I spoke on an interesting panel today at the San Francisco Chamber of Commerce's 2010 CitySummit event. Moderated by Kara Swisher from the Wall Street Journal and All Things Digital, the topic focused on how the social gaming industry is driving economic growth in the San Francisco Bay Area. Colleen McCreary, Chief People Officer at Zynga, and Roxane Lukas, Senior Human Resources Director at Electronic Arts, joined me on the panel. The discussion touched on how venture capital investment, entrepreneurial experimentation, a uniquely qualified local labor pool and other factors have enabled the rapid emergence of this new industry.
The event was capped with a visit by California Governor Arnold Schwarzenegger, pictured here, who discussed various policy issues, including the state budget and local job creation, with San Francisco Chamber of Commerce President & CEO Steve Falk and Chamber Board Chair Wade Rose. The governor pointed to the internet and gaming sector, as well as green tech, biotech and other California industries, as key to his top priority of job creation for the state.
Separately, hi5 was selected as a finalist for the San Francisco Chamber of Commerce annual Ebbies awards, honoring excellence in San Francisco area business. Winners will be announced on October 28 at the Nob Hill Masonic Center.
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Here are some of the latest news and highlights in the social gaming industry that took place this week:
This week, finalists were announced for the San Francisco Chamber of Commerce 2010 Ebbies award, and hi5 has been nominated for the Emerging Growth Award. The Ebbies is San Francisco's preeminent awards competition honoring excellence in business, and the Emerging Growth Award is given to a San Francisco company that has demonstrated a capacity for creativity and innovation, experienced growth and established itself as a leader in its industry. Winners will be announced at a gala awards presentation and cocktail reception attended by more than 900 business and community leaders on October 28 at the Nob Hill Masonic Center. Additionally, the San Francisco Chamber of Commerce is hosting their annual CitySummit event next Tuesday, August 31 at the PG&E Auditorium. hi5's Vice President of Marketing and Business Development, Mike Trigg, will be speaking on the panel "Electronic Entertainment and Gaming-Based Communications," alongside Laura Fontana of Zynga and Holly Rockwood of Electronic Arts. The panel will be moderated by Kara Swisher of All Things Digital, and will focus on economic resurgence, job growth and "what's next" in the gaming industry. Join us for this can't miss discussion starting at 8:55am on August 31.
Google's Game Developer Advocate, Mark DeLoura, announced on Monday that he officially left Google, just 4 months after joining the company and less than a week after he announced details surrounding Google Web Chrome Store. At GDC Europe, DeLoura announced that Google would only take a 5% revenue share cut from game developers who published their games in the Chrome Store. Over the last few months, Google has made a series of strategic moves that indicate a big push towards gaming - one of those moves being the hiring of Mark DeLoura as their official gaming evangelist, who will likely be replaced soon.
Zynga got into some hot water this week over Mafia Wars with both the city of San Francisco and social game developer Digital Chocolate. Earlier this week, Zynga ran a guerilla campaign to drive interest in a promotional stunt for Mafia Wars. Dozens of fake $25,000 bills were glued to the sidewalk in five locations in Hayes Valley that encouraged passersby to visit a website where they could watch Snoop Dogg blow up an armored truck. City officials were upset with the littering effect of the guerilla marketing campaign. As a result, San Francisco City Attorney Dennis Herrera sent a letter to Zynga threatening a lawsuit unless they pay for the cleanup as well as provide a full proposal to resolve the issue. Additionally, Digital Chocolate sued Zynga this week for allegedly falsely claiming that they created the social game Mafia Wars. Apparently, Digital Chocolate stated that Zynga didn't claim the trademark rights for the game. The game Mafia Wars was first released by Digital Chocolate in 2004, and they believe that they had earned common-law trademark rights by establishing the name for use in business.
