Alphaville Herald

Linden Land Stats Coverup Enters 5th Month

Lab too embarrassed to publish land data?

by Pixeleen Mistral, National Affairs desk

In February, Linden Lab halted publication of resident land "ownership" statistics after what is believed to be thousands of regions were returned by players reeling from October's surprise OpenSpace price increase. In the aftermath of the negative economic news and removal of the raw statistical data feed, the Lab promised the land stats hiatus was a temporary measure while "we correct our reporting mechanisms to account for the recent addition of Openspaces and Homesteads" and went on to apologize for the "inconvenience".

Five months later, the Lab still refrains from sharing land ownership statistics, leading to speculation that the land market has yet to recover from the Lab's price hikes and a down real life economy. Shocks to the land market are far from over, with concerns that the forced migration to the new Adult-only continent and devaluation of existing Mainland holdings are unlikely to improve the situation as players are reminded that the Lindens changes the rules of the game to suit Lab interests - generally at player's expense.

Given how willing the Lindens are to publish other economic statistics here, we have to ask how bad things look on the land front. If the current statistics are able provide information on land in the process of being auctioned, why remain silent on the actual size of the world?

 

We'll let you know when there is good news

Mystery Inside Investor Sells Stake in Linden Lab

Someone unloaded their Linden Lab holdings - but who?

by Pixeleen Mistral, National Affairs desk

With reports circulating that an individual investor's equity stake in the Lab had been sold to Stratim Capital, the rumor mill can be expected to go into overdrive speculating about exactly which insider sold their shares - and why.

Stratim Managing Partner Zach Abrams is reported to have said his firm "bought almost the entire position of an existing shareholder". Abrams also said the shareholder who sold out was not one of the venture capital firms that have funded Linden Lab to date. Avoiding the VCs may make some sense from Stratim's point of view - their web site claims "to target individual investments of $3-5 million".

While Stratim specializes in "late stage companies with profitable opertations and strong business prospects" at least one current or former Lab insider has apparently decided that their personal financial interests and the Lab's have diverged. The whirring sound you hear is the Second Life fanboi press revving up their spin - as well they might.

As M Linden continues to place his mark on Second Life there have been a number of recent high profile departures from top management - Cory, Robin, Zee, and Ginsu Linden come to mind - a group the previously handled technology, community, finance, and legal/business development areas. The equity stake sell off is sure to add a certain frisson to the speculation -- was the sell off for personal cash flow or due to bad feelings about future prospects for the Lab?

1st Quarter Second Life Economic Results In: QPC holding steady for now

by Jessica Holyoke

After weeks of waiting, Linden Lab recently finally released the numbers needed for the Herald's Economic Department to report Quarter 1's Quarterly Profit per Capita for SL (QPC).  Or at least, most of them.

For as long as the Herald has been publishing the QPC, it has been based on an average of each quarter's total hours logged in per month.  The weighted Positive Monthly Linden Flow (PMLF) is averaged for the quarter and then divided by the average Total Hours Logged to reach the QPC.   The QPC is used to track the in-world economy, not the financial success of Linden Lab.  

The numbers can be used to compare other things, such as the change of THL within a quarter.  Linden Lab, in publishing their statistics, uses a by quarter comparison.  In Q3 08, THL saw a 4.37% drop in THL from the first month of the quarter to the last. Fewer hours were logged in by the end of the quarter than were logged in at the beginning while the Lab reported a quarterly growth of 8.26% from the previous quarter for Q3 08. 

How Profitable is the Second Life Fashion Game?

by Tenshi Vielle

I recently ran a very informal survey at Shopping Cart Disco in attempt to learn what Second Life's fashion designers cash out of Second Life per month. The results are summarized in the table below -- the average earnings for all designers was $850 USD/month.

Inexperienced designers claiming to take home an average of $490/month and experienced designers make $1145 on average.

The figures in red represent claimed income (withdrawn from SL in United States Dollars) averages across the comment input board. Each column is labeled on the bottom for experienced or inexperienced designers.

Here are some comments  from both experienced (1+ years) and inexperienced (under 1 year) designers:

"I’m a new designer, I have a small store with less than 20 products in it and not even a customer group. The past couple months I’ve cashed out $100usd. I made more than that, that is what was left over after I shopped and played around all month, that also is the amount minus my land expenses, etc, and with me leaving some in SL to use. While a hundred dollars isn’t allot by any stretch, I can see how the larger stores with allot more products, a large customer base, as well as several bloggers and magazines that promote them, could be pulling in a living. I’d like to be there some day, but for now my store covers my costs, lets me play and buy what I want, and also gives me a little extra RL cash. :)"

Brunoo Loon Spends L$ Spacebux Fortune on Ads

Half million L$s to buy top spots in Second Life classified ads

by Alessandra Narayan

Look at SL’s search engine and you’ll find three or four companies spending 500’000$L per week in advertising, or around 2000$USD. Whether this should be considers a large or small fortune depends on your point of view, but in any case 500’000$L is a considerable sum.

To better understand the psychology of the big spenders, I interviewed Brunoo Loon, owner of Eish – a store dedicated to sneakers, caps, the IPod MP4 portable player and many other things.

My hope was to learn why Mr. Loon is investing so much money advertising his company instead of cashing it out into real life or donating a part to charity. The answers? Inconclusive. The best explanation? “Being in SL just for fun”, according to Brunoo Loon.

For many readers,  Mr. Loon’s approach may seem odd, especially as financial misery seems to be growing all over the world with a real life fiscal crisis that’s affecting the pocketbooks of nearly everyone - but not everyone can be Brunoo Loon.

Alessandra Narayan (AN) – How can anyone spend so much money in advertising?
Brunoo Loon (BL) – I spend that money with intention to pass Eish! word over Second Life Residents, like other shop owners do.

AN – I asked how not why. Everyone realizes you spend lots of money to advertise your store in the top spots. Anyway, your shop and others must have a big income, correct?
BL – Well, I had better days in my business, but not that bad. I win as many designers on SL win. I can’t compare my business with some famous shops on SL. I just take risks. Advertising is very important in the market so that people know about your shop.

AN – Do you invest money for advertising from your real life pocket or does that money come from the store's profit?
BL – Just SL cash.

Wholesale Fails In Second Life

Full permission sculpty packs – worse than BIABs?

by Tenshi Vielle

Remember the BIAB drama? Business in a box, where you could purchase clothes, eyes, skins, hair, shoes -- all full perm, in one transaction? Dudley Do-Rights in SL would set those up for sale to
make themselves a few hundred USD, while the grid and the fashion world became horribly spammed with the same items at varying prices.

The cool kids now skip the BIAB's and go straight for the full perm light-baked sculpty packs. Slap a texture on, and voila!  $200L instantly made. This does not apply to sculpty collars, jewels, or something like, say, leaves – I'm talking about full perm sculpty shoes or hats, something a creator could just take, re-texture, and sell. The entire practice would take twenty minutes, tops

This practice offends both consumers and creators. Sculpty-pack fashion hurts the consumers because they tend to be ripped off at every turn – purchase the shoes one place, find them textured similarly elsewhere at a cheaper price. Do you really want everything to be a cheap knock-off?

Financial Domme Stimulus Package for Second Life Economy?

by Tenshi Vielle

Financial Domming has recently popped up in Second Life, and is exactly what it sounds like -- there are submissives who fork over their Lindens to the Domme willingly.

