What is Digg?58 Comments
- shadus, on 10/12/2007, -9/+51You can't currently play the dollar values in the market, however, if you earn money in game you really have -zero- problem making a profit. The profit goes to the creators and the people doing real estate... not to the people who want to play games with the value of the dollar vs linden. There ARE people liquidating a vast amount of money in SL, they're just not trying to use market fluctuations to do it. I have a friend (and myself to a lesser degree) who makes a few hundred dollars a week from things he sells there. He regularly transfers a thousand out here, thousand out there (as I do but in the hundreds range heh.) He largely doesn't do much in SL anymore but he's still making residual money from what he has for sale now.
The reality is... those with artistic vision are doing fine. Those who are builders are doing fine. Those who sell services are doing fine. Those who sell real estate are doing fine. Those who do almost anything but try to play a numbers game with the market... are doing fine. Shrug. I'm supposed to cry a river for big investors who wanted to cause massive money market fluctuations to turn a quick buck and couldn't because of the way secondlife's market works? Oh, boohoo. Let me play the worlds smallest violin for you. - zombiedepot, on 10/12/2007, -4/+30When I started SL it was a cool idea, had a lot of potential, and now I think it's completely out of hand. Ever since they opened their own market for trading currency you don't get much of a stipend or a bonus anymore, and it's almost impossible to get anywhere in their economy.
It's right of them to call it a pyramid scheme considering the land barons, casinos, banks, and other dregs stay on top because they staked claim early in the game. The guys beneath them make up the economy, some of them putting their savings into a fad because Anshe Chung, former internet prostitute, became a millionaire.
Before all of this, you could actually have a semi-intellectual chat with someone, and now it seems most people just want to sell you something, sell you their stripper services, or plain just don't speak at all. I figure it's not long before some politician gets interested in all these untaxed and unregulated casinos.
Most of all, it's a shame these greedy bastards ruin it for anyone with an artistic vision for their virtual land. - SilenceBroken, on 10/12/2007, -6/+29Second Life always seemed a bit shady to me. I mean, it's basically turned into a giant Internet brothel, for crying out loud! It wouldn't surprise me if what this article alleges is true.
- asdfrewq, on 10/12/2007, -1/+20"you could actually have a semi-intellectual chat with someone, and now it seems most people just want to sell you something, sell you their stripper services, or plain just don't speak at all."
Wow. I never realised this game was so realistic! - brstilson, on 10/12/2007, -3/+21You don't know what a pyramid scheme is, do you?
- Sandwiches_Time, on 10/12/2007, -2/+16The old saying goes, "Owning land is a great investment. It's the one thing they ain't making any more of."
This, unfortunately, is not the case for "virtual" land.
So sorry. - m3mn0n, on 10/12/2007, -4/+17Great article. I figured as much from my own research, thus why I never went past the trial offering, but this guy really looked at it all from the economist perspective and really explains all their faults with great detail and clarity.
And ValleyWag shouldn't be linked to. They added a paragraph and the rest belongs to someone else. And the guy who wrote the rest posted it (in full) in his own blog: http://randolfe.typepad.com/randolfe/2007/01/secondlife_revo.html - sirloin, on 10/12/2007, -1/+11wow it is more like real life than i thought it was.
- Xorsist, on 10/12/2007, -8/+17Whats with all this Second Life ***** on digg all of a sudden? ***** Second Life.
- zhesuen, on 10/12/2007, -0/+8Reading the comments above, it seems like S.L. isn't very popular with diggers. Most of the commenters don't seem to have a clue what S.L is. Let's make it clear that:
- graphics, yes the graphics suck
- making money, for most is probably even harder than making money from adsense
- activities, yes, 90% of S.L. seems to be connected to casino's or sexclubs
- L.L. can't handle the amount of players, sims are crashing, teleports not working, client buggy as hell
But... I like it anyway, there are not many games where you can create game content yourself and share this with the other players, and while 90% or so of the places are better be avoided, there are also quite beautiful places (especially considering the limitations of the building tools) and nice people to meet. And yes, maybe the friends in S.L. would completely annoy you if you'd met them R.L., but this is a _virtual_ world, so who cares!