A report from M2 Research revealed that kids (ages 8-15) based in the US are influencing almost half of video game purchases, which is estimated to be worth $10.9 billion in software and hardware sales. Additionally, the report shows that 91% of tween boys and 93% of tween girls play games online, and that social networking is increasingly prevalent in children's lives. The NPD Group also released a report this past week, which revealed that 20% of the total US population plays online games on social networks (i.e. social media games). This equates to about 56.8 million Americans. Roughly 10% of these players have spent money for virtual goods in the social media games that they play, and another 11% of players indicated they would likely make a future purchase. NPD analyst Anita Frazier stated: "Although 35 percent of social network gamers are new to gaming, it's clear that a lot of existing gamers have been drawn into the social network gaming arena as well. This impacts both the time they spend with other types of gaming, as well as the amount of money they're spending on gaming. As more players are drawn into these games, the entire games industry is going to feel, and have to adjust to, the impact."
Just a reminder on Tuesday, September 14, hi5 President and CTO Alex St. John will be speaking at the upcoming APPNATION Conference in San Francisco. He'll join the panel "Gamer Nation in the Age of Applications," alongside Mark Skaggs, VP Product Development at Zynga, and Gurbaksh Chahal, Chairman & CEO at gWallet. Wall Street Journal technology reporter Yukari Kane will be moderating the panel. If you're interested in meeting with our team during the conference, please contact us to request a meeting: http://developer.hi5.com/php/contact.php
This week, finalists were announced for the San Francisco Chamber of Commerce 2010 Ebbies award, and hi5 has been nominated for the Emerging Growth Award. The Ebbies is San Francisco's preeminent awards competition honoring excellence in business, and the Emerging Growth Award is given to a San Francisco company that has demonstrated a capacity for creativity and innovation, experienced growth and established itself as a leader in its industry. Winners will be announced at a gala awards presentation and cocktail reception attended by more than 900 business and community leaders on October 28 at the Nob Hill Masonic Center. Additionally, the San Francisco Chamber of Commerce is hosting their annual CitySummit event next Tuesday, August 31 at the PG&E Auditorium. hi5's Vice President of Marketing and Business Development, Mike Trigg, will be speaking on the panel "Electronic Entertainment and Gaming-Based Communications," alongside Laura Fontana of Zynga and Holly Rockwood of Electronic Arts. The panel will be moderated by Kara Swisher of All Things Digital, and will focus on economic resurgence, job growth and "what's next" in the gaming industry. Join us for this can't miss discussion starting at 8:55am on August 31.
Google's Game Developer Advocate, Mark DeLoura, announced on Monday that he officially left Google, just 4 months after joining the company and less than a week after he announced details surrounding Google Web Chrome Store. At GDC Europe, DeLoura announced that Google would only take a 5% revenue share cut from game developers who published their games in the Chrome Store. Over the last few months, Google has made a series of strategic moves that indicate a big push towards gaming - one of those moves being the hiring of Mark DeLoura as their official gaming evangelist, who will likely be replaced soon.
Zynga got into some hot water this week over Mafia Wars with both the city of San Francisco and social game developer Digital Chocolate. Earlier this week, Zynga ran a guerilla campaign to drive interest in a promotional stunt for Mafia Wars. Dozens of fake $25,000 bills were glued to the sidewalk in five locations in Hayes Valley that encouraged passersby to visit a website where they could watch Snoop Dogg blow up an armored truck. City officials were upset with the littering effect of the guerilla marketing campaign. As a result, San Francisco City Attorney Dennis Herrera sent a letter to Zynga threatening a lawsuit unless they pay for the cleanup as well as provide a full proposal to resolve the issue. Additionally, Digital Chocolate sued Zynga this week for allegedly falsely claiming that they created the social game Mafia Wars. Apparently, Digital Chocolate stated that Zynga didn't claim the trademark rights for the game. The game Mafia Wars was first released by Digital Chocolate in 2004, and they believe that they had earned common-law trademark rights by establishing the name for use in business.A report from M2 Research revealed that kids (ages 8-15) based in the US are influencing almost half of video game purchases, which is estimated to be worth $10.9 billion in software and hardware sales. Additionally, the report shows that 91% of tween boys and 93% of tween girls play games online, and that social networking is