Meeting Summary MAB/Baloo Regarding Pricing Changes Reply
Meeting Summary 11-22-2004

On 11/22/04 MAB called an emergency meeting with DAB and Baloo.  With the announcement of developer pricing changes coming out on 12/7/04 and the removal of the first copies. Public out cry in Official Forums prompted MAB_Fall_2004 to call an emergency meeting.  Meeting Minutes

 

 

Copy directly from Connect with MAB Forum

Location: xThor's Frontierzone
Meeting Notes: Chagall
Attending MAB: AllisonChains, amxScott, Celtic, Chagall, DocD, DreamWeaver, Geea, Kally_Lunch, Malika, mrF1x1T, Nep, oli, Uber_Geek, xThor, ZachC
Attending Staff: Baloo
Attending DAB: Gruugor, VirtualVikki
Other Attendees: iota, HugsALot
 

Celtic informed Baloo that the MAB has two major points of concern about the upcoming pricing change, one being the deletion of the first item copy and the other being the pricing changes overall. All of the MAB members have received multiple emails and IMs from members stating their disapproval of the proposal. Some of the messages have gone as far as to say certain designers will boycott and not submit under the new pricing plan.

ZachC asked Baloo where the MAB stands at this point and if Baloo has considered any making any changes.

Chagall wanted to know if the proposal was still negotiable.

Baloo stated that the proposal started internally about a year ago. Baloo has been working on this proposal personally for about 15 months. It began to be presented to the community last December, when some DAB members proposed basing pricing on a resource type model. Around April or May, Baloo started posting more concrete proposals in forums and by June he had opened up discussion in the Economic Studies group. He admits discussion on the topic hasn't gone as quickly as he had planned both internally and community wise, but that it has picked up this last month. The developer repricing is connected to the overall pricing changes of the service which included the change in membership price, the catalog change, and the tbuck conversion rate change.

Baloo said that the concept of resource based pricing is based on how many resources an item takes up. Pixels that move take up more system resources than a static pixel would and therefore should cost a little more. Baloo stated that the pricing has never been consistent in world. Certain items with a small 128x128 texture cost more than other items with a 128x128 texture. He then gave the example of flip-flops versus regular bunny shoes and how they are the same texture size, yet the bunny shoes cost more. Baloo explained that part of the problem with the developer objects was that they were probably priced too low to begin with and also that There hasn't looked at pricing since the 2002 beta. In beta days There had pricing set up to encourage users to buy items like buggies and ramps to test the product. The thinking was if you price the items that you want tested low, people will be more inclined to buy and use them. Now There wants to scale the pricing accordingly. Baloo explained how when the hoverbikes were first introduced they were priced high, mostly as a test to see how much the could get away with charging, and now he believes the price should be adjusted. He compared the resources of a hoverbike as compared to a buggy. A hoverbike is a very light asset, it doesn't touch the ground and has very few moving parts. Whereas a buggy is very resource intensive, it has a huge texture, high polygon count, many vertices, 5 diffy balls. An engineer described a buggy, as far as they system is concerned, as “five avatars holding hands dancing at 60 mph”. There wants to make a lasting scalable pricing plan and the current standards don't work for that. Under the current plan, there are objects that cause a lot of lag that are very cheap and there are objects that cause little lag that are very expensive and this is the opposite of what There wants. One of the goals There has is to use economics and not just rules to address problems like lag and how server load gets used.

Celtic wanted clarification on the resource based pricing. Basically, the larger the item, the more demanding it is on the computer, the more expensive it should be?

Baloo agreed

Nep asked if the decision for changing the pricing was more of a hardware issue than an economic decision.

Baloo stated he has no reports that this change will increase revenue.

Nep pointed out that with how many people have threatened to leave over this issue, this change will probably hurt revenue.

Baloo stated that he has noticed that the conversation has been heading this way in the forums. He stated that he did a study earlier in the day that said the community would have actually saved $9000 in manufacturing fees and submission costs in September and October if this pricing had been adopted. He thinks the basic philosophy of the proposal was that there will be a net change of 0 and/or it would be in the members' favor. The community will be able to buy exactly the same things they bought in September and October for cheaper under the new pricing plan. As far as specialized developers are concerned (IE the developers that create resource intense items) this change will translate into them not making as much money. Overall, this will not hurt the community. On an item by item basis there are some things that will be more expensive and there are some things that will be cheaper, but overall the costs will even out.

ZachC asked for clarification. He asked if everything is pooled together, not specific items? 10 buggies won't be cheaper, but a group of shirts, jackets, buggies, etc. will be cheaper.

Baloo said yes, it will actually be cheaper.

Nep wanted to know why there wasn't a press release, at least for the MAB, so that we would have had time to get feedback from the community. He stated how the MAB is in the dark just as much as the membership is on this topic. Members of the MAB are having to hunt and play catch up on something that we should already know about.

Baloo said that is a fair point, but countered saying that he had a club with over 150 members that was open to the public for nearly 5 months. Developer pricing change was mentioned in the press release about the catalog/exchange rate changes. The final announcement came out this past week about changes that were supposed to be finalized this past Friday. The reason for this push is that There finally has the resources available to put out additional developer templates and before they do that, they need to get pricing straightened out. Baloo said basically, he can put off changing the pricing and releasing the templates until he can communicate these points to the satisfaction of the community (the next window being late January or early February), or he can push the changes. He would prefer to go ahead and push the changes, he knows that if the community isn't in agreement with the pricing changes he will have to put it off. He acknowledges that he cannot introduce new items into the world without first establishing the resource based pricing model.

