Second Life Insider

Daniel Terdiman's Entrepreneur's Guide to SL

Akela Talamasca — 2007-10-27T07:51:00+00:00

Filed under: Graphic Design, News, Making Money

Daniel Terdiman of CNet has always done well by SL. He writes with honesty and compassion, which is always refreshing when it comes to SL. So, in the deluge of new books coming out on SL, I'm glad he's taken the time to write one of his own. It's called The Entrepreneur's Guide to Second Life: Making Money in the Metaverse. It's geared toward analyzing businesses that work in SL, and how you can create a business that will become successful.

In the referring article, Daniel says that while it's true he's not an SL entrepreneur, he does qualify to some degree in being an authority on his subject. In fact, I'd argue that by not being an entrepreneur himself, he brings a much-needed perspective to the subject. And in seven months, too; that's pretty damned quick. Go check this book out here, and its related blog here.

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Alternate Ginko liquidation plan

Eloise Pasteur — 2007-10-20T16:48:00+00:00

Filed under: News, Linden Dollars, Business, Making Money

Following on from the story of Ginko's long protracted death finally ending in termination, and a shifting to the WTF "rescue" plan Shaun Altman has decided he can do better. He is proposing a clear liquidation plan of his own - for full details read his website. The highlights - Everyone get Ginko stock value to Shaun by the end of October, he'll say what the state of play is on 1st November, liquidate the assets (and say who is still holding any others as best he can), and give the money to Luke to buy out the Ginko bonds so they can be delisted. All GBP holders get some (size to be determined) bottom line return to walk away from it all.

Nobody Fugazi is in agreement with Shaun's analysis of the merits of the WTF plan - a quick bit of back of the envelope stuff at my end gives the same numbers too. Like Nobody, I won't tell you what you should do with your money - it's got to be your choice. It all comes down to a balance of trust - Luke (and maybe Nicholas) v Shaun. Who do you trust the most?

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What Would You do With a Hundred Thousand Lindens?

Aimee Weber — 2007-09-12T12:10:00+00:00

Filed under: Events, Making Money

A funny thing happened to Gordon Wendt on his way through Midnight City. He won $L100,000.

To help promote the soft release of their interactive in-world news kiosks, PR Newswire (full disclosure, they are a client of Aimee Weber Studio) is giving away four prizes of $L100,000 each (one of which was claimed by Gordon yesterday). For the next few weeks, a codeword will be embedded in some random press release at some random day or time.

You can read these press releases in-world using the PR Newswire kiosks located around the grid including :

The central plaza in Midnight City
Aqua
Kula 1
Hawthorne
Lukanida
Slackstreet
Isles of Intrigue2
Fusion Bay
Text 100 Island
Ruby, Ivanova
and many other locations.

If you stumble across this embedded code word, be the first to send a message to Pierre Newswire in-world with the code and you win a bundle of Lindens. The codeword will be clearly labeled, so you don't have to play sleuth to find it, just read and enjoy. If you have your own event or project to promote, go ahead and submit it.

So what would you do with $L100,000? Gordon Wendt posted this question on the official SL forums. The answers varied. Some folks said they would go shopping, some would buy gifts for friends, some would invest in worthy SL projects, and some would: "Cha Ching...cash it out!"

If you're more of a "sexballs and bling bling" kind of resident, there are still three more chances to win a hundred grand of your very own. But Gordon Wendt was a bit more modest as he confessed that he would likely use some of the money to start up a scripting business ... and then give the rest to charity. Aweee!

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Strategic advantages for businesses in SL

Eloise Pasteur — 2007-08-22T01:01:00+00:00

Filed under: Stories, Business, Making Money, Mixed Reality

According to some research from the University of Utrecht (Netherlands), and reported on Lost in the Magic Forest, companies in SL see strategic advantages to being here.

They surveyed all the Dutch companies in SL, and found that the companies experienced "first mover advantage" and an increase in innovation. After this, improved contact and communication is the main advantage - with the companies seeing avatars as the new market to reach.

