The Sinclaire Model Of Virtual World Commerce

[Serenity Sinclaire]

Morning, virtual sorts...how's it going? Well, hopefully.

So I was reading HG as I do every morning and read through the recent article here: http://www.hypergridbusiness.com/2015/0 ... o-exports/ and it raised a beef I have had awhile. I posted a response there on the site and then realized it's a month old...so decided to paste it here for your consideration. I'm sure it'll step on a few toes of the thin skinned sorts who are threatened by anything scenting of "change" but Life is dynamic and Change happens.

To those with broader vision, this is for you

My post:

Indeed. I have a proposition for a paradigm shift based on real world value.

The Great Disruption is taking place across the planet and it's throat punching rabid commercialism. Napster started it but now there's micro solutions for everything from hosting to books to music to movies to solar power and even money - with bitcoin. Everything is going the way of Opensource and Free and it's making it harder to make money using the old SL Market model and paradigm. Once people finally figured out how to use Open Sim, SL has tanked and continues to tank...so much so they had to shift their entire focus.

Then there's content.

My biggest gripe for years is that if I pay *real dollars* for a "cartoon" product - whether it's hair, clothes, accessories or a lampshade, then I own that. I own it as much as if I bought a "real" version at Walmart. The only thing I don't do is, if I buy a Sony TV, is run around telling people I made it. Otherwise, it's MINE 100%...I can paint it purple and beat it to death with a sledge hammer if I want to, and virtual content needs to be the same way or it's not going to catch on with mainstream public.

Walmart would go out of business if they imposed restrictions on the stuff they sell. If I buy shoes at Walmart and they tell me I can't travel to Texas wearing those shoes or can't give them to a friend or can't take them when I move, then I quit buying from them. If I buy pretend goods and services with pretend money, then they can impose all the restrictions they want. They own it, not me.

This permission restriction is ridiculous and antiquated and needs to change.Right now I can build anything on that market place and 9 times out of 10 do it better than the original. My lack is in scripting but once I know how my goal is to create freebies galore just to make it harder for these sorts of content creators to make money off these idiot restrictions.

I propose a better option. It is officially termed

The Sinclaire Model of Virtual World Commerce

If you make something with restrictions, then you offer it 100% free of charge. But if you want real money, then make them full permissions and you give up your greedy notions that you can dictate what people can and can't do with stuff they purchased...with the sole exception of being removed as the creator. Update the platform instead to retain the creator's name even if it's been exported offline, and impose a restriction that is OPTIONAL that allows for reselling.

Then you can up the cost to reflect the degree of work involved be it 10 bucks, 20 bucks, even 100 bucks - I've paid 100 bucks for content before, it's not out of the question - and you can offer a reseller program, an affiliate program attached to make a royalty by letting other people sell your stuff for you - where they also make money by doing YOU the favor promoting your wares to more people.

Content Creators act like they're entitled to more than they deserve. If you want my real money then I want my stuff to do with as I please. Otherwise, people like me will come along and create better quality stuff and hand it out free....just to teach you a lesson.

FULL PERMISSIONS = $$$
RESTRICTIONS = FREE

BONUS OPTION: Content creators who produce quality work can instead take a page from the wordpress theme devs and offer store memberships for a few bucks a month, say 5 bucks a month or 125 or whatever annual, and then they get all the clothes or whatever products they want at no other cost...and they get full permissions on it. I'd pay 20 bucks a month easy on a store membership if they offered quality products without restrictions and I'm not the only one. People willing to pay thousands in SL for land will gladly take the "deal of a lifetime" and pay 20 bucks or even 100 a month across several store memberships to not have to worry about all these retarded, outdated restrictions that make the content creators look like snide, uptight, greedy jerks we don't even want to do business with.

Offer me memberships for full perms - offer me an affiliate/reseller option to put your stuff in MY store on MY land (I'm doing you the favor, see), and we both win. I help you get more memberships, I can use the stuff I bought with *real* money any way I like except saying I made it.

Then everybody wins...even the uppity content creators who want more than they deliver.

