Linden Lab finally published its figures for Q1 2011 today, or at least those which we get to see. There are some notable absences. Why the figures have been so delayed is a mystery, considering that there is very little text accompanying the charts this time around.
Restructuring seems to have had a positive effect on Linden Lab’s bottom line. As I surmised from its hiring patterns, the Lab is profitable, indeed the Lab is calling Q1 its most successful quarter to-date.
Now let’s take a look at what’s happening, based on what we can see.
Now, the first chart presented is a shameful cheat indeed. The chart shows a huge surge in completed user registrations (AKA signups). This surge starts on 11 April, which is the second quarter and has no place in this report. It’s right at the top, though, and serves as a distraction, colouring the interpretation of the remainder of the data.
I’m sure that it will look great in the Q2 metrics, but for Q1? Signup rates were unremarkable, and showed a slight decline through the quarter.
Here’s what the chart looks like with only Q1 figures included:
Pretty much flat with a slight decline. Still, the results themselves aren’t entirely shabby. Even by the end of the quarter we’re still looking at a figure roughly in excess of 10,000 completed signups per day.
Average monthly repeat logins declined slightly from Q4, falling 1.25% in Q1, while user-hours fell nearly 1% (about one million user-hours for the quarter, or eleven thousand fewer user hours each day).
These declines aren’t huge in percentage terms, but are certainly reflected in the declining user-concurrency through the quarter.
World size also declined, being the second quarter that has done so, dipping by twenty square kilometres, a reduction of about 1%.
On a brighter note, the Second Life economy appears to be healthy with steady (and improving) exchange-rates coupled to an increase in money-supply and trading activity.
The exchange rate rose from 1:258.8 to 1:253.2 (an increase of 5.6 or 2.21%) – which on its own is not necessarily a great indicator. However, coupled with a 3.5% (one million US Dollars) increase in the money supply, and 3.25% increase in Lindex trading volumes (another one million US Dollars), I can only conclude that we’re seeing a reversal of the slight decline in the Second Life economy that we’ve been seeing in previous quarters.
If you wanted to see how the Second Life Marketplace was performing for Q1, you’re out of luck. Those figures have apparently been dropped from the quarterly reports. The trend prior to that looked like it was heading for a plateau, or perhaps it peaked in Q4 and declined. It’s hard to say at this time, but it is certainly tempting to draw conclusions from the cutting of that metric.
I’m particularly looking forward to the figures for Q2. I actually have a good feeling about next quarter’s figures, for the first time in a very long time.
“This surge starts on 11 April”
It occurs to me (because I just watched it yesterday) that Tron: Legacy was released on bluray and other things on April 5th and if I hadn’t already been in SL it would have sent me searching for a VW to jump in to. Rodvik in the blog post above the metrics seems to think the “refreshed and fun registration experience” is the big contributor, well everyone’s entitled to their opinions, I suppose.
Well, the Lab would have metrics for registrations initiated versus registrations completed – so I’m pretty sure they know if they’ve genuinely improved the completion rates. Although, yes, there are some unpredictable external factors.
I think the reasons for omitting SLM are pretty basic. The introduction of the maturity filters did severely impact sales for a good proportion of the quarter. I’d have to check dates but I think they started sometime around mid january and it’s only in the last few weeks that they’ve actually managed to release functionality that should improve sales. They acknowledged the impact on sales in the last office hour I went to – which was either feb or march but they didn’t take any immediate steps in the subsequent weeks to rectify it. So that quarter would have been a write off I’d think.
Wouldn’t it have been much better to show the data, and explain it? Otherwise the message that’s being sent is “if we don’t show you the data, it is because it looks bad.”
This is LL we’re talking about here, remember? Also those reports have been flannel since they first started them. Do you remember the first few? They weren’t even great works of fiction but were pretty good as comedy.
but seriously,
From the perspective of the report’s objectives, I don’t think it does look bad. All they’ve done is tidy the report up and keep it at a high level (because the devil is always in the detail). The marketplace is now just another LL function and they can quite easily say that it doesn’t belong in such a high level report. For example, you’ll notice they don’t differentiate on land type either although mainland and estate land could be considered quite distinct areas both operationally (they run the RCs) and income wise, but that level of detail is at the wrong level for the type of report we now see. Nor do they give us the 60 day login figures anymore, or the sinks and sources.
These reports aren’t even about the key drivers. Signup rates have always been healthy but the retention rate has always been marginally below what could be considered to be the overall industry average and over the last few years appears to have suffered a serious decline. That’s where the focus of LL has been, yet you wouldn’t know it from the report.
All up I see this report as a way of LL attempting to control the conversation. Their objective now solely appears to be providing headline talking points that were picked up by non sl media. It will be successful as those inside SL and don’t pay too much attention to the minutiae and those outside of SL who see the report will take the data and use it (sadly, there’s not a lot of validation undertaken by either old or new media these days) and the rest of us are hamstrung because we don’t have enough data to be able to do more than make some educated guesses and if it weren’t for you and Tyche we wouldn’t even be able to do that with any degree of confidence.
In the end, I don’t think it’s designed to woo investors nor us, it’s just a feel-good story for the gamer media and anyone else who passes by.
meh, I’m pontificating again. Saturdays are not supposed to be serious.
Weird that they omitted Marketplace data yet L$ activity is up. I would’ve thought Marketplace had to be responsible for that. I guess its up in-world then? Good to hear if so.
why bother with these charts, they should just write “YUp, SL is good, we’re doing good, we could show you charts to prove it, but nagh, time is money. Not that we are tight on money, we are profitable, but we aint gonna waist it on producing little graphs when its easy to just tell you that EVERYTHING IS DIDDLY GREAT with the Second life Grid XD”
[...] user registrations: stagnant to a minor decline. Although, as Tateru Nino notes, if you don’t read the graph carefully you’ll miss that they’ve included April in [...]
SL is breathing its last gasps, 90% of worlds/places are EMPTY of people, sex activities are the only full places, and new arrivals are treated like dung by old hands. Add to that the way-out-of-date avatar animations (square behinds! really!), painfully slow rez, and overall difficult to use interface and you have the death rattle in ur ears.
New potential users look at the movie AVATAR to judge animations and have no patience for the embarrassing thingies now cavorting in SL. Too bad to see what was a good thing go sour with crusty age.
Bye bye SL