There have been so many questionable developments in Second Life in the last few months that I am starting to wonder if we are heading straight to a confidence crisis. Such an event could seriously hurt Second Life and Linden Lab.The recent addition of the Value Added Tax (VAT) to the financial burden of our friends from the European Union is only one more nail in what could one day become a coffin for SL. For those who haven't seen this news bit already, the VAT is a tax that many countries apply on consuming. In many, the percentage is around 20%. It now applies to anything Europeans pay to the Lindens.
This will hurt Europeans since it applies on their tier fees. Everybody who runs a business in SL knows that land tiers are the single biggest expense. That's a bit like real-life real estate. It eats up a chunk of revenue. Adding a tax to that will force business owners to consider rising their prices, which would discourage customers from buying, or simply close their shops since their small profits will go away.
Now, this new worry adds itself to a pile or already bothering issues:
- Lag, crashes and the unstable grid;
- Financial scandals involving entities such as Ginko and Allenvest;
- The casino ban, which made a lot of business owners wonder how long other "mature" activities would remain legal;
- Age and ID verification, which could force club and store owners to make tough decisions regarding the Mature flag;
- The sudden "large businesses" turn taken by Linden Lab to attract corporations.
I know I am worried. The reduced access to Second LIfe (when it has technical problems) has a real impact on my own spending, and on my customer's spendings. Many of us who run a business have observed it. If we are to face a confidence crisis for all the reasons stated above, it indicates nothing good for the growth and future of Second Life.
And I hope I am wrong with my worries!