the in world economy and forecast the revenue of Linden Lab. Below is a short explanation of each.
Premium Residents. There are two types of accounts that a Resident in Second Life might have: Basic and Premium. Basic accounts are free. Premium Residents pay a recurring fee to buy land directly from Linden Lab, and receive a weekly allowance of Linden Dollars called a “stipend.”. The orange graph shows that the number of Premium Residents has grown from 5,000 at the start of 2005 to over 36,000 at the end of November 2006. The blue line shows that the number of Premium Residents has grown 10 to 30% each month since 2005. Premium Residents, aren’t the only ones who are contributing to the economy, however. Since its inception more than 90,000 unique Residents have bought currency on the exchange. Basic Residents account for significant economic activity.
Regions of Land Owned by Residents. The Second Life world is made up of over 3,500 regions of land. A region is 65,536 square meters of land simulated by approximately 1 server CPU, making the combined world of Second Life nearly 4.5 times the size of the island of Manhattan Island. Each region can be divided among many Residents or owned entirely by one Resident. The land can be part of the “mainland” which is sold by Linden Lab, or it can be part of an independent island owned by Residents who can set specific rules and control the land any way they choose. Frequently, Residents form groups of similar interests – from social groups who share a love of the Wild West to art collectives to business consortiums – where they can share land and easily communicate with each other.
Residents who own land pay monthly maintenance fees that range from the 512 square meters that is included with a Premium account to $295 for a full region. In 2006, I expect that 70% of Linden Lab’s revenue will come from land sales and maintenance fees.
User Hours. The number of cumulative hours Residents have spent in Second Life each month has also grown dramatically since the beginning of 2005. In November of 2006, Residents spent more than 6.4 million hours in-word – that’s more than 10 times the number of user hours in January 2005. Similarly, the monthly peak number of Residents in-world at the same time, concurrent users as seen on the Second Life home page, has grown dramatically, reaching over 18,000 in the past couple of weeks. It’s estimated that about 30% of user hours are spent building and scripting content in-world, and that women make up a little less than half of the total user hours each month. Currently, about half of the new Resident sign ups are from outside the US and the total hours used by non-US Residents continues to grow the fastest.
LindeX Volume and Cash Payouts. The LindeX is a virtual user-to-user currency market in which Residents can buy and sell Linden Dollars (L$) – the virtual currency of Second Life. Residents use L$ to buy and sell virtual or real goods and services in Second Life. We first launched the LindeX in October of 2005. Since then more than $15 million dollars worth of Lindens has been bought and sold on the exchange – with $2.6 million traded in November alone. Many Residents operate businesses in Second Life where they sell virtual or real world goods or services in exchange for L$. They can then sell their L$ on the exchange and use their resulting US dollar balances to pay the maintenance fees on their land in Second Life, or they can get real cash. Since October of 2005 our Residents have cashed out almost $8 million with about $1.1 million of that in November. The larger shaded area on this graph shows the number of US dollars traded for L$ on the LindeX exchange. The smaller shaded area shows the number of US dollars Linden Lab has paid Residents who have sold Linden dollars on the exchange. Many Residents make enough money that Second Life is their sole income.
Economic Activity. This chart is for the economists in the community. The dark blue chart shows the total supply of Linden dollars in-world at the end of each month since January 2006. The light blue chart shows the total Linden dollar volume exchanged between Residents. The orange line is simply the light blue chart divided by the dark blue chart – the total in-world Linden dollar transactions divided by the supply of Linden dollars. In a real economy this is called the velocity of money. Basically, this means that Linden dollars are cycling through the economy about 2.2 times each month. In November of 2006, there were about a trillion Linden dollars in circulation and about 2.4 trillion L$ passed between Residents, implying an economic velocity of 2.4. The economic velocity has been surprisingly steady as the economy has grown. The average monthly economic velocity in 2006 was about 2.2x with a standard deviation of 0.16x and a median of 2.3x. The stability of this monthly number is interesting given that the daily exchange of Linden dollars has been inflated at times by individual users performing tests on some of their scripts.
But economic velocity is one of the many underlying metrics of Second Life that show a high level of consistency over time. It’s that consistency that makes forecasting Second Life growth surprisingly accurate and exciting to contemplate.
I hope this additional transparency into the underlying statistics of Second Life is helpful to you. I’m sure there are many statistics that people would love to see and we’ll be releasing more information over time. I think the community would agree with everyone at Linden Lab that being involved with the growth of Second Life is a lot of fun!
December 12th, 2006 at 11:29 AM
[...] Zee Linden blogged about the release of some new graphs covering the growth of the Second Life community and economy. You will note that the growth trends are pretty consistent across all the graphs. A few interesting things quoted directly from his post: [...]
December 12th, 2006 at 11:31 AM
Great Graphs…But why on the Economic Stats page http://secondlife.com/whatis/economy_stats.php the In World Business Owners stats are cut off after $2000 USD… There are stats for $2000-$5000 and $5000+. Someone fix it!
December 12th, 2006 at 11:33 AM
Interested to read your comments about premium members and land ownership, I am a premium member and cannot find any first land to buy since you seem to have a policy of not making it available, rest assured that once my 3 months is up that I have already paid for, i will be downgrading to a basic account.
December 12th, 2006 at 11:33 AM
Wow. Nothing like a long post with charts and graphs to draw attention away from stability issues.
December 12th, 2006 at 11:38 AM
Thank you for posting this LL. These graphs finally prove that the economy actually benefits from all of the basic accounts. This should at least give all of the “Premium Elitists” something to think about. However, this exponential growth is disturbing, if it is growing at this rate, will you guys be able to cope? There are already enough problems already, if this keep up for a year, you may never catch up.
