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Mercantile Insanity, a Longer Version

I have found it a little challenging to marshall all of the points I would like to make regarding the recent Xstreet Outrage in time to make a Journal Entry that remains relevant, but that is one of the challenges of Journalism really, that and coping with acute liver complaints and the strain of having to associate with other journalists.

Luckily, since I am a Vanity Published Journalist, I am able to simply present bulleted lists, and not have to worry about an editor rushing into my office, swatting me with a fedora and saying "Ordinal! This is a load of lazy tripe! I'm hiding the whisky bottle until you do me some better damn copy!"

The Linden measures, summarised:

  • Free items to cost L$99/month each to list.

  • Paid items to cost L$10/month each to list, and have a minimum commission of L$3 each. (The commission on items of items costing over L$60 will remain 5%.)

Obviously intended results:

  • A reduction of the number of items through people removing them rather than pay extra fees.

  • A disproportionate reduction in the listing of cheap and free items (particularly free ones - it costs almost ten times as much to list a free item as a paid one) and to encourage the listing of higher-priced items. The flat fee per listing and minimum commission are a proportionately lower percentage of profit the more expensive the item - in other words this is a regressive sales tax.

  • A raising of prices to cover new charges, and the corresponding rise in commission.

Results which may or may not have been consciously intended but which should have been obvious:

  • Less competition means that merchants who remain no longer have to compete with free and low-priced goods in terms of quality; there is no longer a baseline. I would not expect the general quality of items to go down due to this, but it will be less likely to go up.

  • A reduction in the diversity of goods, not only their number. If there is an incentive not to list something which you are not sure will sell, you are less likely to do so. This discourages merchants from taking risks. Even quite simple strategies such as selling five copies of a dress in different colours may be uneconomic if one has a large range of dresses. Ordering an item with options such as colour could of course be implemented in Xstreet, but is very unlikely to be, as that would involve some sort of software development.

  • The distribution of the message that Xstreet is for a certain sort of person to make money. It is not a general method of distribution for educators or philanthropists. I also say "a certain sort of person" because the economic engineering here encourages certain business models over others. There is no economy of scale and no attempt to allow for one; you should be making small numbers of high-priced items that all sell well, not even small numbers of high-priced specialist items (see above).

  • A corollary to that is the message that Linden Lab is not interested in you making things better for other residents by means of its services. In fact, Linden Lab would rather that you didn't, and will charge you more if you intend to. You are not conforming to the vision of seller and customer. The fact that this announcement comes at the same time as eliminating mentors I am sure is coincidental in terms of timing, but not, I believe, in terms of motivation.

Statements which are not convincing:

  • That free items on Xstreet are simply advertising. This is such a stupid assertion that I will simply sneer and move on.

  • That this is to "reduce clutter" and make it easier for customers to find quality items.

    Firstly, as an observation, it is quite telling that low-priced and free items are simply termed "clutter" - I assume that all the high-priced rubbish in Xstreet is somehow not cluttering the place up.

    Secondly, Xstreet really is not all that cluttered if you know what you are looking for; just search for "shoes" and yes, you will get rather a large number of results. My problem when using the site has always been (a) how to properly get to the subset of products that I am interested in - the search and metadata filtering is generally poor, and should be greatly improved - and (b) how to tell which of the - frequently rather expensive - products I find are any good. Price is absolutely no guarantee of quality or authenticity on Xstreet.

Things that I have done or will do:

  • Remove all of my items from Xstreet until such time as these policies are amended. Even if I had no moral objections to the broader effects of the changes themselves, I really do not see why I should pay more money for a worse service.

    Realistically a change or reversal is very unlikely to occur, and once I have deleted the listings (as opposed to simply taking back my Xstreet boxes) I am very unlikely to fight Xstreet's appalling excuse for a merchant UI in order to put them back, so in effect I will no longer be selling silly guns or providing Slurlbloggers, Twitterboxes, Snowball Systems or any of the other free items via Xstreet.

    (Edited to add: actually it seems I am able to simply make items Inactive, which I had not previously had cause to do, so in theory I could put things back quite easily should the situation change. Which I very much doubt it will.)

  • Make it clear in my inworld establishments why this is.

  • Not buy anything as a purchaser from Xstreet. This will not be a huge trial for me as I only rarely did anyway.

  • As the one useful thing about Xstreet for me was that it gave people the ability to send Copy/No-Transfer products of mine to others, I shall attempt to script a system which allows this, and once I have done so, I shall make it publicly available. Though not of course on Xstreet. I would also like to have some sort of mechanism to allow people to send items to themselves or others via the Web, which is often convenient for Educational Things.

    The production of such a system does of course rest on my continuing interest in selling items at all, which is not guaranteed and most certainly waxes and wanes; thus I make no promises on this score.

A few final points:

  • I am not particularly incensed by price rises and the motive of profit in themselves - by now I am used to such concepts - but I am somewhat miffed to see both crude attempts at socio-economic engineering and also the facile arguments being used to justify them, as if everything was All For Our Own Good. The "Free Items Are Just Advertising" part, particularly, feels like a child giving you an earnest ethical justification for why it has stolen a biscuit. If we are to have autocracy or even a strict commercial provider/customer relationship with the Laboratory, we should at least have them in an adult way.