More interestingly, many of the companies had jumped in with both feet, and were exploring SL eagerly, rather than the toe dipping we've seen from many others - IBM being another notable "jump right in" group who are still here and thriving. Perhaps that's something we should consider adding to Mitch Wagner's 5 things to make your business succeed list?

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Linden Lab appease land barons (at least a bit)

Eloise Pasteur — 2007-08-14T15:01:00+00:00

Filed under: Stories, Linden Lab, Making Money

Over on the blog, Jack Linden has announced that, in response to falling land prices, LL will be reducing the land supply on the mainland to an average of 10 sims per day (from 12-16) until the end of August.

They will also be regularly posting likely land supply levels for the following month, although there is no mention of a "target price" for mainland land.

This shouldn't make any difference to those purchasing islands - but it might make buying to parcel and sell more attractive as mainland prices rise. It's also a nice step towards better communications with us!

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Welcome to Bartertown!

Tateru Nino — 2007-08-12T11:00:00+00:00

Filed under: Linden Dollars, Business, Making Money, Mixed Reality, Op/Ed

"A currency is a unit of exchange, facilitating the transfer of goods and services." - Wikipedia.

"'Fictional Currency' is used as game tokens and have no monetary value in and of themselves and as a result are not be taxable as income. In most cases a fictional currency constitutes a limited license right for use by account holders and is subject to the terms of each Fictional Currency provider. The World Stock Exchange supports the "Linden Currency" (Linden Dollar, LND$, L$, Lindens) and the "World Internet Currency" (WIC, WICS, W$)." - LukeConnell Vandeverre, Chairman and CEO, World Stock Exchange.

Vandeverre is right ... and wrong when he says "have no monetary value". You see, as long as he sticks to first party tokens (W$, in this case) he's right. We're just talking game tokens. However, any interaction with Linden Dollars (L$) or other currencies messes up the statement.

W$ within Vandeverre's system represent a game token. A fictional token, a fictional service - you can get away with calling that a 'game' as Vandeverre does. So long as 'game tokens' can only be purchased, but never exchanged into third-party units of exchange (or third party game tokens) - they remain game tokens. Fictional.

Some jurisdictions consider them tokens even if you can trade them for other units/tokens/goods/services, because they do not fall into that jurisdiction's narrow definition of currency.

Vandeverre's jurisdiction is not one of those. Australia Tax Law recognizes convertible tokens as a barter currency. So, what's a convertible token?

A convertible token is any token which can be converted into a third-party token (third party tokens would be Linden Dollars, for anyone who isn't Linden Lab, US Dollars, Australian Dollars, British Pounds, Trade Dollars, Barter Bucks, or a variety of other mediums of exchange). Like it or not, the Linden Dollar provides access to goods and services within Second Life. By trading in them, and in 'game tokens' that are convertible to them, those tokens automatically become units of taxable value in some jurisdictions, most particularly in Vandeverre's own jurisdiction (Australia).

If you can't use L$ on the WSE or convert W$ to Linden Dollars, Australian Dollars, US Dollars, beer, lap-dances, roof-repairs or anything else that exists outside of the WSE, then they're a game token - but you can, and so they can't be a game token, as he avers.

Now we're into Australian Barter Transaction law. That's records, tax invoices, and the like. Income tax (in and of itself) might not be payable, but there are explicit requirements and taxation on barter transactions, even if I swap you my duck for two of your chickens. Requirements that are no less stringent than any other exchange of currency.

It's obvious from Vandeverre's statements that he doesn't believe that to be so. That doesn't mean he's right, either. I personally, wouldn't place a single unit of microcurrency on the WSE without a published determination from the Australian Tax Office about the status of Vandeverre's 'game tokens'.

That, as I said, is my personal opinion. You, of course, should think about the the issues as you see them and make your own decisions. It's your money - or wait, maybe they're game tokens.