Heads up, this IS the reason you're not making anything. It's not because OS is a wasteland of copybotters. It's because people want to actually own the stuff they buy and take it wherever and do with it as they please. So they'd rather find full perm freebies than pay you to dictate how the stuff can be used.

Think about supply and demand and the fundamental reason behind why copybots even came into existence.

Greedy content creators wanting to restrict products they got paid real money for. If you got copied, you got exactly what you deserved.

BONUS PROPOSITION TO ILAN AT KITELY - If you guys could work out a solution to add optional store memberships that include built affiliate programs for members of the merchant's store, and if they offer the Sinclaire Model of Virtual World Commerce I guarantee you they'd make a whole lot more money, people would flock to join various affiliate programs and become members...it would also make Kitely Market more profitable as more merchants jumped on board.

For example, build the reseller/affiliate option into the shop platform itself, with the "permission" system so the merchant can set it as *Resell* (i.e. transfer) and take a % off the price charged for the membership or full perm cost. It's automatically deducted at the point of sale and whoever takes it - since all the content has the UUID - can sell copies of the product anywhere in HG, for whatever they want to charge and that % is automatically deducted through the platform and routed to the original creator.

Obviously it requires some "rewiring" but this is not a difficult or impossible solution. Affiliate and merchant affiliate options are all over the web and getting stronger. The advantage virtual content has is the UUID - if you can scrape it off the HG when it's stolen, you can add a function that lets it be resold and send a per centage back to the creator as per the affiliate option. Yeah, it'll take some work but at the end of the day, your own profits margin will more than make up for it, it solves the entire restrictions issue, it allows merchants to make real money again, and it provides real value for consumers who want value and freedom with their purchases.

Or, do it one better and make the marketplace membership driven.

If you guys could make that happen, you'd be the gods of the hypergrid shopping market...and I wouldn't even be sad that you still didn't bring me my world in a browser option yet ;-p

The whole content restriction thing to pacify a few whining sorts are stifling the whole business of commerce.

Things change and this model needs changing...it's WHY people opt for Freebies.

MERCHANTS: Take the challenge. Create your best work and restrict the crap out of it and offer it for free. Then make the same available for $20 full permissions, no restrictions. And present your honest sales/downloads after 3-6 months of active promotion. Watch what happens when you give people a choice to pay for true value over giving away one that's useless for most needs.

Now...unleash the whiners who can't stand freedom of value!

[Isis Ophelia]

I think it is not possible to compare real life goods with virtual goods. Why? because you can not duplicate x-times a dress you bought in Walmarkt and then sell or pass it to any one you want. And then the price. We pay cents for virtual goods. In Kitely Marketplace a bit more (depending of the permissions). True, you can buy an item in a real life store for 1 US$ but it won't live that long that you could travel with it around USA lol

You could purchase, if you wanted, 3d items with full permissions. There are many sites online offering tons of 3d content, where you can buy 3ds, obj, dae and other formats and use them everywhere. Prices for 1 item go from 20 $ to a few 100s US$ depending of the permissions.

But as I said above, because of the nature of 3d content which can be replicated, even though one has paid 79 USD for a hair, for example from this site: http://www.turbosquid.com/3d-models/max ... yle/824170

when you read their rules you find this one:

May I use TurboSquid products in virtual worlds?
Generally, no. While we greatly respect Second Life and related communities, TurboSquid’s artist community does not believe the IP protections for their work are sufficient in these worlds. The specific exclusion in the Royalty Free License is based on the virtual world being open for importing/exporting and the potential for use as a conduit for piracy for TurboSquid models. If a virtual world is more like World of Warcraft or a closed MMO, then that should be allowed. Please check the Royalty Free License for the specific language.

[Serenity Sinclaire]

And that roots out the heart of the issue. If it's not the same as "real" goods then it shouldn't be traded with "real" money.

I realize the old paradigm of SL commerce is ingrained in all the long timers and I acknowledge that the new mesh products offered on the SL marketplace are much, much higher quality and price these days...but the bottom line is that this is an outmoded commerce model and the content creators need to grasp that Disruption is taking place in every industry, including virtual world commerce and "freebie marketing" is gaining ground.

