Zynga branches out from Facebook to make new 'friends'
Loosens rather than cuts apron strings from Sugar Daddy Zuck
By Kelly Fiveash • In Media • At 14:17 GMT 2nd March 2012
Zynga may not exactly be integral to the survival of Facebook - which recently revealed it derived 12 per cent of its 2011 revenue from the online gaming outfit - but the fact that the company behind Words With Friends has built its own network might make IPO-ready Mark Zuckerberg a bit twitchy.
A "platform for play" has been created by Zynga in an effort to bring its games to a wider audience. What this really means it that the firm doesn't want to just rely on Facebook for its users.
"It's our hope that our Platform partners, and eventually anyone in the industry, can extend the reach of their games and connect to even more players on Zynga.com. Later this year we'll make our platform available for all social game developers through a Zynga API," wrote boss Mark Pincus in a blog post yesterday.
He then tried to sugarcoat the move for Zuck by adding: "In 2007 Facebook changed the game with their courageous move to open their platform to us all.
"We're proud to be a part of Facebook's ecosystem and we built Zynga.com to complement their pervasive social graph. Zynga.com will be one of the first sites completely integrated with Facebook which has become the world’s social dial-tone."
Up until now, Facebook has been essential to Zynga's biz strategy with the company, creaming 93 per cent of its revenue from the dominant social network.
But now it wants to be a destination site, too. Users can log in with their existing Facebook IDs, said Zynga. But the company is clearly keen to see how many people it can attract from outside of Zuckerberg's locked-down silo. In other words, it wants to make new "friends".
Here's what Facebook said in its initial public offering filing to the US Securities and Exchange Commission last month:
Zynga’s apps generate a significant number of pages on which we display ads from other advertisers. If the use of Zynga games on our Platform declines, if Zynga launches games on or migrates games to competing platforms, or if we fail to maintain good relations with Zynga, we may lose Zynga as a significant Platform developer and our financial results may be adversely affected.
Facebook has an agreement with Zynga until May 2015 that states that the social network retains a fee of up to 30 per cent of the face value of user purchases in Zynga's games on its network.
Zynga's decision to exert some independence with its own platform cheered Wall Street. Shares in the gaming company rose 10 per cent to $14.48 on Nasdaq following the announcement. ®