  • I am also miffed at the suggestion that Residents Asked For This And Lindens Just Replied. The "consultation process" in this instance was simply laughable. Three poorly-advertised office hours sessions, each attended by a handful of people (the most miniscule fraction of the constituency imaginable), during which the proposals originated from Lindens in any case; then a blog post announcing it as fait accompli. Not exactly Athenian. I would actually have had more faith in a hand-picked focus group assembled to ponder a Linden suggestion, since at least that would imply an interest in what some residents had to say, rather than using them as an excuse.

    There is a broader point here regarding the growing trend towards Officeocracy, but I think that is best left to a future entry, given that this one is already of considerable length.

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Scott M.'s picture
21 Nov200921:53
Scott M. (not verified)

Well said, as usual.

I can't quite tell if LL's motives are as stated (albeit poorly, as you note) or if they have some ulterior motive. Hanlon's razor suggests they actually are trying to respond to what they feel are issues with the XStreet Web site, but doing so with a complete lack of understanding of the site's interaction model and the behavior of its users. XStreet has never received that kind of consideration and that should be the first stop (if the project were handed to me I would completely re-evaluate the mental model from the ground up). What makes it further apparent that whoever is responsible at LL for this fiasco is completely out of his/her depth is the attempt to change user behavior with economic disincentives. It really is amateur hour over at the Lab.

Troy McLuhan's picture
21 Nov200921:55
Troy McLuhan (not verified)

Do you think you might try one of the alternatives to XStreet? Eloise Pasteur has been reviewing some on her blog at eloisepasteur.net.

Ordinal Malaprop's picture
21 Nov200922:21
Ordinal Malaprop

Scott: indeed; the degree to which there is conscious intent is always hard to judge. I tend to assume that anybody making statements such as "freebies on xstreet are just advertising" and "there was resident consultation" _must_ be up to something, but there is a chance that these were honestly believed (worrying in itself).

One thing I didn't mention, incidentally, was quite a bit of switching between "residents decided" and "we decided" in blog comments, but again, that isn't necessarily reflective of anything deeper.

In general I must say that Lindens almost always do seem to be honestly trying to do the right thing from their perspective. There are very few occasions where I have thought "they're just flat out lying to us here", and there are not many companies of whom one can say that. However, that still allows for confusion and mistakes, unstated internal pressures and also the fact that what they consider the right thing, particularly when it comes to underlying goals for Second Life itself, may simply not be what residents would consider it to be.

Ordinal Malaprop's picture
21 Nov200922:23
Ordinal Malaprop

Mr McLuhan: I did have a look through the various alternative services but I have to say that on first glance I was not amazingly impressed with any of them as a solution for myself (perhaps they would suit others). I am not much bothered about web sales - web distribution of free items is another matter, but one which I can likely manage myself, if I can get hold of a suitable source of name2key information - and my major concern is to provide facilities for gift delivery of no-trans items, which I should _also_ be able to manage myself.

Bunny Halberd's picture
21 Nov200923:19
Bunny Halberd (not verified)

Very nicely written.

I would like to add one point if I may - it is no mystery that existing large merchants are in favor of this change. Setting a price floor is a very effective means to raise the barriers for entry, thus making it harder and more expensive for new merchants to get started.

- Bunny

Punky Pugilist's picture
22 Nov200900:43
Punky Pugilist (not verified)

I agree with your summary of this issue. As a freebie builder i have distributed over 50,000 free items on Xstreet in two years. I hope they are of good quality and most were rated five stars.

One of my items, Stonehenge, used sculptis, original textures, and a huge amount of effort. It was free. It immediately blew away the two other Stoneheng offereing, both of which were actually of very low quality - just a bunch of square grey prims.

Its these failed merchants who are forcing this issue. The cant compete in quality...

Check out our protest video - By Natascha Randt


Thanks for letting me express my opinion
Punky Pugilist

Unguent Whitfield's picture
22 Nov200902:30
Unguent Whitfield (not verified)

It seems that wandering the meta-verse instils a sense of freedom and liberty, and one forgets that each and every pixel is seen in terms of profit and loss by some.
Political scientists might find Second Life of interest as model of Corporate control of Society. This situation is an interesting experiment in "the Corporation" controlling the behaviour of "the Society" while still trying to maintain the illusion that the members of that society have any rights at all.

It must surely be clear to all now that whatever Second life pretends to be IT IS DEFINITELY NOT A DEMOCRACY. One would be wise to keep this in mind when one invests ones time and money. It feels unfair? Remember that the majority of people on the planet are Governed in a similar manner in their day to day lives, and those poor souls cannot simply switch off.

Perhaps I shall spend less in Linden Labs and donate to Amnesty International instead.

Excuse my Digression from the details of the topic at hand.