December 12th, 2006 at 11:41 AM
This may not seem like it has anything to do with the growth of the SL economy, but one does wonder what will happen to the SL economy if this little “hiccup” becomes a wide spread disease.
Lynn Kukulcan
November 28, 2006, I sold some L$.
My US$ Balance changed to reflect the sale.
I decided to process the money to PayPal.
My US$ Balance again changed to reflect this.
The money never made it to PayPal.
I get a billing statement.
I notice for the previous times I do this, I see a “Sold L$” comment on my billing statement.
Behind that, there are two “Transfer to PayPal” comments.
On November 28, 2006, there is the “Sold L$” line.
Following that, there are ZERO “Transfer to PayPal” comments.
Looking at that billing statement, one would assume I never transferred the money to PayPal.
Looking at my account page on Second Life, I notice I have a US$ balance of US$0.00.
Looking at my bank statement, I notice that every penny LL usually takes for purchasing L$ and for land tier is accounted for. To wit: None of this missing US$ Balance on LL was used to pay for any of my usual LL Bills.
The L$ was sold November 28. The proceeds were not processed out of my account. they were not applied to LL related expenses. I should have a US$ Balance, still, right?
My US$ Balance is US$0.00.
Please explain to me what happened, and, for gods’ sakes, fix it!
Lynn Kukulcan
December 12th, 2006 at 11:42 AM
@Shouri
Like so many others, you are missing the point of the argument. The problem is not with free accounts. It is with UNVERIFIED free accounts, which are held by those who can’t or won’t put their payment info on file. I am not a premium account holder, but I am verified, and I put money into the economy through non-Linden land purchases.
So please know the facts before you start coming down on all the “Premium Elitists”.
December 12th, 2006 at 11:43 AM
About 2% of the population is premium? I’d sure like to see a chart with the number of active (logged in within 30 days or so) basic accounts or maybe just a graph of the premium:basic ratio. Some way of showing who spends money (premium vs basic vs unverified basic) would probably shut down (or maybe enflame) some ongoing discussions that we see here in the blog, too..
Interesting data, Zee. Thanks for posting it.
December 12th, 2006 at 11:46 AM
Draw attention away from the stability issues? This doesn’t do that. Not every post is about them, nor is every Linden in charge of fixing them at all times. Running a company is a balancing act.
Congrats on the growth. Not surprising; this place rocks. Nice to see numbers that show us free accounts are contributing to the economy.
December 12th, 2006 at 11:47 AM
I wonder if LL would also do an econmic impact of the free accounts on the economy.All this dancing and camping must be good for economy somehow.
December 12th, 2006 at 11:49 AM
Boss Melnitz Says:
December 12th, 2006 at 11:33 AM PST
Wow. Nothing like a long post with charts and graphs to draw attention away from stability issues.
If you want some help I can explain them to you in world.
December 12th, 2006 at 11:52 AM
Thanks for sharing this information it’s pretty interesting to read over.
December 12th, 2006 at 11:56 AM
Stay on topic. It is easy and even addictive to snipe complaints from a distance into unrelated topics. It likely makes you feel more important, less helpless, less insignificant to do so. The stability issues are frustrating, but once they are resolved I doubt you’ll be any happier. You’ll find something else to whine about because you derive pleasure from it.
I would like to actually find useful, contributing replies when I read these topics. Apparently, DESPITE the stability issues, the trouble with the database, the missing inventory items, the failed teleports, Lag issues, grid attacks and the search engine being down…we’ve still grown significantly. I don’t need the charts to tell me that, I can see still a growing number of new accounts on SL, and where I’m at business is growing despite the recent troubles.
It certainly hasn’t driven Boss Melnitz away, Second life seems to provide something he needs as well.
I think I’ve read several replies on the blog complaining that the information given wasn’t meaningful enough to tell what was going on. Questions were asked, and it seems like this is a pretty good answer. As usual, it isn’t enough for some people, they wait in ambush waiting to pounce on anything said, ready to tear it to peices and feel smugly superior. “oh those stupid Lindens”
The issues are being resolved, the grid is becoming more stable, and despite a few bugs it has started to perform better than it has in the past. The Lost inventory items are not being ignored, the teleport troubles are not being ignored, the time the search was down Linden Labs allowed everyone a free renewal for a week to help make up for the week lost (you can’t ever REALLY make up for lost time). How about a free month to premium account holders and a giveaway to everyone who signed up before Dec 1st of oh…5k Linden? It wouldn’t be enough, I’m sure. People would start whining about “the time SL was so messed up they had to give away free month of service to make it right”.
Face it, you don’t want things to work right. You want exactly what you have.
December 12th, 2006 at 11:56 AM
The problem isn’t really “basic accounts” versus “premium elitists”.
The problem people see is really “unverified accounts” versus “verified accounts” whichcan be either free or paid.
I would be interested in seeing how many verified accounts there are, and how many unverified.
coco
December 12th, 2006 at 12:03 PM
Thank you so much for posting these interesting stats. Second Life has a reputation for being very communicative with SL residents, and it’s nice to see that booming growth isn’t changing that.
December 12th, 2006 at 12:03 PM
If only 36,000 of the almost 2 million members are premium and pay $6-$10 a month for their memberships, think of how much revinue it would be for LL if the remaining BASIC members had to pay just $10 a year for all the database space they take up with their inventories as well…that’s close to $1,500,000 a year in just membership fees…think of how many customer service reps that could pay for a year?
Just $10 a year for a basic membership…I don’t think that is asking much to improve customer service!