Have I made any money? No, not really, think my purse is about 20 US$ worth, nothing to talk about, but I didn't have to buy a game of 60$ or pay a monthly fee of 10$ to get this, you can join for free and make enough money to be able to buy the things you like in S.L. easily, without having to sell your body or spend all days in those stupid camp out places.
If you think S.L. is stupid, fine, the servers can't handle the current amount of players, stay out! But if you think you can have fun building in 3D and give 'life' to your creations with a simple script language, just give it a shot!
- Zhe - Silencer7, on 10/12/2007, -3/+11http://getafirstlife.com/
- randolfe, on 10/12/2007, -2/+10They be true. It's not just a brothel, there's also virtual real estate flippers, rigged casinos, and disturbing pervert clubs. It is a shame for the tiny minority out there who really do use Second Life for more noble purposes.
Of course, I still maintain that most people are there just to try to make money. - organicsalsa, on 10/12/2007, -1/+8A. Second Life is a game. If you enter any game with the idea in mind that you are going to get rich then you are a sucker. Second Life, like any casino game, can go either way. You can put a lot of money on a blackjack table but it doesn't mean you will get a penny in return.
B. Most of the people that play second life don't ever strive for anything more than living their "second life". All they want to do is play a game that they enjoy where they can have fun and shop. Of course they will put money into the game because they have to. It costs money for Linden Labs to develop and advance the game as well as run the servers and someone has to pay for that.
C. Just like real life, if you have the ambition to make yourself successful then you can be successful. If you think you can walk into something like Second Life and take money from the game without putting something into it then you are sorely mistaken. With a gratuitous amount of hard work and effort you can indeed make yourself a nice chunk of money. In fact in many cases with just a minimal amount of work and a good idea, you can play the game(by play, i mean having a premium account with land ownership), and not pay a single penny as your work will pay for any bills.
In other words, when people analyze Second Life in this way they are looking at it from the wrong angle. You could analyze a real life casino in much the same way but in the end the casino is just a business like Linden Labs. - FluxHarmonic, on 10/12/2007, -5/+12Second Life is a joke. I'm glad someone proved it through economics.
- Dhalsim007, on 10/12/2007, -0/+6This story is garbage. Due to SL currency limits, no one can buy/sell large amounts of Lindens, which helps to stabilize the economy there. That would frustrate any real-world "investor" that was looking to profit quickly.
Why don't you go startup a gold mine in WoWarcraft instead, buddy?
Second Life Insider did a good counter-post: http://www.secondlifeinsider.com/2007/01/24/valleywag-plays-the-fool-gulled-by-dodgy-analysis-in-own-haste/ - simpleid, on 10/12/2007, -4/+10I don't really understand what demographic SL targets, it seems like a game people addicted to eBay would play. Is that close?
- returnofmalv, on 10/12/2007, -1/+7The same could be said for the Internet. I can remember a time when the Internet was 90% porn... Actually, come to think of it, it still is.
- wiremonkeymommy, on 10/12/2007, -0/+6So, he was looking for a way to arbitrage and was whining about the lack of it in SL, whaaaa...
That primarily exists in very large securities (stocks, bonds, options) markets that are backed by a primary (goods and services) economy, however, with modern computer driven transaction systems, arbitrage opportunities are vastly harder to identify and execute profitably.
SL has the rudiments of a primary economy at this point. For all of his technical language, he's a dumbass. You *can* make real money in SL, but you have to have some real skills and/or intelligence. - JoeMerchant, on 10/12/2007, -0/+6
If you view it as a game, it's a great value - you can actually create a character and play for free. You might even be able to create goods and services that make you a little money with $0 (but dozens, if not hundreds, of hours) invested. Nifty fun. If you want to throw a few real $$ at the game, it makes it much easier to get ahold of cool stuff for your avatar, but it's not really required.
If you view it as an investment vehicle, you're beyond the bleeding edge - there's nothing preventing any number of entities from turning on a giant L$ vacuum and sucking the value out of what you've put in. If you think you can outmaneuver them and buy low / sell high - maybe you're high enough already.
If you focus on creating cool stuff for people's avatars, I'd imagine you can maybe make minimum wage pretty easy, more if you're lucky.