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Ginko Perpetual Bonds live

Eloise Pasteur — 2007-08-10T10:01:00+00:00

Filed under: Stories, Linden Dollars, Business, Making Money

So, I guess this won't reach everyone, given the number of people you still see in the Ginko group saying "Why is the ATM down?" but for those of you that do read it, your ginko former-savings should now be available as GPBs on WSE.

The process is not that complicated - you find a WSE atm in world (there's one on Ginko Financial Island, behind and to the right of the (defunct) Ginko ATM. Type reset password, follow the link to the website and off you go.

If you're determined to cash in your bonds by the way, you'll get a bad price. The best price currently available is L$0.14/share (this changes quite fast, it was L$0.15/share when I started this article), but there are a limited number of offers at that price. You'd be lucky to realise L$125,000 on 1,000,000 bonds (that's former savings of L$1,000,000) - that's 1/8th of the value of your former savings.

I have sold some to see how the interface works. I can't get it to offer me a market sell order, but set a limit sell order with the prices at the best market buy price and it goes smoothly and quickly. In my case I managed to withdraw the money in-world quickly too.

There is a good article here about your options. Nobody Fugazi has some bonds with GPB now (about 183,000 according to a different post), so he's not a disinterested adviser, but then, as you know, nor am I. As I've always maintained in all my financial advice, despite what others seem determined to think, it's up to you what you do. Speaking personally, I'm going to cash enough to be sure I can pay my tier come that time of the month even if it hurts. I'll put the rest up for sale at prices I hope will be reached and won't make me cry for the hit I'm taking.

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Ginko Financial finally dead

Eloise Pasteur — 2007-08-09T06:56:00+00:00

Filed under: News, Linden Dollars, Business, Making Money

As I commented here, Ginko has been in it's death throes for a little while. If you head over to their website now, you will see that they have shut for trading completely. I'm not sure what the financial equivalent of the doctor calling time of death is, but 7:30 p.m. yesterday (SL Time) is that time.

You can read commentaries on the death of Ginko by Nobody Fugazi and Benjamin Duranske, with some interesting cross fertilisation of comments.

Ginko has decided to convert all deposits into GPB at a 1:1 rate (based on face value), creating accounts for all its former customers on WSE, something that the close links between them doubtless help make easier.

Nicholas Porocarrero finishes the letter with the comment:
"Ginko Financial will bounce back from this and if you stick with us, you wll not lose anything. If you must sell the bonds, then you must sell, but I advise against accepting low prices."

Whilst I continue to maintain you should make your own choices about what you do with your own money, I've been fairly forthright in my attitude towards stock exchanges, so whilst I continue to wish Nicholas all the best, I, for one, will be selling, and if it hurts my pocket, well so be it.

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Exodus! Movement of Jah People

Akela Talamasca — 2007-08-09T02:06:00+00:00

Filed under: Business, Making Money, Mixed Reality

Aside from the title, this post has nothing to do with Bob Marley.

This article is taking some pains to cast doubt on the current media belief that there's a business exodus from SL. That's nice, but I think it's still a matter of flogging a dead horse. Take a step back and consider the matter from a different angle. Regardless of where you set up shop, some businesses succeed, some fail. It happens all the time. There is likely a given amount of time in which a company decides that, by THIS date, if they haven't made x amount of money, they'll abandon ship. This is nothing more than what we've seen with the early days of the Internet, when it seemed like any idea was a good one ("Hey, let's make a website that will remind you not to wear white after Labor Day!").

Similarly, then, it must be reiterated: You have to understand the platform if you want to succeed. In this case, simply plunking down a building on a private island is no kind of business plan. You have to engage the in-place community somehow. If RL companies are finding this difficult, it's nothing more than social Darwinism; the companies that remain and evolve will succeed in the end.

(Via computerworld.com)

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How hard did the gambling ban hit?

Eloise Pasteur — 2007-08-07T01:01:00+00:00

Filed under: Stories, Linden Dollars, Business, Making Money

We've started to get a new baseline for transactions and LindeX exchanges since the gambling ban was imposed, ignoring days such as RFL, days with significant downtime etc.