You - in general - can whip up a great model of a space ship and charge 100 bucks all you want but plenty of others will come along, whip up the same thing and hand it out for free, or create tutorials or ebooks or whatever showing exactly how to do it yourself and those people will be the ones making money. You can get all bent out of shape about it and harp and protest but you would be the one failing to recognize straight supply and demand - which drives any economy. People WANT free stuff...quality free stuff. People are more acclimated now a days to buying memberships or package deals and getting lots of quality content for that price. People have grown tired of being nickel and dimed to death or ripped off by greedy creators, or "restricted" by the ones holding all the cards - from currency to movies. So all these disruptive technologies have evolved and all the big corporations who didn't want to adapt lost.

That's why people still rip songs off you tube. You can charge a buck 50 for a 3 minute song but if you put it on you tube, that song can and will be downloaded 100% free. But if you, as an artist offered an option of a membership plan at so and so monthly, your audience would be more inclined to subscribe and pay it. (Though it'll still get ripped if you put it in a video on YT). You're now able to have a guaranteed income so the ripping/copying/pirating stuff isn't driving you out of business.

The POINT being there is a real reason why copy bots and ripping and pirating are happening.

The old commerce model is being disrupted...and you cannot change this. You either adapt to this change or you go out of business.

The other issue being constantly ignored by the content creators is "who's your market, exactly?"

SL/OS creators are making stuff for each other and harping over all these permissions while utterly ignoring the rest of the world population. There's a reason or two why opensim hasn't caught on with mainstream society that's the same reason bitcoin still hasn't caught on. Primarily, it's too convoluted to the average user to deal with when they can hop online and play in a Facebook style virtual environment with a ton of people. Next, because they can make micropayments for whatever assets they're interested in and all the "permissions" nonsense is obscured.

Trying to have a "store" and sell a bunch of assets for micropayments is fine in SL but that model does not work for OpenSim because of the open grids reality...and selling offline...and other 3D marketplaces. And the FACT that sometimes, a neat fireplace with cool smooth animations might be the perfect fit for a great new build but the content creator of the fireplace apparently is so paranoid about not getting credit or making any money - even pennies - they impose no c/m/t on it and it becomes USELESS to anyone but the consumer SLer.

When it becomes USELESS, nobody's going to give you REAL money for fake bs stuff you did. We're not paying for all your hard work and talent. We're paying for a damn fireplace for the new build we're making. This is the problem content creators seem to have in identifying their market. They all seem to have this idea that they're talented enough to make really awesome stuff and therefore should be paid for their talent and on that scale. They make a bunch of accessories and gadgets and then offer them up at the highest price they can get away with and then impose permissions because they're scared somebody might not pay for it*** and it becomes useless.

And here's another reality - as mentioned. I may not be able to copy or modify or transfer YOUR item but that doesn't mean I can't copy it and make my own...then I am the creator, I added scripts that make it do exactly the same as yours, I am your competitor and I hand it out for a bit less or free. You can have all the tantrums you want but I can still take away your business. So permissions don't truly help you in the long run regardless when it comes down to it.

We're beyond the SL walls now and the model needs changing. I provided very sound suggestions. Even Kitely changed it up from where they were earlier to a straight forward membership plan plus micro payments for worlds that are pennies. I think they're more focused on the marketplace than the worlds these days but at least there's still cheap/affordable worlds to move to on the grid here.

If a content creator shifts their paradigm out of the old SL model and employs a membership option, for example, a monthly rate, they'd have a lot more potential to make a lot more money guaranteed every month than relying on the several dozen sporadically buying something for a buck. Would you rather have 12 bucks a month or 240 a month from those same dozen - offering a store membership for 20 a month? If you've got 100 loyal customers you could turn that 100 or 200 bucks a month you're making off them into 2000 a month...if you stopped worrying about the micro assets being "copied" or "stolen" or traded or used in other builds or not getting your name in lights...

You either want to make money with virtual worlds or you don't...and charging for individual items and squawking over permissions and clinging to a model that is losing ground is the fastest way to become obsolete.