Celtic stated most members don't participate in economic discussions. To most people's eyes this proposal came out of the blue. He stated the community didn't seem to have a 'heads up' on this issue.

Nep stated that this issue should have been brought to the MAB. That collectively the membership turns to the MAB first and not a subgroup. He thinks that this kind of information should be supplied to the MAB and that we shouldn't have to hunt and research a topic that the community already expects us to know about.

Baloo acknowledged that this issue wasn't handled as well as it could have been handled.

DocD brought up the topic of a 40x40 deck that has a wholesale price of $9880T

Baloo explained currently the only way to get a 40x40 object in world is to use the shop builder 5 specs. The specs for the shop builder 5 are “humongous” and it is the most expensive piece of architecture There has. The user may not be taking advantage of all the Shop Builder 5 specs, but the category for that object, since it is currently being done manually is Shop Builder 5. It is not representative of what he will be paying for that object going forward, that type of deck should be more in the $3000T range.

DocD stated how this member sees auctions of 40x40 glass decks with a wholesale of $2690T and he makes one with grass that has a wholesale of $9880

Baloo said this is one of the reasons why he wants to make these kinds of submission automated with at least a few choices, at least with people knowing beforehand how much these kinds of items will cost them, so they can make smart decisions. He said this is not a problem that is representative of the price changes we are discussing.

Geea had a question about reconsidering the proposal so designers will still get a copy of their designs.

Baloo said the original proposal included a designer's copy (for clarification it's not a free copy it's a first copy). The original proposal factored in approximately how much time it takes for the submitters to process something plus the price of the first copy (this is how There came up with the original price for submissions). This original pricing arrangement is not consistent with today's return policies. It was actually cheaper to submit a design for a hoverbike for $20,000T, than buying it out of the catalog for $26,000T. Baloo went on to explain how this actually wound up hurting There because not only are they losing the catalog sale, but they are also losing the time taken on the submission process. Also with the return pricing, it was possible to make money by submitting items and returning them right away. He said it wasn't something that happened all the time, but it was possible.

Baloo said when he approached the DAB with the proposal, they suggested taking the first copy out to make submissions cheaper and that's what he did. He is open to including the first copy in the submission price.

Baloo acknowledges that the MAB has asked him to tweak the proposal to include the first copy in the submission prices and he has committed to do so.

Geea asked how much that will make proposed submission prices go up.

Baloo said the prices will include both the cost it takes to submit the item plus the cost of the first copy. For the majority of the items it is a small fee for the first copy, but it's difficult for him to go back and say for every $10000Tbuck submission you get a free item, it is not something he can do.

Nep brought up DocD's earlier suggestion of making first copies act like a level up gift where they can not be traded, given away, or sold.

Baloo stated it's not a possibility as the permission are set via the PID. The permissions are on the first copy will be the same as the permission on the rest of the copies

HUGSaLOT pointed out that in Baloo's proposal hoverbikes, which don't take up as many resources as a buggy, still have a higher wholesale than the buggies.

Baloo stated that he is not completely happy with what is on the proposal and is heavily considering changing it.

ZachC asked if Baloo would be open to a compromise on the price of the first item.

Baloo said he would be open to a compromise. He said this problem was never anticipated. He stated that we are working with a one policy fits all. If he were to give the first item at 50% off then it would be possible to submit certain items and have a personal copy for less than what you would pay in the catalog.

ZachC acknowledged Baloo's dilemma, but wanted to point out the designer's dilemma, as well. The designers that he spoke with were willing to “bite the bullet” and pay the higher submission fees, but when they hard that there would be no first item included it was “the straw that broke the camel's back” and a compromise needs to be reached.

Baloo stated that the DAB requested to shift the revenue from the manufacturing side over to the submission side. The request was based on the thinking that in high selling items, if the submission price was high and the wholesale was cheap, the item could be sold for less. However when this last proposal was written it was probably too one sided. Baloo stated that this proposal will cost the community less, it is just a matter of balancing the submission and wholesale costs. Which he will investigate.

DocD stated that there is probably a need to 'reeducate' the designers. The submission cost is specifically to get the item approved and to have the right to resell it inworld, It's not building an item for yourself.

Baloo agreed and said for 98% of the items in the catalog they are correct. They should be able to come up with a submission price that covers the first copy. Unfortunately it's that 2% that is causing a problem because it's a one size fits all program There is working with.

HUGSaLOT asked for clarification on the automated submission process and would that make submission prices cheaper.

Baloo said at the moment the animations and shop builder 5 items are being manually approved and everything else is already automated. After the price change the only submission that will still be manual is the animated items.

Celtic asked if it would be possible to have an official announcement put up in the near future.

Baloo was hoping that this statement, between the discussions in the DAB and economy group, would be a conclusion, but he doesn't want to pre-announce anything before all negotiations are finished. But he will post a statement about this issue.

ZachC stated that he is not comfortable, but he feels better about it now.

Baloo asked for the concerned designers to contact him either via the economy club or email. He stated that now may be the time to take this conversation into the open forums.

The MAB thanked Baloo for meeting with them and they appreciate that he is open to a compromise.