Since the ban, and excluding obviously bad days, we've got 5 days, giving us a mean transactions of $1,194,400.00 ± $25,793.41. For the five days before the ban we've got $1,682,600.00 ± $137,794.41. So, daily in-world transactions are down by about $488,000, and despite the short baseline, there is a statistically significant difference (p<0.01).

Looking at LindeX daily trading, since the ban the average is $214,600.00 ± $18,091.43, before the ban it was $230,200.00 ± $20,921.28. Although there is a difference of just under $16,000 per day, there is no significant difference in these values - indeed if you rank the numbers across before and after, the second and third quietest days on LindeX were BEFORE the ban.
(continues)
Of course there is at least one other factor in the mix: Poor old Ginko. We don't know the numbers precisely, but judging from complaints in the Ginko group IM channel a fair proportion of investors used Ginko to store their rent money and earn some interest on it. There's not much reason to assume a particular bias to a given day of the month, most rental groups seem to charge from the day of the deal, so, roughly 3% of the customers keeping their rental money would be withdrawing each day. They then either pay supply Linden to convert to US$, or pay their agent, who probably pays supply Linden too. When others buy their L$, that's another transaction.

Even with this, which would affect LindeX a bit too, you'd expect (possibly all of it in fact), why did the gambling ban have such a big impact on just transactions and not LindeX? Well, we know transactions is generated from each and every transaction in world. But, if you gambled, whatever your game of choice, the chances are there were a LOT of fairly small transactions.

Lets look at just blackjack as an example: You bet (say) L$50 on a game, and win it, or lose it. If you win, you probably get your stake back, occasionally you get a blackjack and get twice your stake. If you lose, it's gone. But, you keep on repeating and repeating. In an hour, if you went in with L$500 and bet L$50 a time, on many games you'd be up or down a bit, but you'd have conducted hundreds if not thousands of transactions. 500 transactions at L$50 a time is L$25,000 an hour, per gambler... or about US$100 per hour per gambler. US$500,000 is suddenly only 5,000 blackjack hours a day - not that much in the grid. Actual casino profits? Not that huge (especially with some of the games out there that you could easily make money on) so the amount to get cashed out: much, much smaller than you'd think.

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Ginko in death throes?

Eloise Pasteur — 2007-08-06T21:01:00+00:00

Filed under: Stories, Linden Dollars, Making Money

Ginko is basically letting everyone cash out - up to L$1,000,000 a time, if they get the money from somewhere to do it.

According to the letter on their webpage they are seeing support from some customers, whilst getting a fair degree of abuse from other customers, particularly those that (gasp) don't read any of the SL press. (Are there really such people out there?)

If normal banking laws applied to this situation, it's pretty certain this sort of activity would be wildly illegal, and may still constitute fraud and the basis for individual legal cases, although it's not clear to me how it constitutes an ARable offence - just which of the TOS does it break? I find myself hoping, and I do mean hoping, that somehow they pull through. I honestly don't believe it any more, but I can hope.

For those of you interested in the nitty gritty - one has to wonder, despite all the screaming about the gambling ban being the cause, just how much impact the prolonged closure and the continuing poor trading on WSE had on this. I for one didn't know how heavily Ginko was tied in to WSE, and losing trading for over a week, surely had an impact, possibly a bigger impact than the gambling ban.

[UPDATE:] You can read more about the ties between Ginko and WSE here.

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Financial situation a mess

Eloise Pasteur — 2007-07-31T15:01:00+00:00

Filed under: Stories, Linden Dollars, Business, Making Money

Although I report on the economy in SL, I tend to remain on the edges of it - I have a small amount of money in Ginko, but made a decision some time ago that I don't trust the stockmarkets in SL - there are too many steps where things could go wrong:

CEO/Company not trustworthy
Stock Market staff not trustworthy
SL hacks (other than untrustworthy staff misusing what's going on)
Bad server-side security

and I'm sure there are more. It appears over the last fortnight we've seen, from various places, at least the first three of these going on, and probably the fourth too.