This may be the greatest scheme in Second Life - even better than the ponzi schemes virtual banks - because all the rules are laid out for you. There is no going into this blindly, only stupidly - and people are STILL forking over thousands of Lindens for a Financial Domme's services.

One Financial Domme's Classified ad says it all:

"Yes, you've read right. I am looking for bored and lonely housewifes,Social Rejects, Welfare Chics. People with LOTS of time on their hands, to work at GODDESS INVESTMENT! We need good looking AV's, good emoting skills, to work as Dancers, Escorts, Mistress in a FEMDOM club! Just moved to a new location and need a packed Stall of skilled Sub/Domme  Personel. Shemales, Losers, Females,Tgirls, Manly Women Come by and pick up an application by the entrance."

What the ad doesn't say is that they're looking for horribly lonely, naive people, inexperienced people, to play with as well.

Habbo Reports $74 Million in Revenues.

By Urizenus Sklar, still trying to get his money back from uncle Bernie...

TechCrunch is reporting that Habbo hotel is claiming a slight profit of on $74 million US in revenues, principally from the sale of virtual items. However, TechCrunch author Erick Schonfeld snarkily calls it the sale of "nothing" because the virtual goods are "things that have zero marginal cost to produce", which makes me think someone should acquaint him with the concept of intellectual property (does he think there is a marginal cost to producing more copies of software? music? eBooks? soft tools? movies?). But enough about Mr. Schonfeld and the Bronze Age or whatever epoch he is writing from. Here is a 'graph from his article.

In 2008, Habbo’s revenues rose 20 percent to $74 million (50 million Euros), and posted positive operating cash flow (EBITDA) of $7 million (4.8 million Euros). It was even slightly profitable on a net income basis as well, however the company chose not to disclose that exact amount.

Perhaps the bulk of revenues are being plowed back into global expansion or to pay the salaries of Habbo’s 300 employees (yes, 300). But its sub-10% margins so far are underwhelming. And Habbo is supposed to be one of the shining examples of a real business based on a virtual economy. It also makes money from advertising, but the vast majority of its revenues comes from in-world gifting and virtual vanity items.

Virtual vanity items?

Carbonite Makers Cave to Blizzard Directive

by Dr. Legion, staff reporter

We recently posted a story about a dust-up in the WoW community over the new Blizzard policy about addons -- user made enhancements of the game interface. According to the new policy, addons can not be sold and donations can not be solicited in world. Now one target of the new policy -- the maker of Carbonite -- has decided to comply with the policy. They will only solicit donations from their web site (which is allowed by the new Blizzard policy).

It is difficult to know what to make of this. On the one hand it is good that addon makers will continue to develop their products, but on the other hand this sort of quick compliance might embolden Blizzard to flex its muscle against user/developers again in the future. In the meantime, we hope that the Carbonite makers will continue to be able to make money.

h/t WoW Insider

Drama: Online Advertising Cat Fight to the Death

by Urizenus Sklar, from the Failed Monetizing Strategy Watch Desk

Joseph Jaffe and the Crayonistas have departed from Second Life, which is too bad because I would love to have them weigh in on this cat fight. Seems Eric Clemens of the Wharton School had the temerity to suggest that the online advertising business model was fail, and then all hades broke loose. I have to say that Clemens' main  points resonate with this online media mogul:

• Users don’t trust ads
• Users don’t want to view ads
• Users don’t need ads
• Ads cannot be the sole source of funding for the internet
• Ad revenue will diminish because of brutal competition brought on by an oversupply of inventory, and it will be replaced in many instances by micropayments and subscription payments for content.
• There are numerous other business models that will work on the net, that will be tried, and that will succeed.

*nod*

It's time to start *charging* people to read the Herald!

Blizzard's War Against Addon Makers

You can make our game better, but you can't make money for doing so!

by Dr. Legion, staff reporter

Last week Blizzard made an announcement that has been causing a buzz in the usually politically comatose World of Warcraft community. WOW players are probably familiar with addons such as for Zygor Guides, Carbonite and QuestHelper, which are integrated with the WOW user interface (UI).  Some of the addons are wildly popular, and some of the developers make a living just off of donations from (and sale of) the addons.

Now, the owners of WOW, Blizzard, are pulling back on the leash, insisting that while such addons can be made, the makers cannot charge for the products and they cannot solicit donations for the products (they must also make their code transparent).  One side of this is the Blizzard side, which is to say the tiresome line that "it is their game and they can do what they want with it."  The case for the other side is presented by Adam in comments on T=Machine:

Will the Confusion Never End?

SL Fanboiz confooz cashing out with earnings!

by Urizenus Sklar, just off the the phone with Tim Geithner, and TARP money or not, Herald staffers are not giving up their phat bonuses!

In a recent post on New World Notes, Hamlet Au attempts to recharge the Second Life hype cycle by headlining the news that some Second Life businesses are estimated to cash out as much as 1.7 million dollars a year. And that means they are making millions, right? Well, no, but Hammie seems to think so:

"Robin Harper offered some extraordinary financial numbers from Second Life's internal economy: based on a quarterly annualization the company conducted, they discovered that several Resident business owners were cashing out Linden Dollars in excess of a million US dollars a year, with the top earner grossing an estimated $1.7 million."[emphasis mine]

But of course this has nothing to do with earnings. As Robin points out on her own blog, by 'cashing out' she meant just that... cashing out: "

By cashing out I mean literally exchanging L$ for US$. There is nothing implied in these numbers about whether or not any actual profit was made."

We can illustrate in the following way.  Some land owners are known to hold as many as 700 sims.  Suppose they bought them back in the day and the tier is grandfathered in at $190/month.  Let's make that $200/month to make the math easy.  700 simulators X 12 months X $200 = $1,680,000/year that they have to pay the Lindens just for tier.    If they are cashing out to pay them in US dollars, then they are cashing out just enough to pay tier.  This has nothing to do with earnings.  For all we know the business in question is losing money.

MMO Project Entropia to Get Banking License

Real life banking license for spacebux?

by Idoru Wellman, staff writer

Project Entropia has long been known as a hype machine rivaled only by Second Life, and it has also been known as a de facto online virtual casino. Now, according to Ars Technica, it is applying for a banking license - as in a legitimate banking license:

MindArk PE AB, the company behind sci-fi MMO Entropia Universe will apparently be able to let players conduct real-world banking from within its online game. Of course, Entropia Universe actually features a cash-based economy already, where players can exchange real money for game currency at an exchange rate of 10:1 (ten in-game dollars to one U.S. dollar) and then buy in-game items with the money; the game itself has proven to be incredibly successful, having generated over $420 million last year.

Now, though, MindArk's going to be just like a bank in the real world: it will be backed by Sweden's $60,000 deposit insurance, offer interest-bearing accounts for its clients, feature direct deposit options, let players pay bills online, and apparently will offer loans to customers.

The interest, we suppose, is that other virtual world makers (or users) might do the same if this works out.

 h/t to Raph's blog

Metaplace Now Coins Spacebux

Jump starting a virtual world economy

by Pixeleen Mistral, National Affairs desk

While real world economists attempt to unfreeze the global financial system with fiscal stimulus plans, handouts to the needy, and anything else that might stimulate demand, the game gods of Metaplace are in the process of stimulating their own virtual economy - and move from the free-goods-for-all early beta phase into a market-based world.

Over the last few weeks, Metaplace added a virtual currency - originally called “gold” but now named “coins” - and players watched as they magically coined spacebux while visiting and rating other player’s worlds and other normal parts of MP gameplay.