December 12th, 2006 at 12:04 PM
oops…that’s 15,000,000 a year (forgot to multiply by 10)
December 12th, 2006 at 12:08 PM
Same old story. “Growth”. Its the American thing: if enough is good too much is better. I’m beginning to feel very disapointed with the whole business. The Lindens don’t really seem to care about quality. They are harder and harder to reach. The system is quite obviously in trouble…I log on now expecting trouble. I guess its the way everything goes these days. Those of us who started early in SL are, I’m begining to think, just in the way now. Now, its all about statistics and profits. Pretty sad that this virtual world does not seem able to live up to its initial promise. “Not a game”? Excuse me, its the same old game: money, profits, numbers.
December 12th, 2006 at 12:09 PM
Love the new economic stats
December 12th, 2006 at 12:09 PM
[...] Artigo a ler: Growth of Second Life Community and Economy [...]
December 12th, 2006 at 12:11 PM
I’ve slapped together a graph that displays the growth of simulators at http://stats.slbuzz.com/ (middle of the page).
Seems to be roughly in line with the Square Kilometers of Second Life Land graph.
December 12th, 2006 at 12:15 PM
I believe these charts show something that would be practically impossible to obtain within the domain of US Dollars. These charts show accountability of every linden. Businesses spends tons of money every year to track their money. Linden Lab has shown a way to cut a major expense to account for such currency. I believe these charts show how businesses will soon move away from the cold hard U.S. Dollar to electronic funds.
December 12th, 2006 at 12:15 PM
In chart one it shows the rate of growth be exponential. With new accounts (basic and Premium coming in this rate your company will be hard press to keep adding resources and sustain service level. From the climb rate it in the chart I’m estimating your will quadruple your population within 6 months. Have you consider having a small new account fee for Second Life to low the climb rate to help LL incorporate resources to maintain a good level of service to the users.
December 12th, 2006 at 12:17 PM
Boss: Get a grip. Yeah there are stability issues. That doesn’t mean stability is all anyone can talk about, and it certainly doesn’t give a person license to be so confrontationally disrespectful to a Linden who might not even be in a position to do something about it. What do you want - that the Lindens should all go into hiding whenever there’s a hot issue to work through?
These stats are appreciated and helpful for people trying to create businesses and community projects. I hope they continue. Thanks, Zee!
December 12th, 2006 at 12:21 PM
I would also be interested to see the verified v unverified figures, including how many of the unverified actually log in more than once.
A player base of 2 million isn’t impressive if less than one percent are actually active players.
Broccoli
December 12th, 2006 at 12:23 PM
That would all be good and nice, if the grid was currently useable
Of course, news about growth and success leave a much better impression than the current grid status, which is best described as “halfway up and crouching”. Sorry for my sarcasm, but with teleports not working, inventory issues, sim crashes, animation bugs, blurry textures and broken HUD attachments, minors on the adult grid, a useless “places” search function and lots of other asset server / database issues, I can’t really feel happy about this growth.
December 12th, 2006 at 12:27 PM
There are no premium elitests,I have nothing against verified free accounts.Griefers use unverified accounts to create alts so they can launch numerous attacks,The Lindens cannot track unverified alt attacks as easy as they can a person who uses a cc or verified account.I hope everyone gets this now.
December 12th, 2006 at 12:29 PM
Premium Account Holders: The Few, The Proud.
December 12th, 2006 at 12:33 PM
So basically, we are getting more stuff, spending more money, getting more addicted. Can I cancel RL and stay here? I can’t tell which crashes more
December 12th, 2006 at 12:33 PM
Zee,
thanks for starting to give all of us more useful stats!
Keep adding more!
December 12th, 2006 at 12:34 PM
I agree with Broccoli Curry. Let’s see the figures of verified versus unverified.
December 12th, 2006 at 12:34 PM
what a welcome change! Zee, as far as you can tell that the growth of Second Life meeting or exceeding any expectations you had in the beginning????
December 12th, 2006 at 12:35 PM
Statistics are great, but what caught my eye was the line “A region is 65,536 square meters of land simulated by approximately 1 server CPU,” Don’t mean shared on 1 server CPU? Or is the below info no longer correct?
Class 3 server = 2 Sims.
Class 4 server = 4 Sims.
December 12th, 2006 at 12:43 PM
this is nice news, i am not one to really care about selling Lindens and recently i hvaent had the need to buy any, but on one of my daily wander i noticed that the lindex was up and when enquiring how much linden i had to sell and how much real money it would get me i was pleasently surprised and chuffed that finally after a year of constantly wrking on this game and making clothes etc i can now just fy all the time i spend on it to my husband!.
about the issue of accounts, i have been a verfied basic account and i have been a premium account, and downgraded because the amount of prims i get on the amount of land i could tier fee afford was nothing compared to the amount of prims i can get on a rented peice of land. so i am one of the middle groups. okay so i have never been an non-verified basic member and i ahve had many an argument about age verfifcation and have reported many a youngster to the lindens. I am totally nebie friendly and after talking to Genuine over 18 non-verified members, they are great and are willing to work for money. One girl i was giving 30% of the purchase price of each outfit she helped people buy from my store (a sort of commission thing) then gave her a basic tutorial on making clothes and now she has used the linden she earned from me to upload her new textures for her own clothes. althought i am newbie friendly i cant stand people who just say “give me money and clothes” so in an effort to help more have put out a good selection of freebies with tutorials with a cheap yard sale next door. The onlt thing is, i cant be offering every newbie that comes my way commission work and i think that linden labs should throw them a bone and possibly not give them a full 50 Linden stippend but what 20 linden. Mind you we could argue that it was the stippend that got the economy into this trouble anyway.
I also noticed the nice selection fo clothes that the library has to offer lately and that has to be commended. linden clothes were once the most recognisabley horrible (no offence to who ever made them) and now i love those sexy jeans you have in there, they kick ass.