We are also seeing serious doubts cast on the probity of how Ginko conducts its business, which is a separate issue to the stock markets, although a number of the same doubts can be, and have been raised about Ginko, along with on-and-off again accusations that Ginko is all a ponzi-scheme. To be honest, I'm not sure I can keep up with all the twists and turns.

I will try to sum up (although it might be out of date before I do) and refer you to sources that give you a better running record of the twists as well as some very thoughtful insights from both a legal and a regular market player's point of view (continues under the fold).
WSE was stung, it now appears because LukeConnell Vandeverre, the CEO, trusted someone who he shouldn't have trusted. The new roll-out of WSE with unspecified "much tightened security" apparently left at least some people still able to 100% access their SL-code. WSE is seeing companies leaving it, and according to some reports is censoring statements by departing company chiefs which are critical of WSE.

Ginko, for reasons which are probably impossible to fully unpack (gambling ban, the fact they're the largest shareholder in WSE's parent company, other run on the system e.g. thanks to reduced land prices), suffered a staggering run. Various investigators are uncovering a variety of dubious practises in their reporting, and interviews and public statements are hardly encouraging.

Ginko was, apparently, planning to buy AVIX, but did this in a rather round-about issue. This fell through rather rapidly, and embarrassingly, after a press conference called to announce the purchase.

Despite Reuter's most recent article about it, the actual impact on the SL economy is hard to assess: For two days after the gambling ban, and with WSE closed, there was no obvious impact. Then Relay for Life gave us a huge daily transactions limit as we reached into our pockets. Then the gird has had issues, which probably started during RFL (not causally linked), but which have resulted in teleports being unreliable, search for places being turned off and an inevitable decrease in transactions because you have to be really keen to shop under these conditions. If the current downtime fixes all of these, perhaps we'll get some hard data without other obvious confounding (and unmeasurable) factors to look at.
Whilst I will continue to try and bring you summaries as this develops, but if you want your news and views up-to-the minute you could do worse than to look at:

Your2ndPlace (up to the minute investor opinion)
Virtually Blind (legal commentary)
SL Reports (Listed company CEO comments)

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Run on WSE

Eloise Pasteur — 2007-07-29T23:10:00+00:00

Filed under: News, Linden Dollars, Business, Making Money

As reported first on both Your2ndPlace and SL Reports (in that order according to my RSS reader) companies are abandoning WSE and heading over to ISE. They are all heading to ISE as well, none to AVIX.
In an entirely separate event, I happened to meet someone who has a company listed on AVIX which is currently trading shares at about half of the normal value. He directly, if without any supporting evidence, said "the cashing out of the gamblers is to blame" and was confident his shares would pick up. Confident enough to recommend them to everyone else.

In the meantime Nobody Fugazi has drawn together an interesting mix of topics to make some comments about transparency in dealings, everyone from LL down is touched within his article, and it's hard to see flaws in his logic. SL Reports has elucidated its transparency policy in line with SLEC guidelines - sadly I can't find a link to the actual guidelines anywhere. Meanwhile, an anonymous comment suggests WSE is editing (I would suggest the word they should use is censoring) critical comments from companies - you can't easily test all of these out, but google has cached some of the entries referred to, which you can no longer find directly... oops.

Phillip is rather regularly suggesting we, the residents of SL, need to police ourselves. Whilst I'm still not sure how we are supposed to enforce any such steps, there is, it appears, starting to be a consensus on steps the financial markets should take to make themselves more reputable.

Interesting times in finance in SL.

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Ginko caps withdrawals

Eloise Pasteur — 2007-07-27T14:52:00+00:00

Filed under: News, Business, Accounts, Making Money

As reported on their website and by Reuters, Ginko Financial has had to temporarily cap withdrawals to L$5,000 per day rather than L$300,000.

Nicholas Portocarrero is, understandably rather buried in IMs, and when I spoke to him, he offered to add a comment here when he gets a chance rather than give me a quote directly.

