Posts Tagged ‘social game’

Casual Games maker Zynga trumps 100 million users on Facebook

Friday, September 4th, 2009

With more than 250 million users, there’s no doubt that Facebook is truly a powerhouse to be reckoned with. With this massive amount of users flowing through the site, cornering the lucrative casual gaming market would be a triumph. While I’m not sure we’re ready to proclaim a flag raising winner, Zynga is clearly leading the charge, and recently announced that they’ve surpassed the 100 million user mark. Doing a quick look at the numbers, that means that almost half of all Facebook members are, or have at one point, used a Zynga built application.

Released on June 19th, Zynga’s current runaway hit FarmVille is primarily responsible for this boost in usership. Just last month, Zynga proclaimed that FarmVille was the “largest and fastest growing social game.” Two points to Zynga for being dead on with this statement. In a new chart published by Inside Social Games, Zynga claimed 4 out of the 10 top spots in most active games on Facebook.

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With over 12 million active daily users, or roughly 5 percent of the entire Facebook population, FarmVille has almost doubled the previous ‘farming’ based app record help by Slashkey’s Farm Town. To this end, one thing is becoming increasingly clear: Farming is big business. As with iPhone apps, previously the hot spot to be was the ‘Mafia’ wars type games. We’ve seen a number of derivations (or, less politely; copies) of this form of play, right through to market saturation. Whether it was consumer complacency, or this market saturation, over the past few months, there’s been a shift away from bullets and bombs to water and seeds.

We could now be on the verge of another ‘derivation’-fest, as Zynga borrowed more than just the name from Slashkey, and likewise, casual games maker Playfish has launched their own farming app titled Country Story. In just under two weeks, Country Story has gone from 1.4 million active monthly users to 4 million. With 9 farming based titles now in the Facebook application store (within the top 109), in total there are 72 million active monthly users on Facebook, or approximately 29 percent.

Zynga is already the current app developer for Facebook, and these new numbers are just another award on the shelf for the firm. If measured by the typical benchmarks used for startups: audience, page views, growth, etc., it’s a fair statement to make that Zynga is an overwhelming success. What’s even more impressive is that the casual/social games maker is managing to do inside Facebook what the company has yet to do itself: be profitable. Remember, Zynga leverages the power of microtransactions to generate revenue, while at the same time allowing users to purchase any number of character customizations. Estimates place Zynga’s annual revenue around $100 million for this year alone, while Facebook’s estimated value is around $500 million. However, as stated above, Facebook isn’t making any money. So when viewed through these glasses, who’s really getting the better deal here?

 

SOE Seattle studio execs ready to Detonate

Monday, August 3rd, 2009

We’ve all heard about an exodus or two from EA, but not so much from Sony Online Entertainment. Well, reset the brain drain clock, as Eurogamer recently spotted a few names missing from SOE’s Seattle studios register.

detonator games logoStudio Director and Executive Producer Matt Wilson, Art Director Corey Dangel, and Producer John Smith officially called it quits at the Pacific Northwest SOE studio at the beginning of July. The trio has struck out on their own with Detonator Games, a new player to the Facebook, MySpace, Bebo (amongst others) social gaming category. From the company’s recently launched site:

Detonator Games takes social game play to new and explosive levels. We build high quality games that unite multiple social platforms in a common goal of fun. We’re totally dedicated to creating entertainment overflowing with the attitude, emotion, and fun that drive players together. In short, we connect people through play.

Wilson and Smith were founding members of the Seattle SOE studio, an original acquisition by Sony of the then titled Fireant. Previously, the team had been involved with Microsoft’s developed, but never brought to market MMO Mythica. In the interview with Eurogamer, Matt Wilson comments, “It’s true that Corey and I no longer work for SOE. This was a very hard decision to make, but it’s the right decision for both us and the project. There were a variety of factors into making this decision, but we wish SOE and The Agency the best success.”

