Metaverse Journal is reporting today that large numbers of Linden Labs staff have been laid off.
Since the Linden Labs economy is not declining, but stable at the current time (I need to check these numbers, but according to some initial reports I have read the economic picture of Second Life is stable) this is due to one of several reasons:
1. Preparation for an expected decline in revenue, which does not make sense, since the worst of the "great recession" appears to have been weathered.
2. Preparation for an upcoming sale to a company like Microsoft or Google or Sony which I still think stands a 40% probability of happening withing the next 18 months.
3. A wholesale shutdown of X-Rated content in Second Life, and much tighter security, which may be necessary for it to taken seriously by businesses. If this shock were to happen, Linden Labs could expect a 30% decline in revenue within 3 months, but would hope to offset this in business interest.
There is one more option:
Key investors such as Mitch Kapor, the inventor of Lotus Notes, needs some cash and is forcing a higher pay-out. Since Linden Labs is privately held we will have no idea if this is the reason unless someone spills the beans. The biggest investors are assumed to have seats on the board below and can whatever they so please if they have can get 51% of the share votes.
Board of DirectorsPhilip Rosedale | Founder and Chairman of the Board
Mitch Kapor | Kapor Enterprises, Inc.
Jed Smith | Managing Partner, Catamount Ventures
Bill Gurley | Partner, Benchmark Capital
James Currier | CEO, Ooga
Dana L. Evan | Strategic Finance and Operations Executive
Whatever the point, if these reports are true, get ready for a roller coaster ride ahead.