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April 20, 2009

The SL Economy and the Worldwide Economy

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Jeff Cochran

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Very well… thank you very much!

First Quarter results were released today in the Linden Blog. Highlights of the quarter include:

  • 124 Million User Hours, an increase of 42% from the same quarter last year
  • Peak concurrent users of 88,200, an increase of 33% from the same quarter last year
  • 120M in user-to-user transactions, up 65% from the same quarter last year
  • The Islandmarket has stabilized, although overall square meters of resident owned Land has decreased
  • Gross sales on the Xstreet SL marketplace grew 23% over Q4 of 2008 and 72% over the same quarter last year

Growth numbers of ranging from 23% to 75% are impressive for any business in any economic cycle. The fact that Linden is posting these numbers during this economy is extraordinary, though not unexpected. IMHO, the following factors in the corporate training community are adding wind to SL sails:

Travel Budgets: While there are many elements that drive the SL economy, the fact that travel budgets have been slashed, if not completely eliminated, plays into the hands of SL, which allows companies to continue training sessions and meetings without touching their travel budget.

Small Business: Because there are few (if any) established 800 pound guerillas in SL, small businesses are flourishing. Small businesses are suffering in the US because of the credit crunch. In SL, the barriers to entry are low (other than time spent on the learning curve). The low cost of start-ups means that bank financing is unnecessary, and therefore the credit crunch does not impact as many small business in SL

Free Time: Displaced employees are seeing SL as an opportunity to grow their skills without paying tuition or spending hours and hours in a physical classroom. It would be rare for an employee to be commended for spending time in SL while at work. Now that so many people, unfortunately, out of work, they are less hesitant to tune in and turn on.

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