Ah yes, The Agency. This anticipated spy/James Bond –esque title has been in the works since early 2005 at the SOE Seattle studio. There’s even been microtransactions talk surrounding the game. Originally aiming at a 2010 delivery date, some sources in the Seattle gaming community are speculating that the studio will need to regroup, have a think, and perhaps revamp and modify the game, ultimately delaying the launch.

Conversely, SOE comments, “The Agency is not undergoing a reboot of any sorts – that is incorrect. The team in Seattle is still working diligently on this project and we’re looking forward to showing you new content in the future.”

While there are only three guys and one corporate megalith that know the full details of the departure from, foundation of, and the status of The Agency, I believe what we’ve got here is nothing more than a team of entrepreneurs that didn’t want to work for the Man any longer, saw a lucrative market, recognized their skills and knowledge, and went for the opportunity to create something of their own. Detonator Games has been wisely building anticipation of their initial release via a facebook fan page, as well as regular updates on twitter.

Are there already too many social games developers out there at the moment? It really depends on how you look at it. However – how many social gaming companies out there can boast three former SOE execs at the helm? Exactly. We’ve joined the Detonator Games fan page, and will be keeping a close eye on what the folks in the Emerald City have in store for us.

 

Analyzing to find the Sweet Spot in the free-to-play market

Saturday, September 6th, 2008

Osma over at fishpool.com has recently written an outstanding article on finding the ‘sweet spot’ in the free-to-play, pay-for-stuff market.  Writing with expertise gained for his 5 years of experience with Habbo, Osma brings to light some interesting details regarding exactly what players will pay for in the free to play market.

I don’t want to steal any of his thunder, but would rather post some selected highlights.  To read the entire story go and visit fishpool.com.

And now for those juicy highlights:

Providing a basis for the article and why he’s chosen to publish this knowledge:

I’m sharing this with the world because while it’s been an interesting ride to build an online social game with an end-user business model, breaking pretty much every conventional rule in the process (“games have to have objectives”, “there is no profit in micropayments“, and so on), it’s still better for our business if people understand why it works. If this allows a competitor to fix a problem in their product and get off the ground, so be it – there’s plenty of growth to go around here, and failures don’t help anyone.

Looking at two assumptions behind the flexible pricing model:

…the number of customers grows as the cost of goods drops, and second, that the maximum consumption is unrelated to the minimum. There is no average customer who would spend more than half of others, and less than half of the rest.

Applying these principles to the free-to-play, microtransaction marketplace:

Cheap purchase price attracts more customers out of the existing free users, and transactional item-based sales allows repeat purchases of theoretically unlimited amount. Those who are willing to buy more will do so, up to some practical maximum of consumable goods and discretionary spending.

Using the sales of chocolate bars as an example, Osma argues the point effectively:

…how many chocolate bars of standard quality would you expect to sell for $1? How about for $2? More or less than half? How about for $10 for the exact same package? I’d wager chocolate bars sell at least 10x better at the price of $1 than at the price of $10 each, and the increase of customer base more than covers the lower per-unit revenue.

Factoring in packaging and marketing costs to the chocolate bar producer, Osma is quick to point out the obvious differences in a physical, consumable bar of chocolate, and digital entertainment:

…of course there is a minimum profitable price for a bar of chocolate that does not become near-$0 even at very high volumes, unlike purely digital products, so increasing chocolate-sales revenue by dropping prices does not necessarily increase profits, and I’m completely ignoring the effects of packaging and marketing on the perceived value of items. For digital sales, where packaging is more flexible and material costs are effectively non-existent, we still have to consider not-unsubstantial fixed development costs, a certain amount of costs associated to servers and bandwidth, some transaction-related pricing friction, and so forth, but certainly the minimum value (and price) of one unit of digital sales can be driven much lower than a bar of chocolate.

Again, to view the article in full, including some VERY interesting pricing graphs, please go visit fishpool.org.

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