Maybe I should be careful of throwing rocks, as I sometimes publish thin stories, but I've got to say the implication of the Reuters piece that "Ginko's troubles are due to the gambling ban" is more than a little disingenuous. In about 2 minutes thought there are a number of other possible issues, including:

Lack of trading on WSE (Ginko is listed)
Lower land prices causing a run as people buy land cheap (I helped a friend buy nice land for L$8/sqm yesterday, when was the last time you could do that?!)
Casino owners cashing out
Single bit investor cashing out, particularly if they do it through several alts.

Hopefully we'll hear from the horse's mouth soon, with a suggestion as to when things will be returning to normal as well.

[UPDATE] Nicholas managed to find a moment to give me some comments. There was a run on the bank, he isn't sure why - although he feels both WSE and the gambling ban may have contributed to this. This overwhelmed the bank's reserves and so they have capped them until they can grow reserves once again. Nicholas considers it is more important to keep Ginko investments strong for the long term rather than sell them short to cover a temporary loss. Historians who remember the Great Depression and various "black days of the week" may well agree with him.

[UPDATE] I missed the fact that Reuters grabbed their piece from Virtually Blind when reading the article. Not sure how now I'm looking for it, but I did. You can find the original piece here.

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Tom Bukowski's photo contest - your image on an RL book

Tateru Nino — 2007-07-24T23:00:00+00:00

Filed under: News, Events, Linden Dollars, Making Money, Mixed Reality, Arts and Culture

Tom Boellstorff (better known in Second Life as Tom Bukowski - pictured right) is holding a contest for the image on the cover of his upcoming book, Coming of Age in Second Life: An Anthropologist Explores the Virtually Human to be published in April 2008 by Princeton University Press.

Entries for this competition close at 5pm SLT (US Pacific) on 7 August. The contest terms and conditions are reproduced below the fold. Happy snapping!

DEADLINE: TUESDAY, AUGUST 7, 5PM SL TIME

I want your picture on my book!

I (Tom Bukowski, Tom Boellstorff irl) am holding a contest to select a picture to appear on the cover of my book Coming of Age in Second Life: An Anthropologist Explores the Virtually Human, which will be published in April 2008 by Princeton University Press. This book is an anthropological study of culture in Second Life, based on two and a half years of research inworld. For the cover of the book, I would like to feature a picture taken by a Second Life resident! Here's a chance to have an example of your picture-taking talents disseminated to a wide audience. You've got until August 7, so start snapping!
CONTEST RULES
1) Employees and staff of Linden Lab, Princeton University Press, and Cetus Gallery District Association/Ruttan Development/Ruttan Properties are not eligible.

2) The author of winning picture will receive 2,000 Linden Dollars as a prize, and will be named in the book as the author of the picture if the picture is used. The "most popular" winner (see below) will receive a 1,000 Linden Dollars prize. The author of the winning picture can be acknowledged in the book with their real-life name, Second Life name, or both. There is a chance that in the final phase of producing the book cover, a decision will be made that a picture from Second Life will not be used; for that reason, I reserve the right not to use the winning picture.

3) To be named as winner of the contest and receive the prize, the author of the winning picture must be willing to sign over all rights for the picture to me (Tom Boellstorff), for publication by Princeton University Press.

JUDGING CRITERIA AND TIMELINE
1) Because the idea behind the book is what happens when an anthropologist goes to Second Life and treats it like a strange, exotic culture, I'm looking for some kind of picture that conveys the idea of unexplored territory or a mysterious new world. The preference is for an image that has a theme of social life. This could be community, commerce, dating, friendship, or something I haven't thought about: surprise me! Because the book is reaching out to a broad readership, including people with no experience in Second Life, a picture that requires some familiarity with Second Life to be understood (like a Tringo game, for instance) will probably not work so well.

2) If your picture includes recognizable places or people inworld, it is your responsibility to obtain permission for those places or people to have their likenesses reproduced on a book cover.

