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The gift transaction fee in Sansar is UNACCEPTABLE

Vance Fellini

December 27, 2018 00:17

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Hello, Team Sansar

Your gifting transaction fee is UNACCEPTABLE.

You are effectively acting as a payment processor while CHARGING FIVE TO TEN TIMES THE INDUSTRY STANDARD. I wanted to donate to my friend's Experience. Of the 3085 Sansar Dollars I sent, you taxed me an exorbitant 403 Sansar Dollars. It would make more financial sense to just let my friend add my credit card to their account. THINK ABOUT HOW ABSURD THAT IS.

Imagine buying a $50 gift card in the real world an receiving just $42,50 worth of credit. Who in their right mind would accept that kind of deal? That's effectively what you're offering people who want to support and donate to others' Experiences.

You, as a company, are involved in every step of the financial chain. You control rates at the SandeX Exchange, you control the fees for Experiences, you control the tax on sales and you control the fees for changing Sansar Dollars back into other currencies. You have all the tools and financial control you need to run a business .. yet, for some reason, on top of all that, you also feel the need to tax gifts and donations?!

Imagine being in a store with your friend, giving them $50 to buy something nice, and the store owner coming up to you to merrily snap $7,50 out of your hands before you or your friend have even bought anything. Imagine how outraged and cheated you'd feel.

 

So what kind of clueless idiot approved of doing this in Sansar?

Processing fees and payouts are something you negotiate with your content creators, not your content consumers. As such, I'm refusing to buy any further into Sansar. This is sad for content creators who are creating tons of great things, but I won't support predatory business practices.

I have more than a dozen regions running on your other product, Second Life, and am spending substantial amounts of money every month buying products from the Marketplace and in world, supporting friends financially and donating to different projects. I was hopeful that Sansar might turn into something similar (and it looked that way on my most recent visit), but after seeing your transaction fees, I'm frankly disgusted just thinking of how much money you'd be charging me just to support others after already having paid fees at the exchange.

If you, as a company, don't wise up to what is acceptable business practice and what is not, Sansar does not deserve any modicum of success, and you, as company, do not deserve my money.

Sincerely,
a very pissed off customer

 

19 comments

• 2
  
  Andrew Lawrence December 29, 2018 10:59

  It seems like the people at Linden Lab with the right business mindset are starting to win over the ones who don't have it.  It's just taking a very long time for that to happen in all areas, and the Sansar userbase is going to continue to grow very slowly for as long as that takes.  Your example of giving someone money to buy something is a great example of how flawed the gift transaction fee is, and how it's limiting Sansar's growth.  You're right that it should be enough to tax the currency exchange at both points and the sales revenue from the marketplace.  You're also right to point out how going through the marketplace benefits both buyers and sellers enough that allowing direct transactions to be free offers no practical loophole for the marketplace tax.  They already know from SL that everyone prefers going through the marketplace.  The gift transaction fee is just another way to get money and was never meant to prevent a loophole, and actually prevents people from spending more money on the marketplace.  Taxing direct transactions actually limits the ability to give discretionary refunds, which very easily ruins confidence in the marketplace.

• 2
  
  Gindipple December 29, 2018 17:12

  whitekinight for Linden Lab, ok that's funny.

  and I'm the one flaming huh?

  I'm merely telling you the truth.

  here's another truth

  You pretty much sealed your fate with this line: So what kind of clueless idiot approved of doing this in Sansar?

  yea I'm the childish one, and you're just calling people names, color me confused

   

• 2
  
  Vance Fellini January 01, 2019 14:30

  How about you engage with the arguments instead of attacking me? Coming up with a solution is LL's business, not mine, but that doesn't mean I can't criticise the food just because I'm not a chef. The fact that you stoop to personal attacks leads me to believe that you don't actually have a counterargument against the raised issues.

  The fact of the matter is and remains that when it comes to gifts of Sansar Dollars, Linden Lab is acting purely as a payment processor, without ANY other service or product attached to it. The industry standard for payment processing fees is around 1.5%, not 15%. Gifting Sansar Dollars means getting ripped off, which only results in dissuading users from doing it, which is problematic for something that's supposed to be a social product that thrives on user generated content and user funded communities. 

  How about addressing that rather than committing a tu quoque fallacy? Point out to me where the other 13.5% of value in fees is hiding, instead of snidely demanding I come up with a solution (again, not my business) for a problem you seemingly don't even want to recognise.

  Edited by Vance Fellini January 01, 2019 14:37
• 2
  
  Vance Fellini January 31, 2019 16:09

  Sigh. Nowhere am I saying that Sansar should be completely free. You're either strawmanning or not getting what this is about.