Unguent Whitfield

Nima Benoir's picture
22 Nov200903:23
Nima Benoir (not verified)

This is outstanding! I've linked your article to my Ning site. I too will be pulling all but one of my items from Xstreet before the changes take place.
(I'll leave one for advertising purposes only. I am an artist and simply can't afford anything more for occasional sales as this is a labor of love rather than profit.) I feel these policy changes will adversely effect the diverse artistic community of SL. It is such a shame that the Lindens don't realize the goldmine they have. The dynamic imaginative inventive creative community makes Second Life what it is and residents should be treated with a little more respect and reverence. Unless of course the ultimate goal is to abandon Second Life and Embrace the new and perhaps more lucrative Enterprise model?

Fogwoman Gray's picture
22 Nov200904:32
Fogwoman Gray (not verified)

I just find it terribly ironic, if not surprising.
I am reminded of the landlord that "allows" residents to paint, landscape, and improve his properties at their own expense, then raises the rent when they are done because it is worth more now.

Daniel H.'s picture
22 Nov200913:30
Daniel H. (not verified)

There actually was a lot of free crap on Xstreet SL.

I think one should wait 6 months at least and see results before using the 'fiasco' word.

Daniel H.'s picture
22 Nov200913:37
Daniel H. (not verified)

I frankly cannot see where you read that Second Life is supposed to be a "democracy".

Second Life is an online service, provided by a corporation.

I'm not disappointed because I have different expectations than most people in this discussion. And trust me, I'm all for freebies and sharing, they bring value to SL experience.

Unguent Whitfield's picture
22 Nov200915:09
Unguent Whitfield (not verified)


It isn't that I have read somewhere that Second Life is a Democracy.

Indeed it sometimes amuses me that many people believe they have any rights at all in Second Life. A quick glance at the TOS will end such delusions of equality.

I was merely pointing out that very fact, despite the Linden's claims of listening to blogs and such.

There really isn't a lot of point in complaining, we will either "rub the lotion on our skin" or "get the hose".

The only real way to make a corporation sit up and take notice is to stop consuming.

You suggest waiting to see for six months.

I suggest ceasing consumption for that time.

Take this next six months to re-evaluate how second life fits into ones life,
and if any corporate entity really should have such influence on any individual, virtual or otherwise.

( oh and by the way, those of us who might have supported the use of Second Life for Business "Enterprise" might be a little less enthused at the next board meeting )

Lucy Rust's picture
22 Nov200921:41
Lucy Rust (not verified)

I could not agree more. I am one of those merchants that do pretty well on Xstreet. I limit my offerings and my freebies naturally, (mostly because it is such a pain in the backside to list it.) The fees in question will not impact my financial ability to list current or future products. They will, however, severely hamper my will to do so.

I am incensed. The smoke and mirrors, condescending, techno double talk is an insult to my intelligence. In a world where multi-billion search algorithms are conducted daily, in a thousand different ways, I find it mystifying that we are expected to believe that the preferred solution is to cut content.

As soon as I can copy and paste my way out of it I am done with Xstreeet. (Within the next day or two.) I have moved all my freebies and lower cost items to my in-world store.

I also agree that the alternatives choices are not stellar. I have chosen one to support for the time being, mostly as a place to direct customers who like to purchase merchandise on-line.

Abstract Jigsaw's picture
28 Nov200923:30
Abstract Jigsaw (not verified)

Try this

huge database its neva failed me so far :)

Virtual Bob's picture
29 Nov200909:17
Virtual Bob (not verified)

It's a brilliant idea on Linden Lab's side. Reduce clutter and make money in the process. :)

Vivito Volare's picture
07 Dec200905:20
Vivito Volare (not verified)

You have covered most of the key points I have been thinking about on this matter. What has happened here is no surprise, save that this was not nearly so drastic or user-alienating as I would have expected.

For myself, the irksome thing is the lack of vendor/customer relationship with The Lab. Whether it has been gambling, Open Spaces, or this, the pattern has been to blame a large percentage of the user base for the shortfalls of another group of users as a justification for their actions.

Other businesses manage to maintain the broad goodwill of their users even when rolling out unpopular and poorly researched business plans. Somehow, Linden Labs misses the mark on this far too often.

Gooden Uggla's picture
10 Dec200903:12
Gooden Uggla (not verified)

Excellent summarization. I agree with most of it, even though Jack Linden told a number of bald-faced lies during the openspace moneygrab...

This particular moneygrab is nothing more than trying to reduce expenses while maintaining the revenue stream. The fact that it's being presented so clumsily should surprise no one. It's LL's trademark.

They really are just a bunch of kids who put on a show in a barn and ended up with a broadway hit...

I do think you give the LL policy makers a little too much credit - in regards to their honesty - I personally support and defend the underpaid rank-and-file Lindens that work very hard to keep the world going. That kind of dedication is rare in this world, especially since they're just as mistreated by management as we are. It's too bad that LL just can't say "we aren't making enough with this product, we have to streamline it's use and change fees".

It's not that they lie so much that galls me, it's the insulting way that they do it...