3) Pictures should be in vertical format (like a book cover) and the highest resolution possible: ideally, 2100 x 2850 pixels. Jpg or bitmap, please. You can use the Second Life client's own snapshot capabilities, or some third-party program like Fraps.

4) Email your pictures to tboellst@gmail.com.

5) The deadline for sending in pictures is AUGUST 7, 2007, 5pm Second Life time.

6) There will be a panel of 2 or 3 judges. Our first task will be to select 5 to 10 top finalists.

7) On August 14, 2007, I will display the top finalists at the Cetus Gallery District (elektra spark gallery), with the kind support of Ruttan Development/Ruttan Properties/Cetus Gallery District Association. Just teleport to (Cetus 216, 6, 40). Visitors will be able to vote for their favorite picture.

8) We'll have an event in the Cetus Gallery District on Tuesday, August 21, 2007, beginning at 6:30pm, to announce the winner! The party will include the musician Nance Brody from 7-8pm and Dj Jaxx Tardis from 8-10pm. If the winning picture the judges select to appear on the book's cover is the same picture with the most votes, the person who took the picture will receive 3,000 Linden Dollars. If the winning picture the judges select to appear on the book's cover is not the same picture as the picture with the most votes, the person who took the winning picture will receive 2,000 Linden Dollars and the person who took the picture with the most votes will receive 1,000 Linden Dollars.

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On Advertising

Akela Talamasca — 2007-07-21T01:19:00+00:00

Filed under: Business, Odds and Ends, Making Money, Mixed Reality

Doppelganger Studios, creators of The Music Lounge, have come to the conclusion that simulating RL environments from cities such as New York, Paris, and Tokyo might be the key to introduce advertising to its teen audience. The reasoning appears to be that teens are used to seeing advertising in RL, so seeing it in a virtual world that closely resembles RL will make advertising more palatable.

The article goes on to talk about SL, noting its 'haphazard patchwork of individual plots'. Presumably, lack of consistent urban planning is a detriment to effective advertising. Those of you who own your own sims or parcels: Would you put up a billboard advertising a RL brand if given enough money? Is such a model an inevitability? How long will SL remain blissfully ad-free?

(Via http://www.itnews.com.au)

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There can be only one. A perilous tale of island transfer

Tateru Nino — 2007-07-20T08:15:00+00:00

Filed under: Stories, Linden Dollars, Business, Making Money

According to Gigs Taggart, he and several others were scammed for a combined $10,000 US dollars or so, and while Linden Lab appears to have banned the perpetrator, Taggart says that Linden Lab are basically allowing the fraudster to get away with it.

Bargaining in good faith, Taggart made an offer on an island for sale, unaware that the seller was receiving money for the sale of the same island from other would-be purchasers. The first purchaser ended up with the island, but everyone else has nothing to show.

After the fold, Gigs Taggart tells the story.

Gigs Taggart's story:

In Second Life, used island regions are a hotly traded commodity,
fetching prices from $1400 to $2100 on the open market. Usually these
land deals are completed without a hitch, but a series of recent events
has exposed a critical flaw in the system that Linden Lab uses to handle
the transfer of these valuable assets.

Between July 4, 2007 and July 9, 2007, a person operating under the
Second Life name "Juggernaut Stoklitsky" sold the same island region to
6 different people. The first purchase was legitimate; the island was
eventually delivered to this person. The other five buyers were not so
lucky.

Jim Gervais (SL: JR Unknown) was among one of the victims. Gervais paid
Stoklitsky 485 thousand Linden Dollars (1850 US Dollars) on Sunday, July
8, 2006. Gervais suspected something was awry the next day, when he
noticed that Stoklitsky had posted another advertisement on the Second
Life forums claiming to have a region for sale, even though Stoklitsky
only owned two regions.

"I logged into a second account, and sent Stoklitsky another offer,
which Stoklitsky accepted. I asked my friends and family that had Second
Life accounts to make him an offer and Stoklitsky accepted every offer,
even though he only had two islands," Gervais said. At this point on
Monday, July 9, he contacted Linden Lab and informed them of the scam.