To date, the in-game marketplace has not included a mechanism to charge for user-created content. This is all about to change according to Cuppycake - the MP community manager - and in the next few days there will be charges for both publishing items to the marketplace (250 coins), and a commission fee on sales of virtual goods (25 coins or 10% - whichever is greater).

The coin discussion in the Metaplace forum has raised some interesting issues - will new players start out with enough coin to make a world? could there be a “try-before-you-buy” feature? when will players be able to give coins to each other?

WeeWorld WeeMee Wears Justin Timberlake’s Wardrobe

by Sigmund Leominster

In my last excursion into the world of adolescents and ‘tweens, I became a new avatar, Pixeleen, and let loose my inner Barbie at the Barbie Girls™ virtual world. My latest trip was as a not-so-undercover reporter into WeeWorld, a virtual chat room populated by thousands of two-dimensional characters called WeeMees.

Sigmund Leominster goes WeeWee

WeeMees are not new. Users of Skype, AOL Instant Messenger, Windows Live Messenger, and Friends Reunited have been using WeeMees for years. You can create your own South Park-like avatars, kit them out in an assortment of outfits, and have them appear as your alter ego.
And now there’s a new dimension to the WeeMee phenomenon: WeeWorld. Now WeeMees from across the globe can meet in a real-time 2D virtual world and do all the things that Second Life residents can do.

Or not.

After signing up as Sigmund Leominster and giving my true age (which is old enough to have credit cards and remember that my first virtual world was inside a Commodore 64), I was given the opportunity to create a WeeMee just like me. The piece de resistance was the all-important reporter accessory – the microphone. Now I felt like a real newshound.

Quarter 4 Results - Lowest QPC on Record

Growth rates slow, spending lags residents logged in - bots to blame?

by Jessica Holyoke

Linden Lab has released the economic statistics for the last quarter of 2008, while also claiming the advent of new land offerings - OpenSpace, Homestead and Full sims - are a response to the demands of the majority of the residents. However, some are concerned at the level of spinning on the part of the Lab regarding land - but what do the statisticians from the Herald's economics office say about the other numbers?

Total hours logged in (THL) grew by 3.35% over the course of the quarter, turning positive after the 4.37% contraction over the 3rd quarter of 2008. However, compared to the 4th quarter of 2007, there was a growth rate decrease of 1.14% in Q4 2008.  Looking over the 4th quarter growth rate over the last 6 years, Q4 2008 ranks 5th in terms of % growth rate over a quarter.  The hyper growth of early Second Life seems to be over with anemic rates of growth in total hours logged in compared to the 40.15% growth rate of Q4  2003,  and 23.72% THL growth rate of Q4 of 2005.

LL Playing Gotcha With Land Baron?

IntLibber Brautigan's frozen accounts can’t sell L$ to pay bills

by Pixeleen Mistral, National Affairs desk

  A surprising note appeared on the Ancapistan Capital Exchange website tuesday evening - accord to the press release, IntLibber Brautigan’s virtual land business is having some difficulty covering land tier payments to Linden Lab due to the Lab’s L$ spacebux currency conversion limits.

Linden Lab has an officially sanctioned real money exchange - the Lindex - which players use to both purchase game currency and sell L$ for hard currency. While Linden Lab’s primary business is renting virtual land, a number of entrepreneurs act as middlemen between the Lab and ordinary game players, and accept payment for land rental fees (land tier) in L$. Although the Lab has promoted the in-world economy as a way to make real world money, it only accepts hard currency for land tier payments - and controls the amount of virtual currency that an individual can sell for hard currency.

Apparently, this has left IntLibber Brautigan in a bind, as he claims to have $8000 USD worth of virtual money trapped in accounts that are locked due to delinquent land tier payments.

SL In Deep Recession - Economic Indicators Implode!!!

Group creation and uploads drop 20% in December
LL panics, “temporarily” disables land statistics?

by Pixeleen Mistral, National Affairs desk

The Linden Lab spinmeisters webmasters have chosen to “temporarily disable” convenient display of Islands owned and added on the  Economic Statistics page - perhaps hoping to draw attention away from the virtual economy that is well into a deep recession?

Despite the “disabled” statistics, observers note that the grim numbers are available at the Economic Statistics (Raw Data Files) page could explain the Lab’s sudden reticence - an 8% drop in total islands in November was followed by a further 8% drop in December for a net loss of 3825 islands in 60 days, bringing the island region total as of December 31st to 22,714.

The drop in virtual island ownership is attributed to a 66% price increase Linden Lab slapped on the most popular of the islands - a move many observer’s believe will raise more net revenue for the Lab, despite the number of resident fleeing the price increase. However, resident alienation from the game world’s economy may threaten its viability and further depress demand for Linden Lab’s main product - virtual land.

Resident flight from SL could explain why a number of economic indicators including classified advertising, texture upload charges, and in-world group creation fees shrunk by up to 22% in December. This sort of powerdive in non-bot based activity strongly suggests self-reinforcing economic trends that could lead to the sort of deflationary spiral that threaten a number of real world economies in SL's major markets.

Microsoft's Mundie: Photosynthetic World OK, User-Created -- No Way!

by Pixeleen Mistral, National Affairs desk

Speaking at MIT's Emerging Technology conference, Microsoft egghead Craig Mundie said the 3D spatial web will be photorealistic and made by automatically creating models from pictures taken in the real world -- according to Ian Lamont’s report in The Industry Standard.

While there are certainly uses for a reality-based photosynthetic virtual world, it was a bit of a surprise to hear that Mr. Mundie went out of his way to diss SL’s content creators and the potential of social virtual worlds with user-created content. The Industry Standard reports Mr. Mundie said, "Many people are familiar with Second Life, which is a synthetic virtual world that people came quite enamored with. Our view was that there was a fairly limited audience who was willing to deal with the construction of avatars and operating in that virtual space". Apparently, Mr. Mundie has not yet embraced the charms of mech, steampunk, fur, and Gorean communities, or he would not be so eager to create a virtual world that is nearly indistinguishable from the real world. Has Mr. Mundie been so busy in his lab that he has never been to the movies and is unfamiliar with the concept of fantasy and entertainment?

Given its dominant position in desktop software and deep pockets, whenever Microsoft begins flailing about, the world takes notice, and Mr. Mundie's vision is a dismal prospect for any number of Second Life communities that exist precisely because they do not photographically model the real world. Do the paragons of creativity and user-empowerment at Microsoft understand the potential of the 3D web better than Linden Lab? Consider how successful Vista has been - and then consider the stalled growth curve for SL. Do either of these companies know what they are doing?

SL Sexbed Industry's Dirty Laundry -- Part 2

by Pixeleen Mistral, National Affairs desk

Corsi Mousehold's content inside SexGen bed sold at Stroker Serpentine's store

In part 1 of this report, we heard from Stroker Serpentine - virtual sex entrepreneur and owner of the SexGen trademark - and learned he is now taking an active role in protecting the good name of SexGen.

To hear the other side of the story I contacted Corsi Mousehold - a community leader in FurNation and also a virtual sex entrepreneur. In interviews friday and saturday, I learned how sexbed scripter Briggi Bard had a falling out with Mr. Serpentine, how Corsi became involved in the creation of a 150 animation sexbed, and how Corsi plans to fight if a negotiated settlement cannot be reached. It seems clear that some sort of shakeup is likely in the Second Life virtual sex industry as money concerns and partnerships gone sour roil the waters.