  What this Is about, is that through the entire transaction chain LL is already charging us twice, once when buying Sansar Dollars and once when buying stuff from the Sansar Marketplace. I am COMPLETELY FINE with being charged at those point, because they're services unique to Sansar.

  What I am NOT fine with is being charged yet a third time for a service that is not unique to Sansar and amounts to nothing more than being PayPal for Sansar at 10 times the industry rates.

  When it is literally cheaper to go around Sansar's gift ability and use 3rd party payment processors, SOMETHING IS INCREDIBLY BROKEN. And the kicker is that LL can't prevent people using 3rd party services for gifts anyway, so all they're doing with this tax is reenforcing the notion to go around Sansar's gift mechanics whenever possible because users are financially punished for using it. By attempting to fix a hole in one part of their system (people avoiding purchase tax at the Sansar Marketplace), they've slammed a crater into another (donating money to other users' Experiences and co-running communities in which multiple people are involved with finances).

  LL is essentially demanding a 15% tax to enable donations that don't reveal any personal information such as e-mail addresses or RL names such as is the case with 3rd party payment processors. There literally is no other advantage to using the gift system over something like PayPal. This is idiotic and needs fixing ASAP unless LL really wants to strangle communities and financially disparage Sansar users from supporting their friends. Neither are in the business interests of Sansar because it taxes the long term viability of social projects in something that's supposed to be a social experience.

  Yes, LL obviously needs to charge for Sansar services *somewhere*, but they need to do so where and when it makes sense, not just anywhere they can.

  Do you see the problem yet?

  Edited by Vance Fellini January 31, 2019 16:12
• 1
  
  Gindipple December 29, 2018 00:56

  You haven't thought this through too well. If you can give money away with less taxation than is applied to buying an item then it ruins any and all item transfers in world as it would allow for a loop hole to aquire items with less tax.

  So not gonna change, stay pissed.

   

• 1
  
  Vance Fellini December 29, 2018 05:44

  Gindipple, you're effectively arguing that Linden Lab is incapable of delivering added value with the Sansar Store. That's a bunch of nonsense.

  1) Marketplaces are far more effective for vendors at scale than one-on-one purchases.

  2) I've not bought a single item directly from a creator. I've only used the marketplace, for the above reason. My friend hasn't either, for the same reason.

  3) The marketplace DOES provide added value due to it being a convenient catalogue and having a redelivery button.

  4) Tax CAN be applied when vendors exchange their earnings into another currency to withdraw it from their accounts.

  You are also arguing that the only way for Sansar to get around tax loops, is by charging ten times as much as other payment processors for services that have nothing to do with tax. This argument is nonsensical as well.

  5) I can get around the 15% tax easily by using a third party payment processor.

  6) Vendors can get around the 15% tax just as easily through third parties.

  And lastly, you are arguing that it is fully acceptable that DONATIONS get taxed. You know .. money that's given away with intent purpose of being spent by another person, meaning the Lab will get tax income from it eventually anyway.

  Your loop hole argument doesn't hold up at all. Linden Lab has all the tools it needs to apply tax, even without a transaction fee, because it controls both the entry point and the exit point of all money in the Sansar economy.

  All the transaction fee does is discourage people from supporting other people, and encourage them to use third party service of which Sansar will never see a penny. That's idiotic.

  Edited by Vance Fellini December 29, 2018 21:17
• 1
  
  Gindipple December 29, 2018 06:44

  Well that's all fine and dandy, but you still won't get it.

  Argue more though, just so you can see how futile it is in the end

   

• 1
  
  Andrew Lawrence December 29, 2018 08:22

  It should at least not be in place until it's possible to buy or send something as a gift.  It should also make sure you have enough to pay the fee on top of the amount sent by default, instead of having it taken out of the amount sent.  There should be an option when you pay to have it taken out of the amount sent instead, but it should try to add the fee on top of it by default.

• 1
  
  Vance Fellini December 29, 2018 08:39

  So, Gindipple, you're just here to whitekinight for Linden Lab., rather than to engage with actual arguments. I'd have preferred to get no answer at all instead of your childish attempt at flaming.

  @Andrew: the gifting interface does all that. It shows the calculation of what the other person will get, how much Linden Lab will charge for it, and the grand total you'll end up "paying". The interface isn't the problem. It shouldn't be in place at those rates, period. Anything above industry standard fees for money transfer (+- 1,5%) is exploitative and shouldn't exist, period.

• 1
  
  Vance Fellini December 30, 2018 08:51

  Plain right, Galen? Nonsense. Are you seriously going to defend a 1000% premium over industry standards, on donations of all things, as a solid business strategy? Yeah, seriously... 1000%. How is that not outrageous? 

  Because if so, explain to me exactly what unique service Linden Lab is offering with money transfers that I couldn't do just as good and far cheaper through PayPal or a similar services?

