Venture capitalist and metaverse expert Matthew Ball has a new must-read (and Tolstoy-length) essay on Apple's relationship to the metaverse's future (spoiler: It can totally control it), but this particular passage punched my eyeball:
Roblox’s platform is full of happy users and talented creators. But few of these creators are making money. Although Roblox has $2 billion in revenues, three billion monthly hours of playtime and more than 160 million users, only 29 developers (i.e. companies) netted over $1 million in 2019 and three crossed $10 million. This is bad; more developer revenue means more developer investment and better products. But revenue through Roblox is limited by the company’s paltry payment rates of just 24.5% of every dollar spent on their games, assets, or items. While this makes Apple’s rates 70-85% payout rates seem generous, the reverse is true.
That's much less a split for creators than I inferred from Roblox's IPO filing last year. The fact that Roblox keeps growing suggests most user creators are OK with this revenue split — for instance, teens just starting out and overjoyed to rake a few hundred dollars, and creators more interested in attracting large groups of visitors (such as with this historical sim in Roblox, featured above). Then again, contrast that company/creator split with Second Life:
Second Life users are earning $60 million from Second Life content, while Linden Lab is earning about $65-70 million from Second Life content. In other words: Second Life users are making nearly as much revenue from Second Life as Second Life's actual corporate owner.
Maybe it's just me, but that's amazing and rare near-equity for an Internet-based content creation platform. By contrast, for example, YouTube earned an estimated $9 billion in revenue in 2015, but only paid out $5 billion to content creators/rights-holders.
We could even go further and estimate that Second Life users are probably making more money than Linden Lab's actual staff:
After all, about 200 Linden Lab staff people are specifically working on Second Life, and they earn an average of $100,000 a year. (Executives earning low six figures, low level support staff making maybe $50-75K.) On that view, they take $20 million total from Second Life, while Second Life users take $40 million more.
Then yet again, this also suggests that the virtual world with the fairest revenue split is not necessarily the largest or most successful one.
Wagner James Au / New World Notes 
Leave a comment