I do agree there's a problem with the land ownership model - seems far too scarce, and I think that the "taxes" on big land owners are too low. If the available land, divided by number of active players was made available tax-free, with an increasing cost for ownership of larger areas beyond that, of course you'd have "multi" players who try to grab more tax-free land, but still it would bring things more into line with "real life". In the real world, even if you could afford to buy half of west Texas, you couldn't likely support the tax bill. - Machismo, on 10/12/2007, -2/+7I put about 200 or so dollars into SL over the course of a few months. Maybe 6. I wasn't trying to make money or anything, just have fun. When I cashed out, I was surprised how poor my return was, despite creating objects and selling them for major profits. I left with only 45 dollars of the 200+ dollars I dropped.
- robcornelius, on 10/12/2007, -1/+6I regularly hang out in quite a few of the newbie areas of second life to help out newcomers. The second question that I get asked is "how do I make money here". Huge numbers of people expect to just turn up and make real cash. Yes it is possible to make money in sl but it requires time and effort just like rl.
The first question is "where is all the sex" of course.
SL is like the web was in about 1994-5 with loads of people just turning up trying to make money. Everything from individuals to corporations but no one has any real idea what they are doing. The level of sophistication of the tech is about the same. People know what it should be like but there is a lot of work to do before it even gets close. Think Netscape 2.0 as a browser experience. - rumata, on 10/12/2007, -2/+7 A lot of people here seem to be missing the point of the article. The author is not saying you can't get money out of SL. He in fact repeatedly says that you CAN take SMALL sums of money out of SL; what he has a problem with is that you can't take relatively LARGE sums of money out of SL. Just so we are clear, let's define small and large. $27 at one time is small. $120 a month is small. A few thousand dollars a year is small. $300 at one time is small. What is large for the purposes of this discussion? Large is at least several thousand USD at one time. Why is this distinction important? Because the author had a specific test in mind - he wanted to evaluate SL as an economy that is suitable for Wall Street type financial transactions - where we are talking about tens and hundreds of thousands of dollars easily changing hands every second. If you look at it from a Joe Schmo perspective, what Wall Street does is make money on money - not real, tangible goods and services, such as swords, and clothes, or even hookers. Wall Street makes money by investing money (or things that are so liquid that they are equivalent to money) in various creative ways. In order for this kind of thing to work, it has to be backed by a very real economy, with a great multitude of real businesses, cash flows, exchanges of goods, stable currency, liquidity, stock markets, etc. all working together in a very well structured, regulated and reliable system. Why do you think your bank is willing to pay you 5% on the money you put in your savings account? Because they can take your money and make more than 5% on it by investing it in more complex ways that are not necessarily available to you.
To make the long story short - what the author has proven is that SL's economy is not yet robust enough to reliably support these higher level financial transactions. What the SL economy IS strong enough to support are low-level, goods-for-cash based transactions. Kind of like what the real world could support several hundred years ago - you make a thing, you sell a thing. Maybe you lend somebody money and charge them a fee for it. That's it. No checking accounts, no money markets, no mutual funds, no derivatives, no stock exchange. And no arbitrage on exchange rates, god forbid.
Is this conclusion surprising? Certainly not. The real world took hundreds of years to develop to the point where high complexity financial transactions are possible. It's silly to expect SL to shortcut this process so much as to develop a robust enough economy to support this within a few short years.
But calling it a pyramid scheme is also not fair. It's not any more a pyramid scheme than the real world where people who have money have a lot more chance and opportunity to make more money than those who work for a reasonable salary and don't have substantial savings to engage in things like mutual funds and complex financial investments. The SL economy is very young - that is true. It's unreasonable to burden it with tests that cannot even be passed by many real world countries (have you tried making money on the Kazakhstan stock market?) and expecting it not to fail.
Conclusion: Is SL economy real? Yes. Is it advanced? No. Is it growing? Yes. Is its youth such a bad thing? Absolutely not. After all, it Wall Street sharks overran it, it would start resembling RL so much it might loose its appeal.