SexGen Trademark Turmoil - SL Sexbed Industry's Dirty Laundry

Trademark owner Stroker Serpentine goes after Corsi Mousehold

by Pixeleen Mistral, National Affairs desk

---

"I will be thrilled to talk at length about how he is selling my animations without permission and using Briggi's scripts without permission... I have been using the name SexGen with his blessing for TWO YEARS." - Corsi Mousehold

"Briggi doesnt deserve to be dragged into this. Corsi is the very reason we aren't partners to this day. I care a lot for Briggi. We were best friends for years - until the mouse came into the picture. Corsi is a manipulative leech." - Stroker Serpentine

---

Cosri Mousehold - SexGen animator and a pet owed by the wonderful Mistress Briggi Bard - SexGen scripter

What has apparently been an ongoing struggle within the virtual world sex bed business went public friday, with Stroker Serpentine and his lawyer contacting the Herald to claim trademark infringement for unauthorized use of the term “SexGen” in a paid advertisement for Corsi’s Creations new line of sex beds - beds that animate avatars in a variety of sexually explicit poses.

Before responding to Mr. Serpentine and his lawyer’s request for removal of the disputed ad, the Herald consulted with Ms. Mousehold and suggesting that the advertisement had probably served it purpose. Hearing no strong objections from Ms. Mousehold, the ad was removed, but not before a bitter dispute between former collaborators was uncovered. Over the next day, I interviewing both Stroker Serpentine and Corsi Mousehold. The third member of what seems to be a love business triangle - Briggi Bard - was unavailable for comment.

SL SHOCK -- Counterfeit Collar Killer Frees Submissive Slaves!!!

Outrage! - Nothing as degrading as a Master Code controlling content creator

by Pixeleen Mistral, Subrealism Affairs desk

An acute reader sent a note to the Herald offices pointing to Marx Dudek's tale of woe - her beloved Amethyst obedience collar was intentionally broken by the creator Amethyst Rosencrans. A visit to Sensations sim confirmed that the "Sensations Collar Team" had placed scripted objects broadcasting commands on chat channel 1 -- commands that kill slave collars scripts.

According to the notecards at the store, this firm but fair discipline on wayward collars became necessary after Linden Lab failed to maintain strict digital rights management over user created content - an unfortunate incident resulting in previously protected collars becoming "fully permissive". With permissive collars being promiscuously copied and resold, the economic rationale for a vital metaverse lifestyle accessory was in danger - and the Sensations team swung into action to disable older versions of their product.

While collar killing may improve Sensations' bottom line, the emotional fallout from this business decision should not be underestimated. As silent commands cause pre-6.0 versions of the slave collar to crash, collared and leashed avatars are able to regain total control their own actions, and risk breaking the bond of trust the develops between a collared slave and master - a sordid end to a virtual romance. How many masters will believe their slaves accidentally broke their collars?

[16:37] MystiTool HUD 1.0.23: (Serenity Rosencrans) [Illegal Amethyst Killer - Ch.1]: *ThisIsSomeReallyLongTextThatWillCrashIllegalAmethystCollars! 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1
[16:37] Amethyst Collar [script:Leash Script]: Script run-time error
[16:37] Amethyst Collar [script:Leash Script]: Stack-Heap Collision

W-Hat Goon's Land for Rent in Baku Sim

Intlibber Brautigan, Woodbury helping keep W-Hat afloat?

by Pixeleen Mistral, National Affairs desk

rent where Plastic duck got his first ban - and the first mega prim was created

Metaverse urban renewal experts and history fans may want to look up IntLibber Brautigan at the Woodbury University suite at the Tampa Marriot Waterside during the SLCC this weekend - it seems that Mr. Brautigan has secured the rights to rent mall space in both the W-Hat sim retail area and the W-Hat land in Baku sim - both sites where the goons have gained a certain level of notoriety for controversial builds - and possibly other activities.

While controversy may upset some, it also creates traffic as curious onlookers come to gawk and anti-griefers come to abuse report imagery they find objectionable. High traffic creates opportunity, but the burden of with endless tier payments to Linden Lab has resulted in a new direction for Baku - an attempt to cash in on the traffic and offset the Second Life land tier payments.

SL's Economic Statistics Hold Steady

by Jessica Holyoke

Positive Monthly Linden Flow growth stays positive

There are a number of theories flying back and forth regarding the state of the Second Life economy, with some advocating for less regulation as a means to make the economy flourish, and others arguing that the performance of a company is the same thing as a virtual world's economy. The bottom line for Rivers Run Red, Electric Sheep Company, and even Linden Lab is in that the fortunes of these companies are in no way an economy. Any fiscal measurements of those companies are either a measurement of their success, or the strength of their specific sector. A company's RL performance is not the same as a virtual world's economy - or 6 economies -- despite what some graphophiliac gadflies might say at great length.

LL Voids Zorkmid Gambling!

Lab changes its mind about Z$ gambling scheme -- was Zara Linden overruled?

by Pixeleen Mistral, National Affairs desk

1Z$ = 1L$ -- now closed until further notice

Second Life’s Z$ casinos disappeared Monday, after the Linden game gods apparently changed their minds about the legality of the Zorkmid Z$ gambling system. Z$ casino owners had claimed their system exploits a loophole in the TOS and RL laws by using a fictional currency for gambling, and allowing players to play a game of skill to turn the Z$ fictional currency into the L$ fictional currency. Linden Lab and others provide foreign exchange markets that allow L$ to be converted into non-fictional currency such as $USD.

As I toured the devastated fictional casinos, the owners did not seem pleased with Linden Lab. denjobi Odell told me, “well it was a loophole .. never official .. and so .. LL changed its position again and told all the loophole gambling systems to shut down before monday”.

Casino Gambling Returns To Second Life

Does Linden Lab approve of gambling for Z$s purchased with L$s ?

by Pixeleen Mistral, National Affairs desk

Z$s cannot be converted to L$s -- so you can cash out here

Just over a year ago, Linden Lab banned gambling in Second Life, a change that sent the in-world economy into a tailspin as virtual casinos across the grid shut down and gamblers took flight from the Lab’s virtual world entertainment product. But now, the casinos are back -- operating under an interesting interpretation of both US law, and apparently within the Linden’s Terms of Service, according to the virtual casino owners.

How is this possible? The creators of the Z$ Zorkmid fictitious currency claim there is a loophole in both the TOS and US law. By using a fictitious currency which cannot be converted directly into L$s, playing games of chance is not really gambling - instead it is a harmless and legal entertainment.

After not gambling on roulette, slot machines, black jack, and similar amusements, pretend punters can pay L$1 to play a game of skill and convert their Z$ winnings into L$s. The object of this game is to match pairs of identical images - with a two minute time limit. The level of skill required is such that most metaverse residents are very unlikely to lose unless they are subject to one of the seemingly random crashes of the SL client software - or massive lag.

One-Hour Abortion Clinic Opens In Second Life Mall

Mall cop says Minerva Linden deleted prim fetus after pro-life group abuse reports --
W-Hat Goons’ Whatview Valley Mall also features Apple Store, Rei’s Rocks, Invisible Prim store

by Pixeleen Mistral, National Affairs desk

teens welcome

Shoppers in WHAT sim will be pleased to learn that the conveniently located Whatview Valley Mall claims to have Second Life’s first and only prim baby abortion clinic. Teens are welcome, and prices start at L$1999, with souvenir photographs available for L$500. A number of virtual world business analysts are now touting this development as a business opportunity with strong growth prospects, given the prevalence of unprotected cybersex in SL, and recession-proof demand for convenient prim baby termination services.