Anyway i think i may hvae waffled on a bit too long now, so congrats on your economy growth, i actually noticed it without promting which must be good, but as someone else said can you fix the stability and mainly the notices.
thanks kiddas
Kat
December 12th, 2006 at 12:43 PM
I’d like to see a couple of graph containing the distributions of time between logins and login time.
December 12th, 2006 at 12:44 PM
god my spelling is bad
December 12th, 2006 at 12:48 PM
Thats funny…..All the graphs are sky rocketing…just going up and up… yet the quality of service and reliability/stability is going down…waaay down. In the last month I can tell you how many things that have been lost from failed to rez’s or items returned to me and not showing up in my inventory….crashing sims, or regions…super lag…login instability…the list goes on and on. Just would be nice to have something reliable for a change, except for the fact that more and more people are playing…I would just like to be able to put something down and not have it dissapear or even log in and be able to see my clothes on a steady basis. With all those graphs showing such positive aspects, I dont think that what I’m saying, is too much to ask for, or out of line….
December 12th, 2006 at 12:58 PM
Dzonatas Sol Says:
December 12th, 2006 at 12:15 PM PST
I believe these charts show something that would be practically impossible to obtain within the domain of US Dollars. These charts show accountability of every linden. Businesses spends tons of money every year to track their money. Linden Lab has shown a way to cut a major expense to account for such currency. I believe these charts show how businesses will soon move away from the cold hard U.S. Dollar to electronic funds.
—————————————————————————————————————-
Please reread my post.
They currently do not and can not account for every dollar. I know that at least in my case, I sold L$, and attempted to transfer the money to PayPal.
According to Linden Labs, the money was never transferred. Yet, my US$ balance remains US$0.00, the post transfer amount.
Did the money transfer, or didn’t it? Did I sell L$, or didn’t I? Did I even have L$ to sell in the first place?
If I can’t expect to get real money selling my content in Second Life, why in should I sell it at all?
Why should anyone expect to run a business in Second Life if there is no guarantee the money they earn in Second Life is in fact transferrable to First Life?
Lynn Kukulcan
December 12th, 2006 at 12:59 PM
Say, did camping chairs start getting popular in 2005.. ?
December 12th, 2006 at 1:06 PM
As far as I am aware, there are THREE types of accounts in Second Life.
Premium : Pays a monthly fee for land. (’We know where you live’
Basic: Free - WITH PAYMENT INFO ON FILE - ie: accountable for actions and age
and:
Basic - NON VERIFIED : Eg: no details whatsoever. Possibly/likely to be a false email. No accountability whatsoever. No traces. Nada.
Ten to the dozen.
December 12th, 2006 at 1:10 PM
[...] Does economic forecasting get you aroused? Nah, me either. That said, Linden’s release of some in-world economic data actually makes interesting reading. [...]
December 12th, 2006 at 1:11 PM
Has anyone of you that are gripping about how stablity and growth are problems. It is because of the growth that there is stabiliity problems. HELLO DUH. Every day they have people starting new “toons” which puts more stress on the servers. Quit your gripping. Everything that has been said goes hand in hand. With growth there will be problems!!!!! Sit back and relax and enjoy why you came here in the first place.
December 12th, 2006 at 1:13 PM
As a paid up resident of this world policed by Lindens, I would also like to see the statistics relating to Abuse reports, comparing reports with Premium, Basic (verified) and Basic (’liggers’/non-verifieds) - we dont need to name names.
In fact I, along with others INSIST upon it. I believe we have that right.
Thank you,
Koz
December 12th, 2006 at 1:32 PM
Great charts, I’d previously assumed that cash pay-outs were significantly lower (more like april-06’s ratio to volume), it’s good to see more folks are able to get re-imbursed for their efforts in SecondLife. While I’m sure a lot of those cash-outs are going to money traders and land barons, I have hope that content creators have a fair slice of the pie.
I have a question though… When LL sells L$ directly, does the money to LL also count towards those payout totals?
And lastly a pro-unverified comment: Without unverifieds, the growth in premium accounts would be significantly less, as would the growth of new verified players that spend money. It’s a marketing tactic. IF growth is out of control, LL should cut back on the press releases for a bit, not ban unverifieds.
If LL slams the door on unverifieds, cutting off much of the new resident pipeline, there could very well be disasterous economic consequences. Enthusiastic new residents are the ones that are BUYING L$… reduce those numbers and sales will come down, cash payouts will come down too.
I’d rather put up with growth problems and the occasional griefer than try to run my business from inside some snobish gated community.
December 12th, 2006 at 1:35 PM
Yes, please. To my knowledge, unverified accounts cannot add anything to the economy in terms of real dollars, so some of these charts are comparing apples to oranges.
Those of us who do pay are subsidizing those who do not pay. Therefore, while I am only subsidizing some verified accounts, I am subsidizing ALL unverified accounts, who in turn compete for system resources and are more likely to launch attacks against my fellow citizens to boot.
Can these charts be re-published with data pertaining only to those who are actually able to contribute real money to the community, whether they have contributed or not?
December 12th, 2006 at 1:41 PM
Blogs about the net have been taking apart the linden stats for a while now, they have very detailed graphs to show that the numbers are not possible. I think what would be of more interest is, an external audit of the numbers.
As to the economy graphs and numbers are interesting but do not matter much when customers can not find a location and then are told they are banned. For an economy to work the system must be stable and there is faith in the numbers. The US currency just lost over 10% of it’s value beccause of trust issues.
As a interesting side note. For the europeans the increase in charges for Sims will be soon wiped out by the US$’s losses
December 12th, 2006 at 1:42 PM
Zee say:
“It’s that consistency that makes forecasting Second Life growth surprisingly accurate and exciting to contemplate. ”
If SL’s growth is so surprisingly accurate to forecast, why hasn’t LL used this information to some end other then touting their own horn about financial growth?
