hi5 Grows Games and Cash Flow with RockYou "Pets"

-hi5 Logo-hi5 is expanding its gaming section with the addition of RockYou’s Pets game to all of its users. The RockYou Pet game has gained a steady following in its own right, so hi5 is seemingly looking to ramp up the offerings of its own game channel by layering in online activity that is sure to keep users around for extended periods of time, with game titles they already know and trust.

For RockYou, the new partnership means that hi5’s 63 million users will be able to access its gaming products. As one of the major application developers, RockYou has been among the first to create game apps for most of the major platforms, from Facebook to MySpace. So it’s no surprise to see RockYou reaching further with the new partnership with hi5.

What’s notable about this particular partnership between hi5 and RockYou, however, is the monetization capabilities that will be available to both companies as a result. RockYou will exclusively accept hi5 Coins, the virtual currency launched by the social network earlier this year, for payments of the hi5 version of the Pets game. This marks the first time a major social networking site has opened up its payments platform to a large app developer, though this isn’t the first time hi5 has teamed with a game developer for the expansion of its game section. Mochi Media also has games on hi5, and take advantage of hi5 Coins.

Such a payment platform cooperative really grows the potential for both hi5 and RockYou, as the app developer is better able to generate revenue directly from users on hi5’s social network and rely a little less on advertising or other monetization methods. The addition of RockYou to its virtual goods platform in such an integrated manner means that hi5 can further establish itself as a leader in this particular area.

While Facebook and MySpace are looking to virtual goods as alternatives to advertising revenue, hi5 has been rather aggressive in the past few months with its virtual goods initative. The key for hi5 has really been setting up the virtual currency, and creating a marketplace around it. The growth of the marketplace ultimately relies on the end users, but these users will certainly be further enticed with integrated payment options for content that wouldn’t otherwise be available directly through hi5.

It will be interesting to see this trend flourish in the coming year or so, as I think the marketplace approach has a great deal of potential for both developers and platform providers. What do you think of such cooperative projects for establishing a virtual goods marketplace?