Electronic Arts (EA) said Tuesday that it has entered a five-year partnership with Facebook that secures the exclusive use of payments system Facebook Credits in games developed by EA or its subsidiary Playfish.
As with social gaming company Zynga and every other third-party developer on the Facebook platform, EA receives a 70% share from Facebook Credits purchases. (By the way, anyone still skeptical about how Facebook itself plans on pulling a profit from its free social network should take a moment to figure out where that other 30% is going.)
EA’s announcement feels a lot like one made back in May, except that one involved a deal between Facebook and Zynga. From yesterday’s release:
Electronic Arts Inc. today announced it has entered into a five-year strategic relationship with Facebook, where more than 200 million people play games every month. The deal will create a simplified, more accessible experience for people who play games and purchase virtual goods on Facebook. Under the terms of the agreement, Facebook Credits will become the exclusive payment method in EA games on Facebook.
And from May 2010:
Facebook and Zynga announced today that they have entered into a five-year strategic relationship that increases their shared commitment to social gaming on Facebook and expands use of Facebook Credits in Zynga's games. The agreement provides a solid foundation for both companies to continue to work together to provide millions of people with a compelling user experience for social games.
In fact, Facebook has similar deals sealed with Crowdstar, RockYou and Disney-owned Playdom. Unfortunately, as the excerpts above indicate, these “strategic relationship” announcements are always scant on details, and even when we reach out to the parties involved, neither Facebook nor the developer will say much more.
The most certain conclusion to be gleaned is that these long-term partnerships all contribute to Facebook's goal to make Credits one of the most widely used payments platforms, usable throughout the massive social network.
If things go well for EA, the gaming company will also benefit from the deal by continuing to have access to Facebook's massive network. Almost half of Facebook’s entire population, 200 of the 500 million, play games on the site, making games the most popular kind of third-party application available on the developer platform.
EA could really use the help. The company recently posted 2Q results that showed a net loss of $201 million in revenue. The same time last year, EA posted a $391 million loss. While EA had already been bracing for the bad news, its executives hope that its new investments in the rapidly growing social gaming space can turn their luck around.
Playfish titles, like Pet Society and Restaurant City, consistently rank in Facebook’s top titles, based on number of daily users.
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RockYou is a leading provider of applications and widgets on the web. RockYou widgets include photo slideshows, glitter text, customized Facebook applications and voicemail accessories that are simple to use and enable people to frequently refresh their online style. Founded in 2006, RockYou has over 35 million users, serving over 180 million widget views per day in more than 200 countries. RockYou applications are customized for easy integration across all social networks including Facebook, MySpace, Bebo, Friendster, Tagged and hi5.Startup/Business
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Playfish is a social games company that creates games for people to play together.
Founded in October 2007 by casual and mobile games veterans and backed by $3M in seed funding, we believe games are more fun when played with friends and family. So we are working on combining the best elements of casual games, social networks, MMOGs and virtual worlds to create entirely new, more social ways of enjoying great games together.
Traditional computer games focus on standalone game play on consoles, your PC or on your mobile. Games that do allow you to play together with others online normally require you to buy the game, go online and try and find like-minded new friends who are also playing the game. This is something that usually only the most dedicated gamers are prepared to do.
Our social games are different. Social games allow you to play together with real-world friends and family using the infrastructure built by social networks. This is in some ways a return to the roots of games. You play with the same people you would play cards, board games or go bowling with in the real world. Sharing the game experience with friends makes it more compelling and fun.
At Playfish we believe social games are a big part of the future of the video games industry, and are working hard to be the leading company in this emerging sector.
Playfish is headquartered in London, UK with offices in Beijing, China and Tromsø, Norway.
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Zynga is the largest social gaming company with 8.5 million daily users and 45 million monthly users. Zynga’s games are available on Facebook, MySpace, Bebo, Hi5, Friendster, Yahoo! and the iPhone, and include Texas Hold’Em Poker, Mafia Wars, YoVille, Vampires, Street Racing, Scramble and Word Twist. The company is funded by Kleiner Perkins Caufield & Byers, IVP, Union Square Ventures, Foundry Group, Avalon Ventures, Pilot Group, Reid Hoffman and Peter Thiel. Zynga is headquartered at the Chip Factory in San Francisco. For more information, please visit www.zynga.com.