Where’s the graph pertaining to level of customer satisfaction? Wouldn’t this predictable growth have given you a clue months ago that hiring some more customer service reps might have been a good idea?
Where’s the chart for stability and usability of the grid at large? Wouldn’t accurate forecasting have given you plenty of time to test and re-test and re-test again what consequences having this media hyped growth would mean to the quality of your product/platform?
Rapid growth does not always mean improvement of service or continued success. Numbers were never what impressed me about SL. I don’t care how many paid, unpaid, verified, not-verified accounts exsist or how much money is being flung around the grid… what difference will all that matter when SL collapses under its own bloated wieght.
December 12th, 2006 at 1:46 PM
LL Please listen to this post.
Strangley, I seem to agree with not having free accounts. Though, when I joined, it was because it was free to join. I am the kind of person that would not put up $1 let alone $10 to try something I have no idea about. It was free, so I tried it. I now have a permium account, a $25/m land tier and buy $L in world. I also have a decent place, a handful of really good friends, many aquatences(check spelling on that) and some decent stuff that allow me to have a very good time inworld. I have also learned about building and am starting to script. This is an oportunity for me to make some if not all or more of the money I pay LL. - You will see the point i am getting to later.
If new residents were to say, have a month free but then new residents are forced to make the decision of either pay $10 for a verified account (per year?), or pay for a premium account, or leave SL altogether. Now this would not stop griefing and I will talk about this now. If there was a month free membership, ten griefing would not stop. I’m not sure if it would grow or get smaller, but I am considering that there would be no change. If residents left SL after their initial month, then frankly so what… The decent residents are residents that have chosen to make an effort of some kind. If the new residents left after a month, I really dont think it would affect the amount of friends people have or the way that businesses in SL do. I will get onto LL very shortly, yes there is something in it for you too!
If the residents that wanted to stay paid for a verified account, and I imagine more than half free memberships at the moment, then that would be a big increase in takings for LL. Some residents would become premium members also, though I feel that the residents that are going to become premium members would do so regardless of the months ‘trial’ for want of a better expression. More income for LL would mean that if they actually start to turn a profit, then I have no doubt that LL would start to spend more on SL. They both go hand in hand in any business and only a fool would not put more into something to get more out.
If this was the case, then I predict that the level of service would get better (though personally I have great service from LL, but also I have wanted to shout at them for other things too). I feel that the amount of residents would start to level out. There has been a massive influx of new residents, LL you can use this to your advantage and give us, the residents something back too. I realise that if this happened, that us residents would not feel the benifit for some time, so guys, gals, residents, chill, get a martini and go soak in the nice hot tub you have. Chill out with friends and slow down a little with putting every little fault on LL.
With the influx of new free accounts, this is LL’s chance to stableise thing both for SL and LL. But this does mean a massive compromise on an SL global scale. If this happens, then there will be free members up in arms. But for them to stay, its $10, its not a lot, not a lot at all. A couple of RL beers? A bottle of RL wine? A couple of RL DVD rentals? Anyone that can afford a broadband internet connaction can afford $10. II know a lot of permium members don’t argee with free accounts, I’m afraid I’m one of those people and I did start with a free account, and had it not been for that I would have never joined.
We both (LL and the residents) can win (eventually) if something like this happens.
December 12th, 2006 at 1:51 PM
G’day Zee
Well written and great to see Linden Lab being transparent in this area.
After all, what people don’t realise is Linden Lab don’t have to disclose this information so openly here - they choose to.
Cheers
Alex Warrior
aka Janine Au
PS. My spelling is correct based on the English dictionary. *wink*
December 12th, 2006 at 1:51 PM
[...] An ever increasing number of requests are coming in from research projects with PhD student Aleks Krotoski the latest. Each will help the mainstream public better understand SL and begin to appreciate what makes it so unique. Looking at the latest graphs from Linden Lab and reading their accompanying post makes all of the above a very good thing as SL rapidly approaches 2 million accounts. [...]
December 12th, 2006 at 1:52 PM
Man I really went off topic there. I apologise for that but it was something I really needed to get off my chest.
December 12th, 2006 at 1:55 PM
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Jamie Davod:
As a interesting side note. For the europeans the increase in charges for Sims will be soon wiped out by the US$’s losses
—————————————————————————————————————-
What do you mean with “soon” Jamie? The US$ lost almot 30% of its value compared to the danish kroner i pay in :). Not that im complaining, dont mind saving 30% on my books, DVDs and online games
December 12th, 2006 at 1:56 PM
I have read in the news that two companies (iG and Telefonica) are going to create a SL clone, to be open in Brazil and to steal the Original SL players and some other latin players, do LL have any concern about that?
December 12th, 2006 at 2:02 PM
Nice graphs, but they’re frightening. Can LL code fast enough to scale with the load? If the load doubles every 6 months.. 5 months.. 3.. every month? etc?
December 12th, 2006 at 2:04 PM
@jrrdraco oe:
SL clone: years of work, investment, time, risk. Are you sure about it? Maybe they’re just making a lame clone, a thing similar to There.com?
December 12th, 2006 at 2:11 PM
A forum comment quote:
‘Linden Labs long ago decided it’s far easier to seek new revenue streams with those who are already paying rather than try to convince those unwilling to pay to chip in to help pay for what they’re using.
Supply Linden sold about $280,000 US worth of new L$ last month alone, roughly the same amount of money as all the 36,000 premiums bring in (not counting tier obviously ).’