Just my 5 cents. - neuropsychguy, on 10/12/2007, -1/+5Yeah, except here we call it Digg. :)
- deepsemaphore, on 10/12/2007, -0/+4I have been in Secondlife forabout 1.5 years now so can speak from experience. Facts: Secondlife attracts two extreme type of users (1) those are interested in stuff that are looked down upon in reality, so it's kind of a refuge for those folks...and (2) people who understand the 'idea' behind secondlife and what it can be. I have met literally hundreds of people in the second category, my research network literally exploded. I am now in touch with more researchers in Secondlife than in my real life. There are about 70 university efforts ongoing in secondlife (www.simtech.com). People are using secondlife for a wide range of activities ranging from training (www.play2train.org) to B2B etc.. etc... So I think bottom line, what you experience is a function of who you are and what you can do. And btw Secondlife is not the only platform out there attempting to achive the concept on metaverse OS, there are many out there, and some are headed by really top Comp Sci researchers (Croquet Project). But SL so far according to me beats the competition and is really poised to grow. So basically, if you are 'what can I do now? Give it to me! type, please stay clear of Secondlife, this will save you some misery. Try WoW instead.
- oneiroi, on 10/12/2007, -0/+4Isn't second life what you make of it?
Sure there are shady places but I'm sure you can find your niche.
I've stopped playing, but when I played I didn't pay a cent. I took some free in-game classes on how to make my own objects, it was great. They gave you free textures and you got to learn how to do some really cool things.
So I made my own flying saucer, went around and checked out some of the hundreds upon hundreds of places to explore. Got some free stuff, talk to random people. It was fine. - geuisteses, on 10/12/2007, -1/+5Ok, the article has a valid point as far as PRIVATE BANKS go. They have absolutely nothing to do with the Second Life system or Linden Lab though.
Linden Lab has setup a way for you to extract money from the system if you earn it. There was a survey done yesterday that mentions that Linden Lab is considering having Second Life-branded Mastercards and Visas that will let you directly use your monetary balance for real-life purchases without having to go through Paypal.
http://blog.secondlife.com/2007/01/23/have-you-ever-used-the-lindex-to-buy-or-sell-linden-dollars/
If you are dumb enough in Second Life to give your money to a 3rd party claiming to act as a "bank" and they run with it, that's your own damn fault. Absolutely nothing in this Valleywag article has anything to do with official Linden Lab policies. So yeah, they're right about pyramid schemes. If you want to earn money in Second Life, learn how to create something that other people value. Just like the real world. - Absinthminded64, on 10/12/2007, -0/+3OK - The entire article speaks of banks and other investment targets within the game. It doesn't mention persons selling or buying goods from each other which carries no risk and which does return a profit for so many.
The concept of the game and it's economy are hard for many to grasp but I have little sympathy for persons who put their funds in a virtual bank owned and operated by some unknown character within the game. Losing money after Investing in Festus' grand trailer park development doesn't make my heard bleed either. - EspriteX, on 10/12/2007, -0/+3Eh, I have fun, and its better than working at some mcjob while attending classes.
- Oceas, on 10/12/2007, -1/+4I don't know if any of you are paying attention, but SecondLife is all the rage now that they are going open source on the client (and later the server). I doubt the economy will survive this. The end game is to make this thing the new '3D Web'. The only economy that will be going on in that case is the real one, same as the WWW.
- Vnezh, on 10/12/2007, -1/+4Yes very well written, yet it is well written misleading. Where are his real world examples? It is full of hype to Hollywood levels. I personally have made plenty of money and have gotten it out of Second Life with relative ease. I'm also friends with a clothing designer who makes a few thousand a year. Check out some other more informed articles of people who actually know about the game and still play it. Just as in the real world lots of people start businesses and fail. Just because they fail doesn't mean they are in a scam. It could be through to bad luck, or just a bad business acumen. Also there was someone who commented on a trial period. They haven't had those since I've been in the game. You might need to give it another shot. Also, once again, it is a game!
- zer0cubed, on 10/12/2007, -0/+3Another intelligent rebuttal: http://www.3pointd.com/20070124/sl-economy-not-quite-examined-by-critic/
- Chadster, on 10/12/2007, -1/+3I think SL made a huge mistake by allowing a handful of people to purchase the majority of the land. This isn't fair to the noobs but then again, who said Second Life was fair?
