The road to hell, it is said, is paved with good intentions. The same might be true of other destinations held akin to hell by individuals and organizations, though it is a matter of debate if these destinations would be considered such by anyone but the traveller. Take Linden Lab and governance for instance. One could argue the point that for the bunch of laid back coders and start-up entrepreneurs that constitute LL’s core, the notion of governance is by its very nature indeed hell. If it is, LL has taken a big step down that road, the biggest to date, and – of course – out of good intentions.
Hell? Governance? Girl, what are you gabbing about?
Well, you will not have missed the fact that, with its New Policy Regarding In-World “Banks”, effective from January 22nd, Linden Lab has decreed what amounts to a total ban of in-world banking activities. This has been hailed, or at least acknowledged as inevitable, by observers as diverse as Benjamin Duranske, Prokofy Neva, Nobody Fugazi, Tateru Nino and Dusan Writer; dissenters have been few and in between, easily dismissed as either obvious lobbyists (for instance Arbitrage Wise, ‘CEO’ of JT Financial) or as missing the point (see Lillie Yifu’s angry retort to Robert Bloomfield’s plea for a continuation of
SL banking activities as a sandbox for RL studies). Not surprisingly, the decision sat far less well with depositors, who, on hearing the news, panically flocked to the ATMs to withdraw their deposits en masse before the impending closure of their ‘bank’ (see Prokofy Neva’s superb on the spot reportage; also the articles on Your2ndPlace and Massively), as well as being accompanied by cries of ‘despotism’ on the comments everywhere. The whole thing simply reeks of RL déjà-vu.
Now I’m not going to discuss the pros and cons of the banking ban, nor of its implementation (try aforementioned Arbitrage Wise on Your2ndPlace, or Aldon Hynes on SLNN, a man also on record for saying it needed Colgate to bring smiling to
SL avatars, for criticism of that). There is little my gut feeling and homebrew reasoning can contribute to what brighter minds have written. Neither am I going to ponder the question what the balance between scammers and little boys playing bank might have been; being neither a lawyer, nor a theologian, I find the degree of inherent malice pretty irrelevant to my opinion of the impact of people’s actions.
What I do find interesting is why Linden Lab felt necessary to step in – and what this means for the future of Second Life as a society, a topic I hold dear since the spectacular failure of my first and only recurrence to in-world policing.
Gwyneth Llevelyn has summarized the three current theories about LL’s motivations. In a nutshell, these are: 1.) LL’s hand was forced by impeding, but undisclosed legal problems, 2.) LL intends to boost the LindeX by choking off all financial activities but their own, 3.) LL does what it says it does, viz . step in to protect residents. You could call these respectively corporate bottom line policy (as put in evidence by the gambling ban, or the age verification scheme), conspiracy of greed, and surprising. Ashcroft Burnham has nicely pointed how unlikely case one is:
It would be very surprising if Linden Lab truthfully cited legal requirement as the reason for the gambling ban, but, although it is in fact compelled by law to prohibit unlicenced banking, it pretended that the reason that it was so prohibiting was to protect its residents from fraud. It would also be odd if Linden Lab, believing itself to be legally obliged to prohibit all banking operations, nonetheless gave the banks a grace period before it closed them down: it did not do that with gambling, either.
As to case two, I’d venture to say you can probably safely dismiss the notion of LL banning banking to assert the LindeX’s supremacy, or install a monopoly, simply because the ban does not encompass financial bodies duly regulated in their RL country of origin. Not that I’m aware of any RL banks actively doing business in-world, but what matters is that the playing field is still open for them, and compared to the Lindens running the LindeX, these are the real thing. Had LL wished to monopolize the financial sector Metaplace style, would they not have banned all banking activities outright? They could have, safe to say without consulting a lawyer, because the world it is to happen in is their sole property. Stating LL can’t ban RL banks from
SL sounds to me a bit like saying businesses can’t ban freelance hotdog vendors from operating in their cafeteria.
Which leaves case three. Unlike Ashcroft, who on concluding this called the measure ‘mundane and un-news/rantworthy’, I think LL acting this way is actually pretty spectacular: it is the first time LL do install a grid wide policy on strictly intra-residential issues without being legally compelled to do so or having a (financial) stake in it.
As such it is a 180 degree turn away from their previous professions of policy on not regulating intra-resident issues and conflicts. The more so since they also throw their VP of Business Affairs’ staunch denial of
SL having an economy overboard along the way. This is not just Philip Rosedale mentioning the ‘economy’ of SL in an interview, this is LL officially acknowledging its existence and the need for its regulation – even if it is only to declare themselves unable to do so but by delegating the responsibility to RL regulators. Which, as both Garret Balaklava and Aldon Hynes have rightly pointed out, is as much an act of governance as instituting a banking codex, or installing in-world financial sector regulators. It just happens to be the one incurring the least cost in terms of permanent administrative effort. But as a step down the road to Linden hell – governance – it is a big one.
LL are in a dilemma. They have created a world so diverse, attractive and powerful that is has gained all the trappings of a society. Societies, however, need some kind of governance, which LL has been historically loath to provide. Maybe so because, as a for-profit company, the only kind of governing body you can be while keeping total control of your business assets is a despotic one. Obviously, as LL has refused to assume this role whenever they could, despotical rule runs counter to what they, CEO first, envision as the nature of Second Life. But sidestepping the question by instituting a policy of near absolute laissez-faire, as they have, proves to be a less and less viable proposition. You might hope that, if you never act as if you were a governing body, people won’t notice that you are. But the price you pay is dearth of governance, which means anarchy, verging on chaos. Too strong a word? Then try abuse reporting for griefing (as I did) – or anything else that needs Linden intervention, and cannot be conveniently deferred to private sim owners. Never mind the mainland, which is under complete Linden control, or rather, in practice, lack of it. As
Second Life society has grown, LL’s non policy has turned from an annoyance into a major failing. The banking ban might very well be the first sign of LL acknowledging that.
Ordinal Malaprop’s pictorial comment might prove to be closer to the truth in historical hindsight than the tongue-in-cheek application suggests. LL’s decision might indeed be a significant step in overturning the rules of an old era, and a first sign of things to come in a new one.
They might have taken the step down that road very reluctantly, but we should still applaud they did, whatever our stance on their reasons may be. And we should start thinking about where we want this to go before they take the next . The days of anarchy are ending. What follows next will be up to us.