December 12th, 2006 at 2:15 PM
Zeelinden, Many thanks for these statistics. I have downloaded them and am sure they will generate many follow-ups. Something which comes up immediately: it would be helpful to understand the relationship (if any) between:
a) The US$2.6m shown in these figures as Lindex volume for November 2006, which you explain above as “the number of US dollars traded for L$ on the LindeX exchange”;
b) The US$1.1m shown in these figures as the cash payout for November 2006, which you explain above as “the number of US dollars Linden Lab has paid Residents who have sold Linden dollars on the exchange”; and
c) The L$77,327,855 (that is approx US$0.286m) shown at http://secondlife.com/whatis/economy_stats.php in the table of “Sources and Sinks” for November 2006 as “Supply Linden sales”, which is defined there as “Number of Linden Dollars sold by Linden Lab on the Lindex”.
REPLY FROM ZEE LINDEN
The US$2.6m in (a) is the total US$ paid for/received for Linden Dollars during the month of November on the LindeX. Those that receive the $2.6m have several choices, they can use it to pay our USD fees, they can keep it on their account, they can buy more Lindens (as traders might do) or they can cash it out. The US$1.1m in (b) is the amount of money that sellers on the exchange decided to cash out - in other words they had a credit balance on their account, the requested a cash out and we sent them the money via paypal or check.
The $286,000 USD in C is included in the total LindeX volume in A. In other words, Linden Lab “sourced” our “produced” L$77m to sell on the exchange to buyers who paid $286,000 for them.
December 12th, 2006 at 2:26 PM
Jopsy Pendragon wrote:
I’d rather put up with growth problems and the occasional griefer than try to run my business from inside some snobish gated community. - i totally agree with you, lucky enought i rent an island where we have nearly equal banning rights etc so i just ban griefers, mind you i only hvae about 6people on my banned list. plus the newbies are okay if you just help them out.
Alex Warrior’s PS. - i know darling i cant beleive i used to type for a lawyers for a living, i swear my spelling is getting worse everyday, My spelling is correct to the Dictionary of Kat Sullivan lol.
Zonax Delorean - yeah there.com was lame i was there paid for the account and havent used it since, it was just so hard ot make any sort of living there, and the newbies in there.com are almost always victimised, it goes back to Jopsy Pendragon’s comment , we have to try do our best not to let the snobbish society that is in there.com come to second life, we can all see wher there.com is heading.
December 12th, 2006 at 2:32 PM
Second Life Population Density
Official Linden Blog reports that current Second Life land area is approximately 229376000 square meters (about 88.56 square miles or 229.38 square kilometers). Their front page currently reports 1,950,245 registered residents.
That gives us populat…
December 12th, 2006 at 2:34 PM
It is interesting to calculated population density and compare to other countries. I did that:
http://lev-kamenev.blogspot.com/2006/12/second-life-population-density.html
December 12th, 2006 at 2:58 PM
Reminder, for those of us who are honest, only our FIRST Basic account is free. The rest cost $9.95 each to create.
Some interesting observations, based on the new stats:
1,950,245 “Users” ever created, but only:
527,556 unique logins in the last 30 days
789 440 unique logins in the last 60 days
36,000 Premium members
Therefore, our current Premium members account for:
1.85% of all accounts created to date
6.82% of all accounts that logged in over the past 30 days
4.56% of all accounts that logged in over the past 60 days
If we assume that 100% of the Premium accounts did log in over the last 30 days,
Non-Premium accounts (both verified and unverified) make up:
98.15% of all accounts created to date
93.18% of all accounts that logged in over the past 30 days
95.44% of all accounts that logged in over the past 60 days
121,332 accounts spent at least L$1 in November.
If we assume that EVERY Premium account spent at least L$1 that month, and
if we assume that the # of unique logins over the past 30 days was typical for November,
Then we see that:
36,000 Premium members spent money in November (6.85% of logins)
85,332 Non-Premium members spent money in November (16.17% of logins)
370,225 accounts logged in and spent nothing at all in November (76.98% of logins)
Seems we have a lot of dead accounts, and a lot of accounts that log in but spend no money at all.
I would like to see economic and login stats divided into three categories:
Premium Members
Verified non-Premium accounts
Unverified accounts
December 12th, 2006 at 3:02 PM
The graphs are a clear indication of why LL is having problems, but at the same time they should be an indicator to LL of what they need to be doing RIGHT NOW to plan for the future.
To anyone familiar with reading graphs, the growth is following a logarithmic scale, where change and growth starts out small and slow, but then starts to race towards exponential growth, where the graph seems to be climbing almost straight up.
The problem is that LL is at a point where the graph is already starting to go exponential, and they do not appear to be prepared to deal with it.
Their database system clearly is not up to the task. Even if they were to double database handling capacity, by their own projections they would eat that 50% extra capacity in a year or less.
The database transaction capacity needs to increase by drastic proportions, right now, in order to keep scaling with future user demands.
LL cannot “just keep a little ahead of it” — they must race ahead and plan in extra handling capacity, to pad against future capacity-plateu problems like we are experiencing now.
A central database core is most likely not the way to go anymore. The database load is too high for a central core to handle anymore. The LL object/texture databases are going to have to become regionalized around the planet, exactly the same way Akamai sets up regional website-mirroring services so we don’t collectively crush the likes of Yahoo.
So the regional databases stream out the huge masses of object data needed to display SL to millions of users. Meanwhile anytime you create something, that is handled by your immediate regional database and sent out to all the other databases over a backchannel database synchronzation service.
Parallelizing is probably the only way for LL to go now.
December 12th, 2006 at 3:09 PM
I feel some concern over these statistics because it seems to me that the level of growth they show cannot possibly be sustainable without a significant investment in infrastructure.
SL is not immune to economic forces - they are the one thing that is not “virtual reality”. Please LL make plans for a sustainable growth level.
December 12th, 2006 at 3:17 PM
seems I know several people who lost money via process credit transactions. apparently when you prcess credit linden labs keeps the money and it never goes to paypal. isnt that theft? theft of US Dollars? and if there is enough aggregate US dollars involved isnt it a major felony?