However, there are still challenges for the virtual abortion industry. According to Whatview Valley mall cop Zac Wilcke, there has been some trouble at the abortion clinic recently due to pro-life Second Life residents - leading to abuse reports and and a visit from game god Minerva Linden who apparently deleted the fetus from an in-progress partial birth abortion.

Investors in the clinic were relieved to note that Minerva Linden left in place the shopvac and blood spraying from one of the customers being serviced, sending a clear message about Linden Lab's “Community Standards” enforcement - and also establishing a precedent that allows for at least some sorts of avatar abortions, although not those held to be illegal in the United States. The US Supreme court recently upheld a law banning the Partial-Birth Abortion Ban Act of 2003, so Linden Lab may be seen as simply complying with the law of the land - and helping bring Second Life even closer to real life.

Second Life Herald Opens Lively Office

by Idoru Wellamn, staff writer

Pixeleen Mistral today announced that the Second Life Herald is expanding it's “always fairly unbalanced” coverage of the most vital virtual worlds’ news, by opening a branch office in Lively - internet advertising behemoth Google’s first step toward monetizing the immersive social experience.

Ms. Mistral relaxes in a goth chair on the beach in Lively

Taking a break from decorating the Herald's Lively Google news island with pink google pigs, goth chairs, goth candles, and anything else that might pass as techno-pagan decor, Ms. Mistral said, "Herald readers should look forward to seeing our trademark in-depth reporting and critical analysis expand beyond Second Life and also encompass Google - a company that regularly needs to reminds itself to not be evil. Besides, we can now hold Herald staff meetings somewhere that does not crash continually - running Lively on my MacBook Pro under Parallels is working great!"

Second Life Image Tarnished by Users?

RiversRunRed CEO warns against allowing residents to create 3D content

by Pixeleen Mistral, National Affairs desk

MIT Technology Review writer Brian White advises the metaverse that users may make “shoddy and even offensive content” if allowed to create in 3D worlds -- sentiments echoed by the CEO of RiversRunRed Justin Bovington who praised internet advertising giant Google for hiring partnering with RiversRunRed to create content, and warned against unfettered access to creative tools saying “Many brands have experienced pollution and even counterfeit of their brands in other 3-D worlds or environments--not to mention the questionable material that users put forth that led to a tarnished image for Second Life.”

The controlled content creation issue raises concerns for significant parts of the Second Life population. Goreans, BDSM communities, ageplayers, virtual escort service workers, furries, and others created much of the novelty that attracted both press and players to the Second Life platform as an escape from a humdrum real life. Unfortunately for these groups, the ad-driven worlds appear to be moving in lockstep toward a real-life in virtual-life vision, while being cheered on by the Technology Review. Recent comments by Linden Lab's own Mitch Kapor also suggest that the freewheeling era may be passing.

Although spreading the corporate message may be less effective while allowing players to actually play their own games in an ad-sponsored social space, the boredom factor may force Google’s hand, as the Technology Review story goes on to state that Google is considering allowing user content creation at some unspecified future date. Presumably the danger of brand pollution must be weighed against to lure of free content to drive viewers to tightly targeted ads - Google's stock in trade.

AOL Tightens Belt, Massively Chokes Off SL News?

"Massively Staff" blogs for free at AOL properties after gaming writers are told to stop posting

by Idoru Wellman, staff writer

Techcrunch reports that AOL has savagely cut their blogging empire's staff, chopping personel budgets up to 25% and telling writers to take a few weeks off while they wait and see if they have a job sometime in August. Even more shocking, AOL has apparently decided to discontinue free bagels - a move likely to send shockwaves through the baking industry as bakers struggle to recover from a one-two punch of fewer blog stories and declining corporate bagel sales.

Reliable sources confirmed to the Herald that a budget-induced blogging gag-order is in effect, and a quick visit to one of AOL's properties - Massively - suggests this is true. The normally steady drizzle of corporate-friendly "news" about Second Life seems to have halted, depriving resident of vital information such as the number of user signups in the last 24 hours - statistics mined from Linden Lab's web site, then uncritically posted along with seemingly identical graphs and an obligatory screen shot from in-world -- a continuation of the proud legacy of the now defunct Second Life Blingsider.

Everett Linden Exposes Penis at SL5B!!!

Linden staffer discovers PG-Penis -- leading in-world economic indicators turn strongly positive

by Kris Dibou & Pixeleen Mistral

Marble PG-P OK, wooden boobs-- no way! Game gods roil virtual commodities markets

The first signs of an economic turnaround in the mining industry were evident today, as the overseas futures market in marble textures went wild. The cause? A reliable source informed the Herald that Everett Linden was role-playing a game god when he accidentally gave the OK for David's wedding tackle to flap in the SL breeze- for him to disrobe his probe- for his banan-o to go commando- indeed, for his totem to tan on his scrotum.

As news of the PG penis TOS workaround spread across the metaverse, certain anti-communist columnists and long time supporters of in-world decency averted their eyes -- but the more pragmatic residents rushed to buy options on a few select texture vendors specializing in marble and granite. Given the expected demand for the rare PG-P (PG Penis), the smart money says the fashionable virtual man-about-the-metaverse will soon be sporting a marble chubbie sculptie - driving up the stocks of both classic sculptors, and virtual marble miners.

Meanwhile, the economic prospects for logging concerns in snow sims looked bleak as wooden textured nipples continued to be nixed by Linden Lab, with a number of sources citing the danger of adults pretending to be children seeing the banned boobs in PG rated land.

While a depressed timber industry in the snow sims continue to struggle, marble miners seem to be emerging from a prolonged in-world economic recession. The surprise turnaround was sparked by this conversation, recorded for posterity by several bots who got lost on the way to a their job camping at a deserted virtual shopping mall. The recovered conversation went as follows:

LL - Please Take My Money!!!

Sayden Westland has Second Life billing problems

I HATE SECOND LIFE!!!

Well, actually I LOVE IT, but I need help and cant find anyone to help me. I have submitted support tickets, left notecards at the info center and for numerous Lindens, talked with experienced residents, endlessly searched the info island and help desks and library, scouraged through the video tutorials and called your support lines like 100 times now, and am ready to leave SL, not because I don't love it, but because no one will HELP ME!!!!!! and in fact I just need SL to take my money so I may upgrade my account to premium, is that to much to ask? My support ticket # is 4051-4888995 but I have not received an response and have given up hope that I ever will!!

And I would love to give SL my money, upgrade my account to premium, and buy land and numerous other items but: to no avail, the SL website will not neccessarily take my Credit Card but after weeks of numerous entries and waiting, calling the support lines, it still says UPDATE PENDING!!!!!!, ugh, I cant see that anymore.... Trust me I have checked the Credit Card, even entered several different ones to be sure,*_*KEEP READING::

YES, I have called my Credit Card company and checked all type of security issues so that Linden Labs or Linden Research can debit on my card, in fact my Credit Card company says they don't even see an attempt by Linden Labs or Research to debit on the card or any sort of contact at all, I have checked its validity, and have even entered it on SL Exchange and other sites and boughten Linden dollars successfully..Therefor it has worked with other sites, and I have successfully transfered USD from my Credit Card to SL Exchange and turned it into Lindens and uploaded it onto my in-world account... (at least they want my money). Funny, that it works elsewhere, but not on SL's Website where I can upgrade my account to premium!!!!

ESC to IRS: We Want Beef!!!

