Something isn’t quite right in paradise. Linden Lab has been making a whole series of cuts to staff and programs over the past 6-8 months that are to a large measure a reduction of service and costs associated with the Second Life platform. All the while they are claiming “we are on sound financial footing”. In fact M Linden claimed this last year and Philip is claiming it again this year. The difference however is one of substantial cuts by almost 50% of their staff and a lot of services including technical support and support for various communities within the environment between last year and this.

So who is lying? M and Philip can’t both be right. If M was correct in 2009 then after all these cuts Second Life is definitely in a very solid financial picture at this point in time. It also means that a lot of these cuts to staff and programs were not necessary. If Philip is right however and we are in a good financial position now (compared to then) then we, as a community, were lied to in 2009 which begs the question what else is Linden Lab not telling people.

For example, in the last week Linden Lab has dropped the bomb of closing down the SL Teen Grid in the middle of the school year. 3 days later they just sent an email with 24 hours notice to all community gateway owners that they are shutting down the community gateway program effective immediately.  In both case no substitution was offered for the replacement of the existing service.  In fact the closure of the teen grid, which isn’t that surprising, in the middle of the school year showed remarkable insensitivity to the teachers and educators which have been working all spring and summer to prepare their curriculum only to have the core of that program yanked with 2 weeks to prepare substitute course materials.

I’m sorry as this is not going to be PC BUT —- how dumb do you have to be to think that yanking the teen grid in the middle of the school year is a good idea. (notice that isn’t a question) And we don’t even deal with the teen grid at Rockcliffe. Even I’m mad about this not because it impacts us but because it is a symptom of what Linden Lab has been doing all year long.  That is, making unilateral decisions that impact a very broad community without community input. And driving customers away as a result.

From a strategy stand point this is very bad. One of Second Life’s core assets is the user community. While a good brand can get away with the occasional hit to their reputation, establishing a pattern of behaviour that clearly shows a move away from being customer-centric to being investor-centric is a sure fire way to erode that brand loyalty to the point where any competitive product will drive masses of people away from your core product lines.

Fortunately for Linden Lab there is no such product currently on the market however there are several in development which will be in power positions within the next two years if the Lab doesn’t stop shooting themselves in the foot, stem the bleeding, and start repairing relationships. By the time they are ready to do that it may be too late as OpenSim, Blue Mars, Unity3D and others may have caught up with Second Life at which point it will be game over.

Personally I was really hoping that Philip’s re-introduction as CEO was going to be a sign that calmer heads are ready to prevail. But in continuing these 1980’s MBA-style draconian tactics without involving the community has simply served to erode whatever linguistic capital he had to trade in stepping back up to the plate. In fact, this is exactly the type of thing he should be divorcing himself from as every subsequent announcement of this type drives his personal image away from being the poster boy for 3D collaborative environments.

Anyone new that is brought in to repair all this damage being done is going to have their job cut out for them over the first 2 years of their mandate. Philip was someone who could have repaired that damage in less than half that time and instead he’s just being set-up to look like every other high-paid executive out there which is good for being put in-front of a group of investors but extremely bad if it results in him losing all his identity capital with the customer base supporting Second Life and where it potentially can go. As any business owner can tell you, it’s easy to spend an investor’s money on a business – getting and keeping a loyal customer base is hard and it’s even more difficult if you start with a culture that is ready and willing to walk for a comparable value proposition.

It is an open avenue for any competitive company, like Unity3D, to walk in and pander to the existing client base to say “we care – they don’t”. And people will believe them even if the value proposition isn’t as robust as what Linden Lab can offer simply because the pattern of behaviour established over the last 8 months by Linden Lab has been screaming “we don’t care about you and to prove it we are about to cut another relationship or product or service that is important to the community without offering something better in exchange other than empty promises”.

People are short sighted. In general, long term means “next week” en mass when it comes to decision making and every hole that Linden Lab leaves in their tactical plan is one more hole that leaves their customer based feeling unhappy and unfulfilled. Short of firing their strategists, the Lab should at this point develop a dedicated PAID community strategy group under NDA to knock some sense into them before the community at large just decides that enough is enough and better to move to OpenSim. They may not get everything they want but at least they don’t have to worry about the Lab cutting them off at the knees without compassion, consultation, due warning, and alternative solutions.

Don’t get me wrong – I’m still dedicated to building Rockcliffe up and Second Life is a very large part of that strategic and tactical plan. But that only goes so far. If the Lab continues to alienate the user base all the way to Blue Mars and back then there is no point in staying with a sinking ship. We are nowhere close to that point right now but for the sake of the community I am really hoping that this is the end of the bone-headed manoeuvres that have done nothing but erode Linden Lab’s brand identity and services over the past year.

Somehow I doubt it though. Who knew they had so many shoes.