- Homunculiheaded, on 10/12/2007, -4/+6Execept that economic mobility in global capitialism can only be achieved through finding new, exploitable material and human resources. Western low income workers can only develop economicly through the exploitation of Chinese low wage workers, and Chinese low wage workers can only develop through finding new markets to exploit. Think of the end game of global capitialism? Can you honestly explain a system of exchange in which every one has the same possiblity for economic advancement or even a scenerio that doesn't not rely on explioted resources?
ForlornHope has a point, and he's right that this plays out much faster in a virtual economy. - cyn0sure, on 10/12/2007, -8/+9It's no more of a Ponzi scheme than central banks (and the U.S. banking system specifically) is.
- halik, on 10/12/2007, -1/+2You cannot have real commerce or market economy unless you have real property rights. That's why buying "virtual" items or entering into "virtual" contracts is idiotic. Much like what happened in WOW, there's absolutely nothing stopping the owners from taking all the money from their virtual bank and making a run for it.
Moreover, even if the creators of the virtual world decide to create some sort of laws / rules, there's no legal reprocussion in real life. If I take my bank's cash and run, the worst they'll do is perma ban me. - alphgeek, on 10/12/2007, -0/+1Hilarious. I presume you are the same Randolphe who wrote the blog post which Valleywag shamelessly cribbed for this article. I see you already tried pimping your original blog post a bit earlier:
http://www.digg.com/gaming_news/Making_Real_Money_in_Second_Life_is_a_Fraud
Bearing this in mind, it is interesting that you are so derogatory of the activities that occur in Second Life and need to resort to exaggeration and base generalisations to bolster your case:
"They be true. It's not just a brothel, there's also virtual real estate flippers, rigged casinos, and disturbing pervert clubs."
Sure these things happen, just like in the real world. But like the real world, they are overshadowed by the vast majority of positive interactions.
Great to see your Second Life prejudices emerge. Certainly gives us a new perspective on how to take your article. - mst4711, on 10/12/2007, -0/+1SL is comparable to what AOL was before the decentralized Web replaced it in 1994-1995.
Only there is no open, decentralized alternative to to SL. Yet. - JoeMerchant, on 10/12/2007, -0/+1
My approach is to leave the perverts alone - much like real-life. Easy enough to do, most of the time. Especially if you hang out in well policed areas. - bluemansteele, on 10/12/2007, -1/+2SL is what people make of it. It costs money to play most "games". You can log into SL for free and not spend a dime.
The idea of it having a "economy" is a light metaphor at best. - Vnezh, on 10/12/2007, -0/+1Yes just like in real life, avoid rock clubs if you don't like rock. Buy your first land and make your own hangout for like minded individuals. You can even make it private where only people that you invite into your inner sanctum are allowed.
- Jugalator, on 10/12/2007, -2/+3I agree, I'm seeing the same happening on Slashdot and other news sites. Suddenly, it's like a whole lot are playing it, when it's actually quite few when put against other popular massive multiplayer games. Maybe it's about journalists still being all over the novelty value of it.
- mighty_mouth, on 10/12/2007, -1/+1"Can you honestly explain a system of exchange in which every one has the same possiblity for economic advancement or even a scenerio that doesn't not rely on explioted resources?"
Yes: capital accumulation. - MelvinStarbrook, on 10/12/2007, -0/+0i think SL is just a huge upgrade of IRC :)
- mapkinase, on 10/12/2007, -1/+1in other news:
dog bites man, art imitates life. - inactive, on 10/12/2007, -5/+5xor most of it is a straight up advertisement. Propaganda paid for by the makers of SL.
- gamersedge, on 10/12/2007, -1/+1THis is the main grid dumbass. the TG is actually more realy tHAN main grid. the entire article is a flame war.
- bliz, on 10/12/2007, -1/+1Dugg you up for an interesting read...didn't know SL can extend to research...I haven't tried it as SL is not popular over in my country. Is it free?
- polyGone, on 10/12/2007, -1/+1Does anyone know the max poly count for various objects?
yeah, save the jokes..... :P - scabbers, on 10/12/2007, -2/+1Ah internet bubble 2.0... it's so funny to watch.
- Wytefang, on 10/12/2007, -6/+5What a surprise - that the Second Life system doesn't work well when the money has to flow out to the consumer trying to make some $$. I'd care if Second Life wasn't so 1. damn ugly, 2. stupid and boring. Dugg down due to lameness of Second Life.
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