Giff Constable and Michael Morton refuse to repay workers for taxes the IRS says the Sheep should pay

by Pixeleen Mistral, National Affairs desk

After acknowledging an IRS ruling stating Second Life in-world greeters the Electric Sheep Company employed to help visitors to the CSI:NY metaverse/television cross promotional event are ESC employees rather than contractors, the ESC is now changing it’s tune.

Rather than compensating employees for the employer tax/social security contributions the ESC should have made assuming that the workers are actual employees, the company is now taking a defiant line - and says that the IRS ruling is wrong.

While this approach will certainly result in more publicity for the Electric Sheep Company, some observers wonder at the potential costs - wouldn’t it be simpler to just pay the back taxes and move on to developing the metaverse? Or are the ESC accountants and lawyers simply enjoying a bit of roleplay after already having written off the tax costs for misclassified employees? Perhaps it is cheaper to pay the lawyers and accountants than the employees?

IRS Says Virtual Greeters Are Real Employees

Electric Sheep Company VP Giff Constable confirms IRS ruling

by Pixeleen Mistral, National Affairs desk

Misty and Maia are employees - not contractors

This weekend, the Second Life Herald learned that the Internal Revenue Serivce has ruled the greeters employed by the Electric Sheep Company for the CSI:NY metaverse/television cross promotional event are ESC employees rather than contractors. The ruling is significant - it suggests a number of Second Life players-turned workers had their employment status misclassified over the last 6 months. By treating workers as contractors, ESC minimized its paperwork and avoided responsibility for federal tax withholding - as well as sidestepping the employer’s social security withholding contribution.

The CSI:NY hypervent was met with mixed success, but continues on a reduced scale providing work for a number of metaverse residents. I spoke with two greeters in-world sunday evening who confirmed that they were still treated as contractors between assisting confused new players:

Pixeleen Mistral: so... are you an employee of the Electric Sheep Company? or a contractor?
Misty Durant: Pixeleen, we are all contractors
Misty Durant: and that's about all we are free to share with you
Pixeleen Mistral: the ESC says so, right? but what if the IRS says otherwise?

Minnu Model Skins PhotoSourced from Renderosity???

Metaverse shocker -- pirated skins being sold in SL!!!

by Tenshi Vielle, fabulous fashionista - courtesy of shoppingcartdisco

Do you remember a while back, when we were talking about "what ifs" regarding stolen content across virtual worlds?

I think the best case has to be Renderosity.com artists' work being bought then redistributed without their permission (and against their own TOS) within Second Life. And of course, the general community in Second Life is mostly ignorant about what goes on at art sites like Renderosity - or, at least, doesn't think to check there first to see if the content they just purchased in SL is stolen.

One sharp-eyed Second Life community member did notice that a skin she purchased recently appeared to be stolen from Renderosity.com - and emailed the creator, which in turn caused the creator to email me to ask for help and find out how stolen things were handled in Second Life. I guided her towards a DCMA, but I would like to share her email and accompanying screenshots with all of you.

Do you recognize this skin? It's actually from Renderosity.com, Danae's Manhattan collection. It's been warped to fit the templates in Second Life… by none other than Minnu Pallen, the "great" skin creator.

More info below the cut, including Danae's original email to me:

Slexchange ATM Script Cracked?

Secret requested when Secret is unknown

by Pixeleen Mistral, National Affairs desk

---

UPDATE: According to über-scripter Day Oh, the bytecode/scripting exploit described in this story is real, but was fixed a month ago. Mr. Oh told the Herald that when crossing between regions, sometimes sims would randomly send sim-to-sim packets to clients. If scripts need to be handed between regions this makes a certain amount of sense - particularly if there were bugs in the server code that resulted in mis-directed messages going to clients -- a plausible explanation for how the server-side bytecode could leak. While it is comforting to hear that the problem has been fixed, the Herald suggests Linden Lab might want to clarify how long this exploit was active and why they have been less than forthcoming with news about this problem and its solution. Meanwhile, those with sensitive scripts might want to update them, on the chance that they have been a victim of server bytecode leakage.

---

Friday, IntLibber Brautigan posted a warning of an exploit allowing technically savvy residents to “capture ATM scripts in bytecode format”. This is a significant development given the number of successful Second Life businesses that use LSL scripts to transfer goods and money -- an un-patched exploit could be a significant blow to the in-world economy.

Because the real wold dollar value of typical SL transactions is low, it is common to automate these transactions. However, automation generally means the scripted transactions are run with minimal human supervision and depend on secrecy for security. This may present a problem. As Mr. Brautigan told the Herald, “with the code obtained, one can make an SLX terminal give you ANY product listed on SLX for free in any quantity or clean out the avatar owning the ATM - all their money - these capabilities have been tested I am told”.

Some observers are concerned that this sort of exploit could destabilize the in-world economy, and Mr. Brautigan reports that his source “has already notified Soft Linden about this vulnerability - he also tried to notify SLX but they said ‘our system is uncrackable’". There we no Linden Lab staff online friday evening willing to speak with the Herald on the record.

While the game gods remained silent, the Herald was able to interview Second Life resident Uildiar Kuhn to learn more about the exploit.

SL Fashion - Copying or Inspiration?

by Tenshi Vielle

I've noticed a lot of confusion about copying and inspiration from other designers, whether it be in real life or in a virtual world. Let’s look at the subject and "where the line is" -- it might help all of everyone clarify where they stand.

Maximilian Milos had an experience last year with Herman Miller. Maximilian really enjoyed the HM designs, and wished to bring them in world. He did what few other designers do - he contacted Herman Miller for permission. HM granted Max permission to replicate their designs.

"Bulletproof Babyphat 2" on sale at SLExchange

However, after a bit, HM began looking into Second Life and around the time that Armani was moving in, HM contracted Rivers Run Red to replicate their products for Second Life. Max was a little concerned, so he contacted HM again and was assured that he was fine, and not to worry.

Max did stop selling his HM recreations after finding out that Rivers Run Red would be doing direct work with the company. He exercised caution - something other people might not have time to do.

Two weeks later, Max logged in to discover that all of his HM creations were missing from his sim - the Lindens had deleted them. Whether this was action from Herman Miller or Rivers Run Red, Maximilian isn't positive. He never received a cease and desist letter -- his items were simply gone. Maximilian wasn't trying to pass the items off as his own designs; he takes care to always clearly credit the original designer. HM wanted it gone, and thus it was so - the Lindens made sure of it. You can read Maximilian's reaction at SLNN

New, Improved Copybot Demonstrated

Remote-controlled bot copies prims, linksets, textures, clones avatar profiles and outfits & saves copies to the user's hard drive

by Proper Prim

---

[UPDATE: Apparently a similar (or perhaps identical) copybot is being sold on slexchange here. Should slexchange remove this user-created content? Might the Lindens decide to have a word with bot creator Marki Young? As we watch this story unfold, I'd like to thank Herald reader Miki for pointing us to the slexchange page. Perhaps Herald reader Robin Linden will will have something to say about this at some point? - the Editrix]

click to enlarge slexchange sreenshot

---

In partnership with d3adlyc0d3c, last week I began conducting an investigation into reports of rampant content theft across Second Life. Some of these claims included allegations that Copybot was being used- allegations that many of us did not believe initially.

Unfortunately for content creators in Second Life, Copybot DOES still exist and is more advanced than ever. Several sources have told the Herald that Copybot had never left SL in the first place as many had hoped - instead, copybot engineers concentrated on a series of improvements to the original model.

