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    Posted January 30, 2009 by
    This iReport is part of an assignment:
    Stories from Second Life

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    Virtually a Credit Crunch Situation

    CNN asked us ireporters to write about the economy in SL, especially in respect of the ‘credit crunch' and what affect this is having on people spending their money in virtual worlds such as Second Life. As I write for Virtually London (lite) which reports on the SL London sims, I had been interested myself in how people had altered their spending habits, if at all. SL London is a thriving ‘in-world' capital with many virtual and real life businesses using it as a base. Although there are a lot of successful businesses there, I had written an article a few weeks back as I grew increasingly concerned that many business properties and homes for rent still lay empty, http://sllondon.blogspot.com/2008/12/time-to-look-at-sl-economy.html Although I am not linked to the London Team, I think they may have taken note at my suggestions for the sim regarding lowering rents for shops and homes. They put starter shops and homes at a lower rate and are now doing their best to give newcomers a chance to get settled. I am quite amazed though that lots of businesses in SL still push for higher prices when so many people in the real world are losing their jobs and even the small amount of money avatars spend in virtual worlds will probably have to be re-assessed. Although you can survive on free clothes and things in SL, after a while no avatar wants to be seen in free stuff when you see the difference in quality of the clothes for sale. Yes you can make your own things, but part of the joy of SL is shopping, well from a woman's point of view, and some men's as well no doubt. Even with a job in SL, if you walk into a store and there is an outfit you fancy buying, to see the prices in the region of L$600 upwards, puts you right off, and I can shop for England!! but an outfit would have to be very special for me to pay those prices. Yes you will see the odd avatar shopping in those places, but they are never crowded, if they are, it is only people looking and not buying. Some shops however have got it right. There is a shop called BareRose which have kept their prices down whilst producing high quality outfits, buy a dress there for L$150 and you get it in four colours, with all the frills to go with it, for the same money!! BareRose is always packed with people and they are actually buying stuff. BareRose is just an example, another is UK Couture, slightly more expensive for new stuff but you can pick up plenty of bargains there with older stock, which is still very fashionable. My friend Hibiscus Hastings is an expert at finding bargains and she gave me a landmark for a store called Lemania Indigo Designs, where I bought the most amazing evening dress, which included shoes, all for L$250. So there are still quite a few shops around who are using their heads and actually selling stuff. I would imagine that most people pay for their SL accounts with their credit cards and the interest rates on most cards have gone through the roof, so people will be thinking twice about buying Linden dollars. One marked change I have noticed is that most newbies I meet now (and that's a lot,as SL London has become a Gateway where new people first join SL) ask me where they can get an SL job. It seems to be an obsession with them, and of course, jobs are pretty hard to get in the virtual world, well at least until you have been around for a couple of months. As Second Life expands with so many new people coming in lately, you wonder if less people will actually be bringing money into the virtual world, as it's going to be way down on the list of real life expenditure as the credit crunch tightens. Then we have the virtual crunch, can Second Life exist with more avatars joining in droves, but with new people expecting a free ride, and not paying anything back into the system. The figures lately have gone up from approx 60,000 to over 70,000 on line each night. Maybe the Lindens need to lower their tier money as well, so that people can maintain their SL homes and business on the mainland to stimulate the ‘real estate' situation. It will be interesting to see what happens over the next year or so. Barerose http://slurl.com/secondlife/Bare%20Rose/76/20/30 UK Couture http://slurl.com/secondlife/UK%20Couture%20Island/228/130/23 Lemonina indego http://slurl.com/secondlife/S%20Crystal%20Springs/203/159/28
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