There has been quite a stir lately especially among Estate owners about Linden Lab's recent reduction in sim and void sim (openspace) pricing.  Outraged Residents claim this change has dropped the value of their land holdings, will make it harder for them to compete against newcomers to the grid, and some even seem to be demanding some kind of recompense.  In my opinion, such Residents are using the wrong metrics. 

The value of our virtual world is what we make of it and that could not be more true than when a Resident rises to become a Concierge or Estate Resident.  In such a role, we are in-effect VARs (Value Added Resellers) to Linden's product offerings.  What we pay Linden Lab in setup and tier fee is for hosting and administration. But it is up to us as land developers, artists, brand builders, and business people, to give our sims a higher perceived value than a generic blank sim.  The VIP Residents of our Saona and March Island-related sims prefer it above any other place they could call home in SL.  Similarly, our good friend Frolic Mills has created an absolute sensation with his Best of SL Boulevard sim commanding an admirable and well-deserved perceived value.

The way to value this as an Estate owner is not how much you paid for it but rather what your cost of sales is as an expense along with all your other costs involved in delivering a total experience to your audience.  For my taste, I love vendors who lower their prices for me.  The more they help me lower my costs, the more I can either expand my profit margin if I so desire, afford to introduce new content, support the works of others, and/or forward the savings to my end-customer.  Sometimes all of the above. It gives me expanded possibilities for the entry-level of our offerings.  And if Linden Lab decides to lower these prices still further or drop tier fees further, I will be delighted not distressed.

Why?  Because I do not inaccurately label the Estate I own as an asset.  Sure it has certain intangible value but you can not measure it as a fixed asset any more than you can your Flickr account or your MySpace page or the virtual host of your website. It is a liability pure and simple.  A cost of doing business against which it is our task to generate sufficient sales revenue.

Our assets are: our name, our brand, our customer base, our standing in the community, the creativity and artistry of the people who help us create the destinations, events, and experiences that are unique to this platform.  And the lower our costs of goods becomes, the higher that grows in importance and perceived value. 

I'm not without my frustrations.  Why we had a double-take on openspace pricing is anyone's guess. The new land store being delayed THE DAY OF the planned opening to "sometime within the next few weeks" frustrates me in ways I'm disappointed to say I have come to expect from Linden Lab.  There is an abundance of things to complain about.

That said, the land re-pricing was a good move and one worthy of support.  It lowers our costs and stimulates new development.  I will always be 100% in favor of anything aimed at accomplishing that.  In fact, I went on record in the official Linden Blog thanking them for the change when it was originally announced.

To all those Estate owners who feel their land is worthless now, you are likely short changing yourself.  Ask yourself this: What makes your sim different from anyone else's?  If your answer is "nothing," maybe you should never have bought a sim in the first place.  In any case, please explain to me: Under what circumstances would it be a good thing for our shared customer base if our Linden Lab cost of sales were to go up?