Why Social Gaming is a Broken Business Model

Social gaming company Zynga used to be a titan. Lately though, the company has been having problems. Most recently Zynga laid off 15 percent of its staff, while still spending millions to acquire other companies. Social gaming is losing out on profits, mostly to mobile gaming, which Zynga is desperate to get into.

Despite the initial momentum, the social part of the business model has become a hindrance to growth. As these games were developed, a more profitable model emerged: in-game actions requiring real-time to complete.