Now that Zynga has finally made the step and gone public, opinions are divided as to whether Facebook as a games platform has peaked and is now on the downslope. Industry expert Tami Baribeau has repeatedly argued that Facebook games are not sustainable as a business model and iOS should be the platform of choice if a developer was to start today. Unlike in the App Store, in the top lists of Facebook games, there are hardly any small bootstrapped companies, Baribeau points out.
She also points to the greater creativity and variety of genres on iOS whereas Facebook games often rely on the same set of mechanics (e.g. energy, gifting, neighboring). The top 20 list is crowded with a lot of ‘Villes’ because city building simulation games have proven most successful, alongside casual point-and-click action titles. In the App Store, games can be discovered through categories and editorial recommendations, whereas Facebook doesn’t offer a game directory.
Distribution – Facebook’s biggest asset or liability?
Naturally, Facebook’s Head of Platform Partnerships Julien Codorniou begs to differ. He argues that social discovery and distribution is Facebook’s great asset and on iOS developers outside the top 20 list have a hard time acquiring new users.
- CityVille by Zynga is the number one game on Facebook. Zynga dominates the platform with 223 million monthly active users.
Wooga’s Jens Begemann even goes so far to say that on Facebook everything is free – including the platform itself and distribution, until a developer is successful enough to sell virtual goods, from which then Facebook takes a 30% share. Also, he notes that unlike on other platforms, everybody can start a Facebook app tomorrow, without asking for approval or paying a fee. It sounds like a nice concept indeed, but in the crowded market and with limited viral channels, distribution is not exactly free. In some cases it might be possible to grow organically, like Wooga repeatedly states to, but the majority of developers are facing a rising costs for user acquisition on Facebook. Also, the most successful one, Zynga, spends more than 40M in Q1 of 2011 on advertising. Many industry experts are expecting more layoffs at social games companies in 2012, because the market is too crowded and costs for user acquisition and production of games are rising.
Philip Reisburger of Bigpoint believes that being outside Facebook is an advantage for his company because Zynga’s audience represents 30-40 percent of the active Facebook population whereas Bigpoint with a similarly large audience doesn’t represent 30-40 percent of internet users. “We’re in a bigger market, we’re not relying on a new guy registering on Facebook – we have over a thousand media partners who drive traffic, so whenever they venture into new ground, it’s beneficial for us,” Reisburger told Gamesindustry.biz.
Facebook’s own Social Graph allows games to move out
- Login with Facebook – play on the web. Casino game publisher Yazino moved away from Facebook’s canvas in November.
Even outside the Facebook canvas, Facebook remains omnipresent. Almost all browser-based games use Facebook Connect to have their application on the open web for full control over their product and revenues without having to pay 30% Facebook tax, while at the same time still being able to benefit from Facebook’s social ecosystem. UK-based casino game developer Yazino moved away from the Facebook canvas in November but the company still leverages the Facebook Social Graph. So is the future of the Facebook game outside the Facebook platform?
A counter example would be King.com. The Swedish casual games developer (founded in 2003) was already a big player on the web before entering Facebook. Their move to publish games on the Facebook canvas came as late as February 2011 and brought them surges in new traffic – currently over 23 million monthly active users. According to Riccardo Zacconi, King.com’s CEO, the company had 300 million games played on its platform per month in December 2010. Now, after the company became a highly successful Facebook publisher 1.4 billion King.com games are played per month.
A dark horse has entered the race
In the platform race, Google+ Games is a dark horse because so far its unclear whether Google+ will be able to attract and retain a mass audience and if that audience is keen on gaming at all. Google is ramping up its games platform and following a different approach than Facebook’s ‘everybody can publish anything’.
- Google Games follows a different approach with preselected and featured games.
Google+ offers a choice of now 33 games that can be browsed in categories such as New games or Top games and also editorial staff picks – something that Facebook deliberately avoids. There appears to be an effort of maintaining a healthy mix in games and genres from Angry Birds to CityVille and Kabam’s story driven Godfather franchise. This might be a reaction to Facebook’s ‘Ville-dominated’ monoculture as well Google’s own Android Market which is often criticized as cluttered and disorganized in comparison to Apples App Store.