increasingly prevalent in children's lives. The NPD Group also released a report this past week, which revealed that 20% of the total US population plays online games on social networks (i.e. social media games). This equates to about 56.8 million Americans. Roughly 10% of these players have spent money for virtual goods in the social media games that they play, and another 11% of players indicated they would likely make a future purchase. NPD analyst Anita Frazier stated: "Although 35 percent of social network gamers are new to gaming, it's clear that a lot of existing gamers have been drawn into the social network gaming arena as well. This impacts both the time they spend with other types of gaming, as well as the amount of money they're spending on gaming. As more players are drawn into these games, the entire games industry is going to feel, and have to adjust to, the impact."Just a reminder on Tuesday, September 14, hi5 President and CTO Alex St. John will be speaking at the upcoming APPNATION Conference in San Francisco. He'll join the panel "Gamer Nation in the Age of Applications," alongside Mark Skaggs, VP Product Development at Zynga, and Gurbaksh Chahal, Chairman & CEO at gWallet. Wall Street Journal technology reporter Yukari Kane will be moderating the panel. If you're interested in meeting with our team during the conference, please contact us to request a meeting: http://developer.hi5.com/php/contact.php
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Here are some of the latest news and highlights in the social gaming industry that took place this week:
This week, GDC Europe and Gamescom took place in Cologne, Germany, and while the events have historically been focused on console gaming, there was still considerable discussion about the growth and opportunities within the social gaming market. Casual game development studio PopCap has experienced tremendous success with their social game title, Bejeweled Blitz. In a postmortem session at GDC Europe, PopCap Creative Director Jason Kapalka discussed the somewhat evil side of poorly designed social games, and provided insight into PopCap's golden rules outlined for creating high quality social games. Additionally, our partners Steve Meretzky (VP of Game Design) and Eric Todd (Creative Director) over at Playdom presented an annual recap of the most interesting developments in social gaming. One of the interesting trends they discussed was a down-turn of consumer interest in farming, pet-related, and aquarium-themed social games, while there has been increased interest in city-building, business management SIMs, and sports titles.
Next up in conferences, hi5 President and CTO Alex St. John will be speaking at the upcoming APPNATION: Show Me the Money Conference (hosted at the Moscone center in San Francisco on September 13-14, 2010). APPNATION is focused on providing developers with the tools and tactics to better monetize their apps as well as the platform to showcase their work. On Day 2 of the conference, Alex will join the panel "Gamer Nation in the Age of Applications," alongside Mark Skaggs, VP Product Development at Zynga, and Gurbaksh Chahal, Chairman & CEO at gWallet. Wall Street Journal technology reporter Yukari Kane will be moderating the panel. Join us for this can't miss discussion on Tuesday, September 14, from 10:50am - 11:25am.
Yesterday, PlaySpan announced that they closed $18 million in Series C funding led by Vodafone Ventures and Softbank Bodhi Fund, with existing investors Menlo Ventures, Novel TMT Ventures, STIC, and others participating in the round. PlaySpan provides a virtual goods marketplace and payments for online games and virtual worlds. CEO and co-founder Karl Mehta said that the new funding will be used to expand PlaySpan into Europe and Asia, aiming to capitalize on the growth in Asian gaming markets.
Namco Bandai announced that it has two social game titles in development, and will open up the beta testing of these games to players in late August. City of Football and Treasure Abyss are the names of the two titles currently in development. City of Football enables players to act as a football (soccer) manager, and the game will leverage official data from the English Premier League, Italian Serie A, Liga Espanola, and UEFA Champions League. Treasure Abyss will be a social multiplayer RPG where players plunder dungeons together. Earlier this year, Namco Bandai's VP of sales, marketing and publishing, Olivier Comte, alluded to the fact that Namco was moving outside of traditional boxed retail products when he stated
"So in the mind of the consumer today, to buy a DS or Wii game is to buy a game that isn't very good."
Earlier this week, Zynga announced the expansion of their business into Asia with their first localized social game in Mandarin, Zynga Texas Poker. Facebook users in Taiwan and Hong Kong will be able to play the game, but the game won't be available in mainland China because Facebook is blocked there.
Follow us on Twitter to read more updates from the social gaming forefront!