'Not only did Copybot continue to function and evolve in SL over the course of the past year, but trying to break it is a futile excercise as it is entirely impossible for Linden Labs to ever prevent individuals from being able to use this or similar functionality' our source told us Thursday afternoon.

After the initial interviews, d3adlyc0d3c was able to acquire a copybot from certain SL 'underground' contacts - he then used the bot to create a youtube video demonstrating some of the capabilities of this software. In the video, we copy one of Apotheus Silverman's large complex builds. After the video was done, we threw the copy away, Apotheus - honest.

Fighting the SL Way - Copy & Resell For Free

Content theft in Second Life on the rise
Don't like someone? destroy their business

by Tenshi Vielle, fabulous fashionista

Resident content theft runs wild while Philip and Robin Linden have gone missing

Content theft has been absolutely rampant in Second Life lately. It's like scabies - once you think it's gone, a whole new bunch of the little jerks pop up.

First we had Nicky Ree's dresses stolen by ADiva, shoes by Enkythings primjacked, then there were a bunch more smaller ...ALLEGED... thefts - a Brasilian user ripped RaC, Redgrave, and a host of other skins, cackling the whole way that no one could stop him. Designers chased him around the grid in a desperate attempt to squash him down, protesting and contacting sim owners to get him shut down. The problem was, he moved around faster than the designers could count and tended to be hard to track.

Ad Farmers Face Game-God Induced Drought!

Resident urged to conserve ads as abuse reports fly!!!
Visual Spam cleanup - or ban on unreasonably land value increases?

by Jessica Holyoke

fewer roadside attractions?

Jack Linden announced a new ban on Ad Farms this past week. While advertising is still allowed, it will be an abuse reportable offense when "it crosses the line into harassing behavior or visual spam, where the intent is purely to compel another resident to pay an unreasonable price to restore their view - then this will be covered under Harassment in our Community Standards." After studying Jack Linden's dispatch, the consensus in the newsroom is the Lindens will now use their highly developed aesthetic sense to improve the state of the metaverse. This new program seems to be off to a fast start, as Patch Linden reported receiving 500 abuse reports regarding Ad Spam as of 9am the morning after the policy was announced. Let us hope the game gods are up to the challenge now that the fallout and possible motivations of the new policy are becoming more visible.

After studying the report formerly known as the Police Blotter, I went to Sallow to try to deduce which Ad Farms were being warned regarding being spam. None of them were the Umnik Hax scheme, but rather a combination of ad towers, some of which had advertisements, some of which did not. Some of the plots were for sale at approximately L$46 per sq. m. and some as high as L$520 per sq.m.

The following day, both Tyrian Camilo and ROBO Marx were warned against violating the Ad Farm policy via e-mail from Harry Linden. The alleged ad farmers were given until Monday to remove any visual spam/land sale notices, lest their accounts be suspended. The location of specific plots where the advertisement network would be considered spam was not provided, perhaps so that residents would not be tempted into second-guessing the Linden game gods' infallible judgment.

Bankplay Banned - High Interest L$ ATMs Must Go !

Linden Lab reacts to Ginko Financial by declaring permanent spacebuck bank holiday?

by Jessica Holyoke

take the money and run

Tensions mounted at the SL Capital Exchange/JT Financial as Linden Lab reacts to the Ginko Financial Collapse.  Ken D Linden posted on the Second Life Blog today a new policy in regards to the in-world banks.

"As of January 22, 2008, it will be prohibited to offer interest or any direct return on an investment (whether in L$ or other currency) from any object, such as an ATM, located in Second Life, without proof of an applicable government registration statement or financial institution charter."

While it is clear bankplay is now on the list of banned activities in the metaverse, alongside gambling, ageplay, and other sorts of broadly offensive behavior, the fallout from this decree remains to be seen.

Expensive SL Classified Ads Ineffective - Save Your Money

Scientific Metamorph Sky Shop experiment shows increased traffic without matching sales

by Michelle Morphett

THE QUESTION:

As the proprietor of the successful Metamorph Sky Shop retail store, I've always been curious about how Second Life's search engine affects my business. Does paying for an expensive classified ad increase teleports from it, and does it increase my in-world shop and SL Exchange sales?

THE METHODOLOGY:

In addition to my regular $L76 Metamorph Sky Shop ad ($.28 US), I placed a duplicate ad for $L1002 ($3.71 US) to run at the same time, from Friday 12/28/07 at 9 pm PST to Friday 1/4/07 at 9 pm PST. This timeframe should be a fairly busy period, since people are still on holiday break but generally back home from visiting family, and have Christmas money in their pockets.

The $L1002 figure was chosen because it places the expensive ad a little above halfway up the first page in a search for "skybox" in the old classifieds search under the "Shopping" category, with "include Mature content" unchecked. Search engine studies have shown that "about 90 percent of searchers looking to shop rarely venture past the first page" (http://www.wired.com/culture/lifestyle/news/2005/03/66893). The same search brings the cheap ad up on the second page, about 2/3 of the way down. The new search in the "Classifieds" category doesn't show either ad in the first five pages, which is the most results possible currently.

Motorati Closes: Second Lifers Just Crash Test Dummies?

by Urizenus Sklar, Michigan Business Desk

SLNN has reported that Pontiac's Motorati Island is closing less than one year after its grand opening. It is kaput. No more. Expired. Pushing up daisies. Finished. Naturally no one is saying why, but it is a sad day on the SL business scene, since (as I argued in an interview on Michigan Radio last year) Motorati was one of the few corporate builds that seemed to get SL right -- offering not a ghost island, but regular events and races and offering free land for people who were making contributions to Second Life car culture. While SLNN reports that Pontiac may have something else in the works, informed sources contacted by the Herald doubt that this is the case (and Pontiac isn't saying).

One quote in the SLNN article summed up the situation perfectly:

Shiryu Musashi, owner of the Musashi-Do Fashion Shop and Musashi Motorsports housed on Motorati Island, commented about Pontiac’s decision to leave SL. “It’s pretty normal; I don’t think it means much – just that another advertisement campaign ended."

Sad but probably true. Until corporations stop thinking of SL as an advertising billboard and start actually building something of lasting value the metaverse is is going to be in Neutral and the gauges are going to read Fail.

Microfinance Business Kiva Announces Grand Opening for New SL HQ

by Urizenus Sklar (cross posted from The Microfinance Report)

Via Fleep Tuque via Linda Zimmer of the Business Communicators of Second Life comes the very interesting news that well known microfinance business Kiva is opening a new office in the virtual world Second Life. Kiva has had a presence in Second Life for some time, but it is obviously looking to make an impact with this January 5 opening party. But why exactly?

 

Scrooge McSheep Cans 22 ESC Employees One Week Before Christmas

Tiny Tim despondent - lumps of coal and company restructuring for the holidays

by Pixeleen Mistral, National Affairs desk

Jeremy Vaught reports on the Second Life Podcast blog that 22 employees of the Electric Sheep Company will have a permanent holiday this Christmas - leaving them plenty of time to select and wrap presents and visit their families, now that they have been sacked by the metaverse development company.

Reportedly, ESC cited financial problems and is "refocusing the business". The group working on MTV projects is apparently still intact, but speculation is that they may be discarded at a later date now that the company is focusing on "technology like onRez". OnRez is a shopping site for purchasing virtual clothing and accessorizing SL lifestyles with possible holiday gifts such as latex school girl outfits, and whip marks and everhard prim genitalia.