In total, three victims paid using Linden Dollars. Jason Giglio (SL:
Gigs Taggart) also paid Stoklitsky on Sunday. Giglio realized there was
a problem when he contacted Linden Lab early Tuesday morning, and Linden
Lab responded that they were "investigating the situation" but would
give no further details. "I really didn't know what to think, Linden
Lab stonewalled me. I didn't get a straight answer until Jack Linden
called me on Wednesday," said Giglio. The other two victims paid using
PayPal.

Linden Lab's head concierge Jack Linden sent a message to all the
victims of this scam on July 17, stating "despite our best efforts we
have not been able to recover funds from [Stoklitsky]."

Several questions remain open in this case. Linden Lab requires from
one to five business days to process the sale of Linden Dollars, with
the typical delay being two to three days. It is unclear how Stoklitsky
cashed out the Linden Dollars he was paid over the weekend, as Linden
Lab became aware of the scam on that Monday.

The victims are working with the FBI and local law enforcement in the
area where they believe Stoklitsky resides. Linden Lab has declined to
take any action on this matter, claiming, "Linden Lab does not generally
get involved in private deals between residents," with only the
assurance that they will "comply with legal processes".

Stoklitsky owned a second island, the disposition of which is known only
to Linden Lab. The second island was not liquidated to pay restitution
to the victims, rather, it appears that Linden Lab has removed the
island, making it available for resale by Linden Lab.

Linden Lab has not responded to queries regarding this matter.

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The New Answer to "How Do I Make Money?"

Akela Talamasca — 2007-07-18T02:43:00+00:00

Filed under: Odds and Ends, Making Money, Mixed Reality

Those of you who regularly visit the Shelter hear this question all the time, and now there's a good answer. Sapphire Technologies is a recruitment company that serves the Australasia region. Visitors to their HQ can listen to employment-related podcasts, or speak with recruitment staffers, as well as play pool or create objects in their sandbox.

Here's what's cool about Sapphire, though: They've fully embraced their virtual lives. From the website: "Find out about our great exploration and settlement in the virtual world of Second Life and come and visit us for yourselves! Learn about why we are there and check out the new frontier of internet interaction." And they even have an SL avatar right on their homepage, as witness this post's image.

This is taking a different tack than many RL companies do, where the purpose is not to sell a product that can't be handled in SL, but a service that everyone has needed at one time or another. Will this be a better fit for SL than product-oriented businesses?

(Via itnews.com.au)

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Canadian TV likes SL

Eloise Pasteur — 2007-07-15T07:53:00+00:00

Filed under: Business, Making Money, Mixed Reality

Canada's Global National TV show started a series about Second Life, and about businesses in Second Life. You should be able to see the video directly here. If you can't, following the first link and clicking the "virtual life online" link will take you there.

It looks at a couple of people in depth, one who has added a SL clothes business to her RL clothes business, the other of whom is a developer within SL, coming from a gaming background. It strongly implies that both of them are successful, of course, and it altogether avoids any of the seamy side of Second Life.

I'll try to keep tabs on the site and catch the rest of the series and post about it too. Thanks to Ironraptor Albion for the tip!

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LA Times with bad headline, but good article

Eloise Pasteur — 2007-07-14T11:01:00+00:00

Filed under: Business, Making Money, Mixed Reality

In an article published today the LA Times reports on the difficulties of RL companies in SL. If, as I did at first, you read the headlines which say:

Virtual marketers have second thoughts about Second Life

Firms find that avatars created by participants in the online society aren't avid shoppers.

You might find yourself with a sinking feeling that it's another dodgy report by a reporter who hasn't done their research, especially since yesterday we spent almost US$2,000,000 in SL. Actually, although it does have an agenda, and that agenda is that RL businesses struggle in SL, it is nicely written and well worth a read. It makes a nice outsider's view of trying to conduct business in Second Life, and some nice comments about the problems, and the plusses that some firms have found.

All that aside, the biggest piece of news to me: Millions Of Us are diversifying into other worlds too.

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