SL Forecast to Lose 10% of World's Private Sims This Year
The latest Second Life economic report from Tyche Shepherd of Grid Survey suggests a grim future for private estates in SL -- since January 2012, the world has lost 1138 regions, from 23,857 to 22,719, for a 4.7% loss of the total private estate landmass. This trend will likely continue through 2012. "About a 10% loss feels right by the end of 2012," Tyche tells me, "somewhere between 2000 and 2300 based on the current trends." This would represent an 8% drop in private estate land revenue for Linden Lab, she estimates.
As we've discussed before, private land is Linden Lab's main revenue source in Second Life -- around 80% of the total, company spokesman Peter Gray told me last September. It's extremely probable that this trend of private land loss will continue, and therefore, unless this revenue is replaced by Premium subscriptions and other revenue, in the next few years, the company's profit margin will likely be in serious jeopardy.
Ms. Shepherd, who I profiled here, is in real life (she tells me) a senior statistician for a renowned multinational corporation, and her SL reports have been praised to me by top Linden Lab staffers past and present as being pretty much on the nose. So I do take her forecast as a deeply concerning sign. Which again inspires me to repeat the calls fellow Linden Lab alum along with me have recently made: Make bold and radical changes to Second Life to grow its userbase and revenue before it's too late.
After the break, read some excerpts from my conversation with Tyche, for more on this continued loss of land:
"The total private estate net loss since January 1st 2012 is 1138 regions. Down from 23857 to 22719 (4.7% in 22 weeks). It's not really sensible to report this as an average net loss per month, as there are significant differences between the amount of loss at the beginning of the year and more recent periods.
"There was much more loss in January and February than in April and May (though these were still net declines).
"The first two months of 2012 were much more week on weekly declines, whilst the last 2 months' patterns can be characterized by slow net growth, until the end of the month, where this growth is cancelled out by a relatively big loss.
"This is very much driven by the larger private estates' calender month billing cycle. The net trend is still down but not as steep as the declines in January and February."
"The region loss is marginally higher amongst Homesteads rather than full regions, and also within Homesteads, the cheaper $99 per sim grandfathered ones are declining, whilst the newer $125 per sim ones are still growing in number. If this keeps up, a 10% loss in total private estates is close to an 8% loss in estate land revenue."