This week, GDC Europe and Gamescom took place in Cologne, Germany, and while the events have historically been focused on console gaming, there was still considerable discussion about the growth and opportunities within the social gaming market. Casual game development studio PopCap has experienced tremendous success with their social game title, Bejeweled Blitz. In a postmortem session at GDC Europe, PopCap Creative Director Jason Kapalka discussed the somewhat evil side of poorly designed social games, and provided insight into PopCap's golden rules outlined for creating high quality social games. Additionally, our partners Steve Meretzky (VP of Game Design) and Eric Todd (Creative Director) over at Playdom presented an annual recap of the most interesting developments in social gaming. One of the interesting trends they discussed was a down-turn of consumer interest in farming, pet-related, and aquarium-themed social games, while there has been increased interest in city-building, business management SIMs, and sports titles.
Next up in conferences, hi5 President and CTO Alex St. John will be speaking at the upcoming APPNATION: Show Me the Money Conference (hosted at the Moscone center in San Francisco on September 13-14, 2010). APPNATION is focused on providing developers with the tools and tactics to better monetize their apps as well as the platform to showcase their work. On Day 2 of the conference, Alex will join the panel "Gamer Nation in the Age of Applications," alongside Mark Skaggs, VP Product Development at Zynga, and Gurbaksh Chahal, Chairman & CEO at gWallet. Wall Street Journal technology reporter Yukari Kane will be moderating the panel. Join us for this can't miss discussion on Tuesday, September 14, from 10:50am - 11:25am.
Yesterday, PlaySpan announced that they closed $18 million in Series C funding led by Vodafone Ventures and Softbank Bodhi Fund, with existing investors Menlo Ventures, Novel TMT Ventures, STIC, and others participating in the round. PlaySpan provides a virtual goods marketplace and payments for online games and virtual worlds. CEO and co-founder Karl Mehta said that the new funding will be used to expand PlaySpan into Europe and Asia, aiming to capitalize on the growth in Asian gaming markets. Namco Bandai announced that it has two social game titles in development, and will open up the beta testing of these games to players in late August. City of Football and Treasure Abyss are the names of the two titles currently in development. City of Football enables players to act as a football (soccer) manager, and the game will leverage official data from the English Premier League, Italian Serie A, Liga Espanola, and UEFA Champions League. Treasure Abyss will be a social multiplayer RPG where players plunder dungeons together. Earlier this year, Namco Bandai's VP of sales, marketing and publishing, Olivier Comte, alluded to the fact that Namco was moving outside of traditional boxed retail products when he stated
"So in the mind of the consumer today, to buy a DS or Wii game is to buy a game that isn't very good."Earlier this week, Zynga announced the expansion of their business into Asia with their first localized social game in Mandarin, Zynga Texas Poker. Facebook users in Taiwan and Hong Kong will be able to play the game, but the game won't be available in mainland China because Facebook is blocked there.
Follow us on Twitter to read more updates from the social gaming forefront!
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Here are some of the latest news and highlights in the social gaming industry that took place this week:
The San Francisco Business Times today published a story on hi5's transition into the social games industry. Patrick Hoge interviewed hi5 President and CTO Alex St. John last week, discussing the current state of the industry, key players in the space, current challenges that developers face, and the opportunities that hi5 sees. Patrick quotes Alex discussing hi5's approach to building an online social environment centered around games: "St. John said hi5's strategy is to become the 'playground' where people using both real and assumed identities can socialize around games. While not developing its own games, it will use 'addictive' gaming features like 3D avatars in Flash programming, a store for virtual goods and gifting, he said. Last week, for example, hi5 started selling 'prank' gifts in which a user's avatar can be dispatched to do mischief on other users' homepages -- like smashing what appear to be holes in their computer screens with a baseball bat." To read the full article, visit the San Francisco Business Times.
Google has been headlining in the news over the last couple weeks with their recent acquisition of social app developer Slide for a reported $228 million, and rumored developments of a social network for games called Google Me. This week, TechCrunch reported that Google purchased Jambool, creators of the payments platform Social Gold, for $55 million with another $15-$20 million in an earnout. Social Gold enables developers to monetize their social applications through direct payments, and was founded by Amazon veterans Vikas Gupta and Reza Hussein. Additionally, it was reported that Google Ventures, the venture capital arm of Google, supposedly made an estimated $3-5 million investment in popular iPhone games developer ngmoco. The investment reportedly valued ngmoco above $100 million, and this comes on top of a $25 million Series C round ngmoco closed in February this year.
