Why Microsoft Is Pursuing Crowdstar for $200 Million

Bloomberg is reporting that Microsoft Corporation is in talks to acquire Crowdstar, the third largest Facebook Application Developer, for $200 million. This follows the recent acquisition of competing social game developer Playfish by Electronic Arts for up to $400 million. The Social Gaming space has been heating up most recently with Zynga expanding their application distribution through a partnership with Microsoft-owned MSN .

One of the most attractive characteristics of Crowdstar, the third largest Facebook Developer, is their user base, hovering around 49 million Monthly Active Users (MAU) , which is comparable in size with Playfish, with less than 600 thousand MAU difference.