December 12th, 2006 at 3:32 PM
Angela for theft to happen there has to be criminal intent. Mistakes happen. Let’s not get carried away.
December 12th, 2006 at 3:36 PM
close this blog session subject…. its wayyyyyyyyyyyyyyyyy off the topic way off ..worse than the tale “this old man storyline ” of what he started with geez ,all of you need to get back on track LL close it down . Not worth commenting on the subject and boy do i have a lot to say too !
December 12th, 2006 at 3:40 PM
[...] (more…
[...]
December 12th, 2006 at 3:44 PM
Thanks Zee, for sharing this with us.
It does emphasise what an enormous elephant you guys are trying to eat! Not sure that “one bite at a time” will even come close to hacking it!
I for one am in here for the long haul — this is just too much fun and too interesting not to be a part of. Just please make sure no-one turns the lights out and forces me to leave!
December 12th, 2006 at 4:02 PM
Hi, a few inappropriate remarks have already been removed. Please keep your comments on topic — comments are open because we really value your feedback, and that feedback should be valuable, just like most of it’s been so far.
A link to our Blog Guidelines is in a big font above the comment box, feel free to check it. Thank-you. ^_^
December 12th, 2006 at 4:33 PM
Torley - We really appreciate LL’s feedback too! I have seen a few blogs where LL employees have commented on residents comments. I think it would be great if you/LL/LL employees were able to comment more on residents’ comments. Dont worry, I’m not having a dig, but it makes for a much better discussion if the discussion goes both ways.
December 12th, 2006 at 5:22 PM
[...] Zee Linden announced the posting of five new economic graphs and some supporting data today. Data that we’ve been hungry for, for quite some time. [...]
December 12th, 2006 at 5:26 PM
Hear, hear to Simo Voss and Ceera Murakami.
Blog entries and comments are all well and good, but comments and rebuttals from Lindens would really go a long way to easing my mind, and I’m sure many others, regarding whether any attention is being paid to our opinions.
A further breakdown of the economic data would be welcome. Ceera’s figures echo my own, even bearing in mind that these are statistical data which can be weighted to project a desired outcome.
December 12th, 2006 at 5:28 PM
The economic statistics are interesting, but I spend time in SL because I really love it there. The cost to me is basically the same as cable tv or internet - it’s something I enjoy, therefore I pay for it. If I happen to make money selling and buying land, all the better for it. I am just thrilled to be a part of what I believe to be the future of the Internet.
December 12th, 2006 at 6:39 PM
Well, those Graphs seem to profile a pretty healthy and stable Economy. I find it Not in keeping with all the dire predictions of famine, pestilence, war and Death that one Usually reads in the Forums, and Blogs. Are you sure we are both talking about the Same Second Life?
Angel.
December 12th, 2006 at 6:46 PM
No great criticsim intended to Zee, but once again the use of economic stats to present a point demonstrate it is all in the presentation
Place the graphs on a log grid as opposed to a linear grid and the ever climbing upward curve flattens, agreed at an accelerating rate for some areas, however not at the apparently exponential rate.
Of more interest is the relative slow down in inter resident transaction. The lindens held per user
has actually declined and the relative growth in lindex cash outs has also slowed.
So in answer to many of the queries of whether the economy is benefitting from the new influx of users, the answer is a resounding no.
To look more closely at the premium residents graph, here I do have issues with the comments made by Zee. The graph does not show a monthly growth in premium residents of between 10 and 40% per month, but a growth of between 5 and 30% over the previous month.
If you then take the land growth figures compared to the user base, this has also shown a dramatic slowdown, From July to November premium membership shows a growth of 100% approximatley, from 20,000 to 40,000, the land in SL grows by only 65% from 150,000 sqkm to 250,000 sqkm. If I then take Zees further assertation that 70% of LL revenues for 2006 will come from land sales and maintenance, it would appear logical to assume that with a slowing land ownership per LL user that the projections for next year will demand that LL squeeze land fees further. The reliance on one area of the business to generate such a high proportion of income, is of course a risk strategy a new CFO will be seeking to reduce, so it will be interesting to see what other revenue streams LL will introduce, as they inevitably must.
Far from the robust and healthy growth shown by the pretty graphs analysis of the figures, shows a changing business model and one in which very clearly, the inworld user is making a slowing return on capital invested. Which is perhaps a wake up call to LL as the whole marketing drive now seems to be this is a world in which it is easy to make a living. It patently isn’t and is getting more difficult for many users. (I caveat this comment, by the fact that many transactions are conducted out of grid and do not show in the economic stats, but LL are no more privy to this than anyone else).
For those premium users, who may cheer at the fact that businesses in SL are making less money, so perhaps the original ethos of SL will return. That is not of particular comfort, as LL now rely on increased income from a relatively smaller number of users and will continue to do so, unless they heed teh clarion call by many to not permit free accounts, be they verified or unverified.
The extrapolation of the userbase against the paying user, clearly demonstrates premium members and private island owners, will have to bear much higher costs next year to support the infrastructure. That costing is already impacting on inworld inter avatar activity, which is not showing any sizeable growth and cash outs, which is demonstrating a fall in relative terms, as is Lindens held per user.
Having already begun a round of PI price rises, the mainland has to be announced shortly, but what else is going to be hit with charges, as the reliance on land for LL revenues, when this is trailing the premium member user base and in all likelyhood to fall further as inworld land prices continue to rise, is not a sustainable stream on which LL can rely.
Thanks for the stats Zee, but once again, as I have commented on previous stats information, they are of interest in isolation and of value in comparison. Please keep the information flowing and more of it.
