Has Social Gaming Peaked On Facebook?

Yesterday night while I was upgrading AllFacebook I noticed an interesting trend among some of the top gaming applications: they've been plateauing. While many of the applications have been able to pull off remarkable growth (Farm Town for example), a lot of the large gaming applications have appeared to experience a slow down in what was previously phenomenal growth. Pet Society , the largest game on Facebook which is developed by Playfish, has experienced a flattening usage trend. Traffic has hovered between 10.8 and 10.9 million monthly active users for the past couple weeks. Total monthly active usage among all Playfish applications has declined from around 26.5 million monthly active users to 24 million. Playfish is not the only developer with flattening growth however. Zynga's largest game, Texas HoldEm Poker has appeared to peak at between 12.2 and 12.5 million monthly active users. The Game Is Not Over Granted, the company (Zynga) is supposedly generating around $100 million a year in revenue, approximately one fifth the total estimated revenue of Facebook for 2009. Also Facebook hasn't been updating their statistics as frequently meaning that some of this slow down may simply be a result of Facebook updating their statistics less often. It's also important to note that the business of social gaming is more about building annuities which pay residual income rather than one hit wonders. While the most popular applications tend to grow quickly, they also tend to keep their users coming back. Mob Wars for example, a game which has been on Facebook since the platform launched, continues to attract close to half a million users a day, generating a rumored $1 million a month ongoing for its developer. A Possible Peak But Not A Slowdown In Business Not a bad business right? While there is still room for growth within the social gaming space, the total user base appears to have maxed out at around 30 million monthly users. That means close to 15 percent of Facebook's user base is actively participating in social games. Also of interest is the large percentage of social gaming users that come back on a daily basis. The ratio of daily active users to monthly active users typically hovers around 50 percent for most social games. So what does this apparent peak mean for social gaming companies? Ultimately that the growth is no longer a given for catchy games. Social gaming on Facebook is going to become more competitive as developers compete for the attention of active social gaming users. Do you play social games on Facebook? Do you think this is a seasonal slow down or has social gaming on Facebook finally peaked?

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Has Social Gaming Peaked On Facebook?

Nick O'Neill

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Nick O'Neill