This may be true but, for me, TechCrunch has gotten to the point where anytime I see one of their headlines I think it's sensationalist linkbait and I'm better off assuming what they're writing is exaggerated or simply not true.
As for the claim, it may be true but I really don't think it matters and this is something that's important for anyone assessing FB as an investment.
Facebook used to own social gaming. Arguably it still does. But it faces a huge threat, one which it hasn't remotely tackled: social gaming--and non-social gaming for that matter--is going mobile in a huge way.
Facebook gaming is built on Flash. As we all well know, Flash is incompatible with iOS and doesn't really suit touch-based interfaces for those platforms that do support Flash (eg use of rollovers and so on). That's not to say that you can't write a mobile-friendly game with Flash but, to date, most people haven't (in my albeit limited experience).
Facebook is, for most people, three things (IMHO): games, photo sharing and chat/messaging. FB's revenue seems built on ads and games. They're acting like they've got the market cornered on games but the don't. As Facebook usage goes mobile (as I believe it increasingly is), the draw of those games goes down and consequently so does the potential revenue.
Sony, Microsoft and Nintendo should already be scared to death of Apple as far as portable gaming goes. I think Facebook should add itself to that list.
Apple will get the market of $3 casual games, but that market does not have a huge overlap with the DS demographic, and where it does, there is less barrier for an iPhone owner to get a DS than there is for a DS owner to get an iPhone -- you can get a used DS for less than a monthly AT&T iphone bill.
Not to mention that the DS is much cheaper than an iPhone, and has multiplayer/networking built in.
Apple is doing fine, and will continue to do so, but they are absolutely not going to unseat the DS any time soon.
[ As a comparison, there have been ~60 million iphones sold, and about 135 million NDS, while iPhone adoption is strong, it has a way to go to just bowl over nintendos foothold. ]
An 8GB iPod Touch is cheaper than the pricing of the 3DS. For completeness we're looking at $249 for a 3DS and $170 for a DSi [1].
What's more a typical new release 3DS game will sell for $30+. Compare that to the typically <$5 for an iOS game. Now you describe those iOS games as "casual" but I see games like Angry Birds that can hold the attention for a long period of time. What's more, you can afford 10-20 of those games per DS game!
Honestly I've never played a DS so I really don't know but are the games really that much better to not feel the heat from Apple? We're talking an order of magnitude difference in game costs and not too dissimilar hardware costs.
[1]: http://www.bestbuy.com/site/Nintendo-DS/Nintendo-DS-Hardware...
The 30% figure can only stand up in an environment without competition. Luckily for Facebook (and Apple), they can create an environment without competition by fiat.
Why would physical goods sellers use an upstart payment platform that takes a 30% transactional cut when there are tons of established financial firms who will do the transactions for 3%-5%?
I mean the fact that they are making this mandatory means that they can't even organically convince vendors who are selling virtual goods on facebook's own platform. Surely this is facebook worship hand waving.
The idea of trusting something less than Paypal is amazing, go Facebook!
If those major developers were told "close a deal because we're willing to mandate using credits" then Facebook deserves to be punished for anti market practices. There is little difference between "hey my OS is popular, let me use it to bootstrap my browser share" and "hey my Social Network is popular, let me use it to bootstrap my payments product".
Facebook simply does not provide enough value after these games are popular to justify a 30% cut. In all honesty, it hardly provides enough value at the beginning. Nothing says social games cannot exist without Facebook at all.
I also question how wide spread this would be. I mean yes it has the potential to be huge but I purposely don't connect my Facebook account to anyone else (no Login with Facebook for me) because of their shoddy history with privacy. Last thing I'm going to do is attach payment info, esp since I don't play any games in the system. I'm not saying this won't be huge, but I am saying it's not going to be ubiquitous.
Agreed, 30% is a ludicrous amount for anything outside of Facebook. Now, if they could offer comparable rates to PayPal, I for one would sign up overnight. Is it that crazy to think that they could topple PayPal's current monopoly on low-end[0] payments?
[0] I couldn't think of a better way to describe it, but if you aren't based in the USA, UK, Australia etc, there aren't a lot of options for getting your first buck for your web app etc.
http://flattr.com? They hail from Sweden, and are quite eurocentric.
"You will not (and you will not enable or allow any third party to) sell Credits to, or trade or otherwise exchange Credits with, any third party."
In short, Facebook Credits cannot be a commodity / currency. They're closer to gift cards, storing value only.
EDIT: Actually, all the major game consoles use "credits" rather than actual dollars for their online transactions. If they can do it for their platforms, Facebook can do something similar for its own platform.
It may seem like a lot, but those users wouldn't be available to you without the platform supporting you.
Whether Facebook intends to go that way or not, people seem to be assuming it will.
I'm not endorsing their currency, just saying they have the muscle power to thrust their virtual currency into the forefront. Its not like I'm saying I want it that way, just that its a realistic scenario.
Where are you GOOGLE ME?! SAVE US!