OnRez sells milk and cookies, too

Joel Greenberg's Virtual World Ad Network has also been shutdown as part of the ESC company restructuring. According to an e-mail send by Mr. Greenburg to those who had signed up for updates on the project the ad network was about a month away from going into beta test. Tiny Tim was unavailable for comment at press time, but the ghosts of Christmas past, present, and future were reportedly planning a midnight visit to the ESC headquarters.

Stronger Protection for Virtual Sex Toys in SL

Stimulating prospects for fapping-based economy?

by Pixeleen Mistral, National Affairs desk

Benjamin Duranske reports at the Virtually Blind site that a judgement by consent has been filed, settling the copyright and trademark lawsuit brought by several SL content creators against SL resident Rase Kenzo’s real life typist Thomas Simon.

The content creators - including part time nude model Stroker Serpentine - will take away $525 USD in damages from Rase Kenzo - and priceless publicity for their products - having established a what Virtually Blind refers to as “the first formal, if tentative, recognition of virtual property by a U.S. court”. Stroker Serpentine’s SexGen bed is generally acknowledged to be a valued addition to many resident’s virtual McMansions and starter castles/dungeons - and unauthorized copies of the SexGen bed helped spark the lawsuit.

SL Crime Wave! - L$3 Million Bank Heist!!!

Were weekend griefing attacks a cover for banks jobs?

by Jessica Holyoke

Possibly in conjunction with the many griefing attacks of this weekend, the SL banks have been hit by hackers.  L & L Bank and Trust reports that 3 million Lindens were stolen through a hack on an ATM by avatar Hamid Jewell.  This was following an exchange from avatar Betatester Allen that deposited $10 million in Lindens and then withdrew $20,500 L.  While L&L Bank and Trust is waiting for help from the Concierge and Governance teams in getting the money back, other banks are being vigilant regarding their balances. 

Second Life Investor's Bank reported suspicious activity with deposits of fraudulent Lindens, but no damage was done to their bank.  Second Life Business Bank was also hacked into today, but the owner, Anre Heron, was able to put their ATM's offline.  BCX Bank had an attempt on their ATM's today, but according to Travis Ristow, the Linden Risk API and their own security systems were able to recognize the avatar in question before a deposit was made.  Intlibber Brautigan reported no attacks on BNT Financial.  JT Financial and SL Capex also reported no incidents of attacks.

Shaun Altman To Liquidate Ginko "Perpetual" Bonds

Nicholas Portocarrero given 11 days to hand over the remains of $750,000.00 USD in deposits, 18,000 people still holding claims against failed bank.

by Pixeleen Mistral, National Affairs desk

Shaun Altman announced today that as majority bondholder of Ginko Perpetual Bonds, he will take possession of all Ginko assets so that they may be liquidated and a L$ cash distribution made to the approximately 18,000 current Ginko bondholders. Ginko Perpetual Bonds were the financial vehicle used to hold claims against Ginko Financial after the L$ spacebuck bank failed amid allegations that it was a ponzi scheme.

With chances of a Ginko recovery dim and the once popular virtual financial bank's web site shuttered, players may be happy to see something other than long term promises. Mr. Altman already has recovered some in-world assets of Ginko including 1 sim worth of land and some large blocks of virtual stocks and bonds, but liquidating these thinly traded stocks without depressing their value may be difficult.

Former Ginko honcho Nicholas Portocarrero presumably still holds some assets outside Second Life. According to Mr. Altman, Mr. Portocarrero has been given until the end of October to return whatever cash and assets he still retains from the $750,000.00 USD deposited in Ginko Financial. It remains to be seen if this request will be honored, and if the game gods at Linden Lab will take an interest in this situation.

Mr. Altman, a grey fox avatar with blue hair and eyes, took time from his busy schedule to answer a few questions, and shed some light on the Ginko liquidation situation in an exclusive interview.

Pixeleen Mistral: why are you doing this? what is in it for you?
Shaun Altman: I'm the majority bondholder. Like all bondholders, I have an interest in seeing Ginko's assets liquidated so we can recover what funds we can. As the largest bondholder, I guess it should fall on me to step up to the plate and do what I can to ensure that this happens.

Pixeleen Mistral: how many individuals hold bonds?
Shaun Altman: I'm not sure. LukeConnell Vandeverre would have those records. I THINK it's around 18,000 individuals.

Pixeleen Mistral: any feeling for how much in the way of assets you can liquidate?
Shaun Altman: Brautigan is turning over bondholder property in the form of 8,783,436 shares of BNT stock and one sim of land. Assuming that Connell also turns over the bondholders' property as requested, that would be another 8,800,000 HCL shares. These are all of the in-world assets that I presently know about, but I am searching to see if I can discover any more. I've also requested in my press release that Portocarrao turn over any cash or other assets that remain. It is unclear at the moment whether or not he will comply.

Surprise! European VAT Tax Surcharge in SL

Did LL really forget to collect tax until now - or is US$ exchange rate slide to blame?

by Jessica Holyoke

Linden Lab dares to be different - and forgets to include VAT tax in prices until now?

Tax day has arrived in Second Life, but with a surprise twist. Instead of game-related tax collections by the US Internal Revenue Service, Robin Linden announced that Value Added Tax or VAT is now being collected from European Union residents for all services obtained directly from Linden Labs. This raises the question of whether VAT was previously not being collected - or - is this simply a classic Linden Lab public relations disaster as they attempt to deflect blame for the need to raise prices to cover the US$'s slide against the Euro?

The custom in the European Union is to publish prices including the VAT tax, and the presumption is that VAT is added at each stage of a supply chain, manufacturer to retailer - unlike North American sales taxes. Traditionally VAT is also included in the advertised price - but the Lindens have chosen to treat the new VAT tax as a surcharge on their published prices. The Lab is now adding VAT to Premium account registration, land purchased at auction and all tier payments.

Some residents were unhappy to discover they had one day's notice before being slapped with a 20% surcharge. The head of Second Life Investor’s Bank, Tyrian Camilo, reports that the addition of VAT to his banking model, which includes the buying and selling of land to make the interest payments for depositors, will now have an additional 22% cost to his doing business. It seems unlikely that this economic shock will help the in-world economy in the near term.

Second Life's Slide vs. Everyone Else

9 months of losing ground against IMVU, TSO, World of Warcraft

by Pixeleen Mistral, National Affairs desk

SL web site rank falling since January - WoW, TSO & IMVU rankings rising

By at least one measure, Second Life’s growth since January has not kept pace with other 3D immersive environments - including World of Warcraft, The Sims Online, and IMVU. Comparing growth rates between virtual worlds is a notoriously difficult task. Game companies are infamous for inflating creatively defining subscriber numbers and use different methods for counting players. Even worse - independent, verifiable measures of popularity are simply not available - so PR-driven spin generally rules.

However, at the Herald we have access to an elite team of metaverse researchers who suggested that there IS a way to measure (indirectly) the relative growth rates of the media-darling 3D worlds without the game companies gaming the numbers.

How? Look at the trends in the alexa.com rankings of the various worlds' web sites. Alexa.com is an independent web site traffic measurement service that charts trends in web site traffic in terms of unique visitors, page views, and a composite “rank”. Of course traffic to web sites is not an absolute measure of 3D world popularity - but assuming a relatively constant number of players visit the web sites for each world, the web traffic trends should be indicative of population trends in-world. In light of this, Linden Lab's recent de-emphasis of population and dollars spent in-world on their web site's front page makes sense - no point in advertising trouble.