All the best
December 12th, 2006 at 6:58 PM
Zee, Torley–
We often do that with internet traffic to better understand our clientbase’s needs both now and in future and maximize our advertising campaign’s targets.
Can you tell us where these residents are comming from geographicly?
A breakdown by country would be great.
I see alot of growth, but until I see a little better where that growth is comming from, I’m still not clear where these numbers are going (or comming from). Also, tailoring product lines to international tastes and trends is easier–and evermore meaningful–when I know where X-amount of the market share resides.
Thanks & have a great one.
Trajan
December 12th, 2006 at 7:28 PM
[...] Noch vor Weihnachten wird die virtuelle Welt, Second Life, erstmals über 2 Millionen Bewohner zählen. Laut Betreiber Linden sind es derzeit 1,950,245 Menschen, die auf 254 Quadratkilometern monatlich 7,5 Millionen Stunden verbringen, sich mit Freunden treffen und Geschäfte abschließen. Allein im November stiegen die Grundstückspreise um 17% [Linden] [Weitere interessante Zahlen bei Georg Pagenstedt] [...]
December 12th, 2006 at 7:54 PM
I generally like the graphs there, I mean, it certainly helps bring the massive amounts of data into focus. Providing visuals for such data can be quite useful for those curious.
Now for some analysis…
The Premium member graph looks good when placed by itself, but if we’re talking about 43 thousand residents, it is dwarfed by the 1.9 million total accounts. Almost 98% are basic users (and throwaway alts and the like). I certainly don’t want you to pull the plug on free users (especially since I’m technically one of them), but I think it means that there isn’t enough encouragement for them to shell out the money to upgrade to a premium plan. If you can find that tipping point, Second Life will be in for a very dramatic renaissance.
The Regions of Land graph does not measure the income from land sales and tier. It is a good metric for determining how much land is used by residents (and the percentage of total land when that is given) but the income is another value entirely, as tier goes up in atomic levels, and may be underutilized by Premium members either waiting to buy land or simply not using it to its limit. If you want to measure income from tier and land sales, I think you have a more direct means of determining that. I am curious about tier utilization, although considering it will belong to a fraction of 2% of the total residents, I am unsure how relevant it will be.
User Hours is impressive. It helps show the total amount of activity. Seeing it normalized with Active Users or Total Population would better indicate how long each member spends online, and may measure how interested the average resident is in staying in SL.
As for the other two, I don’t think I have much I could add to either one. Very good work y’all.
Now I wonder how these graphs will help LL figure out what to do to keep SL working better? A lot of residents want to know.
December 12th, 2006 at 9:00 PM
The problems in second life are well documented and blamed on many different things however apart from the copyboy and search worries over the past few weeks my buisness has been growing at around 15 - 30% per month i wanna say that ok we all have things to complain about but at the end of the day a lot of the improvments the lindens have made have helped a lot of people and improved a lot of options,i know people are suffering serious grief with inventory’s and things but a lot of good has been made in both options and the ecomony
December 12th, 2006 at 9:03 PM
One thing stands out, or rather its absence: it’s as though June 6 2006 never happened. That was the date that unverified accounts were allowed. There’s no blip or trace of that anywhere in the graphs.
So it seems that unverified accounts don’t really collectively impact the economy or participate in it to any significant extent. That is disappointing.
Or perhaps that is simply due to the fact that the bulk of economic activity consists of land buying and selling, which only premium accounts can do, or trading on LindeX, which only verified accounts can do. Perhaps when it comes to buying goods and services, the unverified accounts are a factor.
It would be interesting to see more detailed breakdowns by category. It would also be interesting to hear from merchants what percentage of their sales come from unverified accounts, and whether that is trending upward or downward.
December 12th, 2006 at 9:07 PM
Something Something.would there be an imediate blip,surely that would be a time when people flooded in to game yes but they would have no lindens and would take at least some time for them to aquire/upgrade or purchase look at the growth following.
December 12th, 2006 at 10:16 PM
Here is another interesting thing we don’t know, even if we knew how much money is being spent by unverifieds.
There are merchants who say that a percentage of their sales are coming from unverified accounts.
But. How many of those are just *alts* who are being given money by their *verified main accounts*? We don’t know. And SL isn’t going to tell us. Nor are they going to change their policy so it really doesn’t matter.
December 13th, 2006 at 12:44 AM
In response to the question about geography by Trajan Sommer, LL would be unable to answer the question, as email addresses give only uncertain clues to geography (think AOL), and most of us log in from dynamic addresses.
It would be easy to obtain a sense of participation by country (or at least by time-zone, which would give most of the information), by tracking log-ins at hourly intervals for (say) fifteen days (to remove effects of daily growth and weekly cyclicality).
In order to do this we need either to ask for it from the Lindens (thoughts from Torley or Zee? BTW, thanks for super feedback); or write approriate code (beyond me, I’m afraid); or co-operate over the three main time zones: Europe, West Coast and Asia/Pacific. If anyone wishes to join with me in this please IM me.
Best
BH
December 13th, 2006 at 6:26 AM
[...] Lindel Lab ha pubblicato attraverso il blog ufficiale di Second Life i dati e le statistiche relative al mese di Novembre. [...]
December 13th, 2006 at 7:40 AM
We passed one million residents on October 18, 2006 …
… and tonight or tommorrow we will probably pass 2 million residents. Please can someone explain how these figures add up? The 1 million residents figure was passed less than 60 days ago, but in the last 60 days, only 789,440 residents have logged in.
LL - what has happened to the other 200,000 people? Are you now classing people who have signed up but have never bothered logged in as residents?
Also, considering that many of the stalwart residents who signed up prior to the 1 million landmark log in regularly and are also included in the 789,440 logins over the last 60 days, the figures look even more skewed!