10Linden and Business

So, I’ve been following the whole slexchange.com and Anshe Chung’s “10 L furniture factory to devalue the economy” threads since they more or less started. Anshe (in her lack of infinite wisdom) has decided that the quality of content in Second Life is sub par and thinks she can increase the quality of content by reducing the price of content to 10 L. I knew the woman was a little off kilter, but now she’s proven herself to a complete whack job. And it just goes to show how “uninvolved” Anshe actually is in Second Life, because she actually has no clue what’s on the market, what its quality is, or what its worth….. and mostly because she actually *thinks* she has that sort of influence, which is nothing short of a joke.

And now, here’s just a few things to keep in mind:

(1) 100 people pumping out furniture will make absolutely no dent in the furniture market. There’s *already* 1000s of people in Second Life selling basic furniture, gadgets, and scripts for 10 L and less. Anshe’s 100 people will be no different than the 100 people who will start doing it this month independently, and the new 100 which will start doing it next month, and the 100 people after that the following month, so on and so forth. It’s no different than the dozens of Business In A Boxes with dozens or hundreds of items being resold on a daily basis….. 100 people, while it may sound a lot compared to 1, is insignificant when you compare it to the number of people actually in Second Life who are creating and selling or reselling content.

(2) It might have a minor impact on SL Exchange, but let’s face the reality here. How many people actually *know* about SL Exchange? Often, very often, I’ll get an IM asking if I carry or make such-and-such a product and I will usually say, “No, search SL Exchange for someone who sells one.” The response almost every time is, “What’s SL Exchange?” Also, very few of my sales come from SL Exchange….. it *might* count for maybe 5% of my sale numbers on a good day. Other people I know who use SL Exchange pretty much say the same thing. So, the thinking that dumping *anything* on SL Exchange can damage the economy is a farce in itself because SL Exchange is insignificant when compared to the vastness of the market as a whole. And do you think Anshe is going “pay” big money to advertise products for 10 L along with paying employees? I think not, because that’s a sinkhole where Anshe will *lose* an incredible amount of money….. and while Anshe is a little self-deluded, she’s not stupid.

(3) The 10Linden category? Big deal! How many people actually look through the categories on the left of SL Exchange? Sure, there maybe a few, but I am willing to bet *most* people use the Search function or look through featured items for what they want. Scrolling through a category of 100s of items is just tedious, and people have a habit of avoiding anything tedious. It’s just in our nature. Personally, I’ve never touched the categories on the left…… if I can’t find it in search or it’s not listed as a featured item, then it’s not worth me hunting for it.

(4) If *anything* is going to devalue the market, it’s not Anshe, it’s people’s response to Anshe. If you lower your prices to match or if you quit because you don’t want to compete….. Anshe didn’t destroy your market, you did. When content creators start to devalue their products en mass, then the market *will* devalue. But again, this isn’t Anshe’s doing…… this would be a hysteria response. So, do the smart thing and just ignore it, do what you do best….. build and create.

(5) Business is war. Make no mistake, while you may love your business, business *is* war. If you complain about the competition, you probably shouldn’t have gotten into business to begin with, it’s not for you. Second Life is a capitalist economy, which means someone who can provide a product cheaper and faster…… can and will, and there’s nothing you can do about that. That’s the core nature of business, competition, on all levels. Instead of complaining, spend that time improving your own product line. Focus on your own products instead of on hers….. because once you start focusing on someone else, you’ve already lost the battle, you might as well pack it in and go home.

(6) People love brands. No matter how much generic you flood the market with, people *will* buy a higher quality brand name for a much higher price, particularly if you provide quality customer support for these products….. which I can pretty much assure you, Anshe’s people are incapable of. They can barely get a land deal straight, and people are worried they’ll take over the content market? Seriously, who are they kidding?

(7) People think Anshe Chung was responsible for the land price craze last fall/this spring (and hence can affect the furniture market in the same way)….. and this is entirely inaccurate. Land prices increased because (a) Estate Listings and Mainland listings were not separated, so it was difficult to find good land to start with, (b) The major land barons collaborated with each other and set a bottom line price for parcels of land and then slowly started increasing that price to raise the price of land artificially, and most of all (c) There was a shortage of servers added to the colo-facilities by Linden Lab, so the number of people coming into Second Life was much higher than the amount of land being added to Second Life. And when demand is higher than supply, the prices goes up. When Linden Lab started adding land regularly, and the supply met the demand, the price dropped again. Economies 101.

( The economy is *not* fragile….. in the last year it has taken one screw after another, it’s been literally gang banged by a near continuous chain of events and grid blunders week after week, and it’s still ticking with not so much as a scratch to show for it. The economy in Second Life has proven time and time again that it is highly resilient to whatever is thrown at it…… so, seriously, people, take a deep breath and then let out a sigh of relief.

Anshe can’t hurt you.

Anshe can’t influence the market.

Now, once you’ve relaxed, go and have a coffee or a glass of your favorite soda, sit back at your keyboard, and keep doing what you’ve done even before you heard about this 10Linden thing…… because it’s like everything else with Second Life. It’ll be forgotten in a week or two and it’ll just be another piece of history everyone has forgotten about.

Cheers!

- Lillani