Again, if you impose a bunch of restrictions on the content, you can rest assured it LOSES value to the people you're hoping will purchase it. You have to be rational and comprehend that there are a multitude of ideas flowing in people who see your product and think of a cool way to implement it but if they can't make a copy - in case they screw up and ruin it, or can't modify it - in case it's too big or too small, or can't export it in case they want to work offline on it with SOAS or NWS or the like, or can't transfer it in case they wanted to make something cool for a friend, then you can give it away free and nobody's going to mess with it. You can't second guess the end user. You either produce something of value for your MARKET or you lose money and go out of business.

In OS, where everything is free or ridiculously low cost, you can't get away with charging 100 bucks or 50 bucks for anything, even mesh...and while you might make the occasional sale, the only ones actually making money on the marketplace are the ones charging YOU to put up a shop and do transactions every time they make a cut.

You = general, not you specifically. I don't know what you do

[Ilan Tochner]

Hi Serenity,

More than 5% of active Hypergrid users have bought items from Kitely Market, which falls within the 5%-10% of freemium game users (in closed ecosystem games) who buy virtual items. In other words, OpenSim users behave like most types of online freemium game players when it comes to virtual goods acquisition. The average Kitely Market buyer has also spent more then $30 on purchases made in our marketplace so I'm not sure what you're basing your assessments on. OpenSim users buy content from our marketplace despite the availability of pirated content in many websites and OpenSim grids.

[Serenity Sinclaire]

I'm not saying all OS users don't buy.

I'm saying that the SL model is going bye bye and content creators could make a lot more money, consistently, by adapting.

Or don't. It was a suggestion. I see it's basically falling on deaf ears so...so be it.

Delete it if you want. I don't think the core half dozen content creators always being catered to will ever be able to embrace change. But the rest of us will.

[Ilan Tochner]

More than a third of the people who've listed items in Kitely Market have sold at least one item, more than two thirds of which having earned enough money for at least one payout to PayPal. I therefore think our marketplace is actually quite inclusive and offers a way for a lot more than a "core half dozen content creators" to earn money selling content outside of Second Life.

[Isis Ophelia]

Serenity it's a well intended suggestion, but from my experience, I think, not practicable.
It would be doable if merchants were allround-talents. But from what I saw in SL most are hobbysts. It means while they are experts in 1-2 fields, they (me included) are not experienced in other fields and depend on suppliers and their licenses. I wouldn't even think to tell those suppliers they ought to sell their items with no TOS and no licenses. Because it is their talent. If I wanted no restrictions I have the choice to learn such skills too. I need them, they dont need me as it seems they do make enough money for their products, otherwise they would have stop selling.

Since 2006 I have seldom met a merchant who was able to make his own textures, make own templates, own sculpt maps, script the tools he needed for his products, make own animations and now make his own meshes.

Those very sucessful merchants I met in SL were working in teams. Either because they knew the artists in RL or they hired them online to work on those pieces, they could not produce themselves. And this was (is) possible because SL was (maybe still is) a platform with 1000s of customers, a place where some of those sucessful merchants could pay for example for a Classified 600 US or more each week. This high amount for advertising shows me how much money they were (are) making each month.

So actually true freedom can be gained only with items one self controls. You gave us your suggestions, here is mine for you.

Either you spend 2-3 years learning what you still don't know to make your own material. Thats the time I needed as a hobbyst to learn how to make my own textures, my own templates, my own builds and how to work with multi-animations systems. Real life is there too and it needs to be lived. So I still have no idea how to script, how to make sculpts or meshes and depend on the licenses the creators sell or give to me.

Or, you said you are willig to pay 20 US$ monthly. My suggestion how you could get all the items you want with full permissions. In 4 years I have paid around 500 maybe more US$ for the material I have in my computer. 20 dollars each month, that is 240 USD a year. Take that money and go to SL, search for full perms material in the marketplace (there are tons of it) and write to each creator (is how I did it) and ask for his permission or license to export outside of SL.

For your personal use you can take any of the items you've bought with full permissions to any place you want. You still needed to be able to make your own textures to wrap around the items. Myself for example could change clothes 5-10 times a day, build whole regions with plants, buildings etc. As long as I do not pass my material to others, I am fine and do not need to worry about copyrights. So you see freedom is possible for a person who loves to not depend on others.