Linden moves to quell price hike criticism
By Adam Reuters
SECOND LIFE, Oct 30 (Reuters) - Linden Lab Chief Executive Philip Rosedale has admitted a misstep in consulting with select designers and long-time residents before announcing higher fees for buying and maintaining private islands in Second Life, but he argued that the new pricing structure would ultimately benefit the community.
Because existing islands are exempt from the higher fees, some residents expressed concern that the select group of people was given information that might have allowed them to buy up valuable property ahead of the announcement on Sunday.
“We probably made a mistake there, trying to get feedback. We should just tell everybody everything,” Rosedale (right) told Reuters on Monday in a telephone interview that also included newly appointed Chief Financial Officer John Zdanowski.
“You learn more when you can have a brief conversation with a small number of people, but the lesson learned here is, don’t do that — just announce everything completely broadly,” he said.
Rosedale said the Second Life land store was closed on Friday after word of the impending increases leaked, shortly before any developers or other businesses were notified by the company. However, official confirmation of the increases was not given until Sunday evening, which would have presented a small window to buy sims from other residents.
Linden Lab defended the fee increases, saying that they would bring the cost of owning islands more in line with their true value, and would bolster the Second Life community by tilting the balance of development back toward the mainland.
Rosedale noted that island owners could turn a profit solely by exploiting the difference between the monthly cost of an island and the amount of money to be earned by renting it out.
“It’s not a healthy economy if people can just arbitrage without adding value,” he said.
“There is a benefit to the commons of having people stay in the same space — a cool place on the mainland is a public good for the overall society,” Rosedale added. “It’s fine to have an island … but from a rational perspective you should probably pay a little more, because the community loses a little bit when you do that.”
Zdanowski, who was named CFO on Monday, said the price increases were also unrelated to the company’s upcoming server upgrade.
“It happens to be coming at a time when we’re switching from one class of hardware to another, but that’s a coincidence,” he said.