  The answer, of course, is that there is NO discernable difference other than it happening within Sansar's walled garden, and I'm not getting any product in return for it, nor is there anything unique or special enough about Sansar currency gifts to justify the much greater cost compared to alternatives.

  Yeah, obviously Sansar needs to make money, but it need to do so through offering actual added value on its core product, not through an easily avoided tax that only dissuades users from funding projects within Sansar.

  Your, and Gindipple's, literal only argument that "LL needs to make money somehow" is extremely weak to the point of being nonsensical. Sansar's core business is not "donation/gifts". Sansar is not a financial service. If LL cannot make Sansar financially successful through its core business (rent and the marketplace), then it is doomed anyway.

  Edited by Vance Fellini December 30, 2018 08:54
• 1
  
  Vance Fellini January 01, 2019 15:13

  I get the impression you don't even know what I'm talking about. It's this thing:

  

  Imagine having to pay PayPal $15 just to send someone $100. Who would continue to use PayPal?

  FYI, I'm no longer using the gift interface. I'm sending my friend money directly through a third party service because it's way cheaper. If Linden Lab had gone for a 1.5% fee, I might have just kept using the Sansar gift functionality, as there would've been only minimal benefit to using a third party. Instead, Linden Lab got greedy and as a result is receiving no fees at all from me. That is, objectively, a business failure on their part.

  Whatever else they have set up as "virtual world stuff" is entirely irrelevant. Virtual world or not, Linden Lab is still operating within the real world as a business.

  Edited by Vance Fellini January 01, 2019 15:16
• 1
  
  Gindipple January 31, 2019 23:38

  There's actually been a change regarding this. There isn't a tax charge on items now.

  So that sorta invalidates my original reason. I'm not sure of how this changes the tax on gifting money, perhaps it could go away now as they have some new concept in that you can't cash out gifted money apparently.

  Still, I'd avoid calling them idiots to get changes....

  Even I'm not that brazen :)

   

• 0
  
  Vance Fellini December 29, 2018 19:17

  Whatever, Gindipple. I'm ignoring you and your trollish tone policing as you're not actually engaging with the presented arguments.

  @Andrew: do the developers actually check this forum (outside of holidays, obviously), or should I raise the issue at one of these product meetings I've been hearing about?

• 0
  
  Galen December 30, 2018 07:57

  Gindipple may not be the most diplomatic about his responses but he's just plain right here. LL needs to make money somehow. They aren't going to make it from land by giving so many experiences to you for free. I would argue that most content creators in SL pay way more in land fees than LL is asking for transaction fees for Sansar, at least to start. In SL even indie DJs who play at clubs are effectively paying land fees indirectly.

  These fees may be frustrating but they are not outrageous.

  Yes LL sometimes reads this forum. Though you wouldn't necessarily know it sometimes. Yes they are very aware of how frustrating this is. Yes they put a lot of thought into it and did not just oopsie their way into this choice.

• 0
  
  Galen December 31, 2018 18:20

  You sound like you know everything. Enlighten us. What would you do that would be a sure win for a low low price?

• 0
  
  Galen January 01, 2019 14:54

  Purely as a payment processor? Really? You forgetting about that virtual world stuff?

• 0
  
  Gindipple January 02, 2019 00:06

  You can send it one Sandollar at a time and it won't charge you. Unless they plugged that hole

   

• 0
  
  Just Me January 31, 2019 15:13

  Transferring, whether by gift, purchases etc and converting Sansar Dollars IS how Linden Lab make their revenue that pays for the whole party.

  Do they charge you to upload items for use or sell? Do they charge you to host all your 'experiences' or charge when you enter areas? Do they charge you for creating your avatar? These and many more, are more traditional ways of making a revenue stream along with charging for taking currencies out of the 'game'.

  You cannot surely expect this whole thing to be 100% free!

  Try running a cloud deployment with high levels of storage, compute time for building, distribution and management, apply your time to that on a regular basis. Despite the average thought, Cloud deployments are not cheap, nor are they free from regular maintenance... I know because I ran such a system myself, before running out of resources.

  The reality is, this places the costs for running the party on those that utilise inhouse currencies (the user), not the creators or hosts like Second Life.

  Either way you look at Sansar and the proliferation of games/platforms online, they all boil down to one thing, financial return/profit from investment, just like any viable business out there.

• 0
  
  Just Me January 31, 2019 17:35

  It may not be obvious, but the vast majority of us here, all do. What we are trying to explain is, why Sansar charge. You have already stated that this tax can be avoided and you maybe right in demanding a second coat of looking at by LL/Sansar, but demanding that a change take place because you say so, isn't going to make a blind bit of difference, by the reasoning others have posted here.

  Do you see the problem yet?