Facebook is focusing on a range of updates to its gaming platform, part of which includes a set of changes announced Thursday, says Facebook's Sean Ryan, director of game partnerships. "We don't worry about them. We worry about us," Ryan says. He cited as a model McDonald's move a couple years ago into coffee, as a "bold effort," while Starbucks "just focused on how to drive its business." The implication being that Facebook is Starbucks. Facebook has been working on a revamp of its app platform for the past year or so to improve distribution for games. After the changes announced yesterday, Facebook will soon be rolling out more new features for game apps, Ryan said in a meeting with reporters Friday at Facebook's Palo Alto, Calif. offices.
As far as Google's pitch to charge game developers on Google+ only 5% on transactions compared to Facebook's 30%, Ryan says revenue is not the main factor for developers. He said users will choose the best platform and developers will choose the one with the most users--currently Facebook has more than 200 million monthly users playing games and 85 games with more than 1 million monthly active users. "At the end of the day, (developers) go where the users are," Ryan says. "We're far and away the leader. It's not even close."
Would Facebook ever come down from the 30% fee? The 30% margin is a traditional industry number, Ryan says, at retail stores like GameStop. "Google's is (at) 5% because it doesn't have any users. It's pretty simple... It doesn't mean (30%) is set in stone. It means we think we deliver a lot of value."
Facebook has a delicate symbiotic relationship with game developers. It exploded in growth with its third party platform and early developers like RockYou and Slide. But in recent years Facebook made changes to its platform to improve user experience which also made developers' businesses more challenging. It clamped down on viral messaging--admittedly with a "blunt instrument" says Facebook's Carl Sjogreen--so that users would not get game spam, but that cut down on game developers' massive growth. Facebook also instituted Facebook Credits, its required virtual currency system for which it takes 30% of all transactions on games. It also has a special deal with Zynga parts of which were revealed in Zynga's recent S-1 filing.
One year ago, spam messages from social games was one of the top five reasons people were unhappy with Facebook, according to polling done by the company. Now it "doesn't even show up anymore," says Ryan. That was a major objective in Facebook's goal of ramping up growth.
Now that the company has solved the spam problem, Facebook is trying to help developers more and give them more ability to reach users. "We should do a better job catering to (developers)," Ryan says.
In the new changes, Facebook has revamped how it surfaces content from games into the News Feed. ("Your friend Joe just gave you a cow! Go thank them now") The game notifications that people will see in their News Feed will be more personalized, using an algorithm based on what games people have played in the past as well as what their friends have played. It also surfaces games based on which games get the most "Likes" and Comments on the News Feed.
People still have the ability to click 'X' next to content that appears in their News Feed that they don't like. Game players on Facebook can also select which friends they want to be able to see their gaming activity on a granular level. Ryan says this will attempt to strike a balance between more distribution for game developers and more content that users want to see.
Another change to Facebook apps is that users can now customize which apps appear on their main Facebook page on the left-hand side. They can select "favorites" that they constantly return to. These favorites will also appear as icons in the top right-hand side of all Facebook apps, so that people can quickly switch between games or apps. Some games also can now appear wider in more of a full-screen mode to enable more complex games.
Another big addition is real-time updates in a new "live ticker' inside of apps. This will give people live updates of their friend's activity in games. It can also do things like publish high scores, achievements and the like. Ryan believes these live updates will drive more game play as friends jump in to challenge their friends.
The real-time updates could also enable a whole new set of real-time games that have mostly not been possible. Up until now most games have been asynchronous like FarmVille where users make a few moves by themselves and their friends respond later. Some developers like Kabam have built their own real-time features for users to see when their friends are online and chat in real time. Now some of that type of functionality is built into the Facebook platform. More such features could be coming soon.