Zynga pulled Farmville from MSN Games portal this week. Just this past February, in the midst of a fairly public battle with Facebook, Zynga announced that is would be bringing Farmville to MSN in an effort to diversify away from Facebook platform. According to figures from AppData, FarmVille has lost more than 20 million users in the past four months since Facebook enacted changes to its app notification system. Although Zynga hasn't yet explained why the game was pulled from MSN, this isn't the first time one of the studio's popular titles has disappeared from a site. Three months ago, it announced the removal of YoVille from teen-targeted social network Tagged. Zynga also announced earlier that they would be partnering with Yahoo! Games, and Farmville is still not available on the portal, so it's unclear if it is still coming to Yahoo! and whether Zynga will continue to bring the title to networks outside Facebook.
eMarketer expects that marketers will spend $220 million worldwide to advertise in social games and social applications in 2010, supposedly increasing 60% in 2011. In the US alone, those numbers total $142 million in 2010, and an estimated $192 in 2011. While the dominant revenue stream for many social games has been the sale of virtual goods, it's clear that there is a lot of opportunity with advertisers as well.
Just a reminder that next week (August 16-18), hi5 representatives will be attending GDC Europe in Cologne. If you're interested in meeting with our team during the conference, please contact us to request a meeting: http://developer.hi5.com/php/contact.php
The San Francisco Business Times today published a story on hi5's transition into the social games industry. Patrick Hoge interviewed hi5 President and CTO Alex St. John last week, discussing the current state of the industry, key players in the space, current challenges that developers face, and the opportunities that hi5 sees. Patrick quotes Alex discussing hi5's approach to building an online social environment centered around games: "St. John said hi5's strategy is to become the 'playground' where people using both real and assumed identities can socialize around games. While not developing its own games, it will use 'addictive' gaming features like 3D avatars in Flash programming, a store for virtual goods and gifting, he said. Last week, for example, hi5 started selling 'prank' gifts in which a user's avatar can be dispatched to do mischief on other users' homepages -- like smashing what appear to be holes in their computer screens with a baseball bat." To read the full article, visit the San Francisco Business Times.Google has been headlining in the news over the last couple weeks with their recent acquisition of social app developer Slide for a reported $228 million, and rumored developments of a social network for games called Google Me. This week, TechCrunch reported that Google purchased Jambool, creators of the payments platform Social Gold, for $55 million with another $15-$20 million in an earnout. Social Gold enables developers to monetize their social applications through direct payments, and was founded by Amazon veterans Vikas Gupta and Reza Hussein. Additionally, it was reported that Google Ventures, the venture capital arm of Google, supposedly made an estimated $3-5 million investment in popular iPhone games developer ngmoco. The investment reportedly valued ngmoco above $100 million, and this comes on top of a $25 million Series C round ngmoco closed in February this year. Zynga pulled Farmville from MSN Games portal this week. Just this past February, in the midst of a fairly public battle with Facebook, Zynga announced that is would be bringing Farmville to MSN in an effort to diversify away from Facebook platform. According to figures from AppData, FarmVille has lost more than 20 million users in the past four months since Facebook enacted changes to its app notification system. Although Zynga hasn't yet explained why the game was pulled from MSN, this isn't the first time one of the studio's popular titles has disappeared from a site. Three months ago, it announced the removal of YoVille from teen-targeted social network Tagged. Zynga also announced earlier that they would be partnering with Yahoo! Games, and Farmville is still not available on the portal, so it's unclear if it is still coming to Yahoo! and whether Zynga will continue to bring the title to networks outside Facebook.
eMarketer expects that marketers will spend $220 million worldwide to advertise in social games and social applications in 2010, supposedly increasing 60% in 2011. In the US alone, those numbers total $142 million in 2010, and an estimated $192 in 2011. While the dominant revenue stream for many social games has been the sale of virtual goods, it's clear that there is a lot of opportunity with advertisers as well.Just a reminder that next week (August 16-18), hi5 representatives will be attending GDC Europe in Cologne. If you're interested in meeting with our team during the conference, please contact us to request a meeting: http://developer.hi5.com/php/contact.php
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Last week, hi5 sponsored Casual Connect Seattle 2010 and hosted an event to celebrate the launch of the hi5 Developer Portal. The developer portal is designed to expedite the deployment and launch of games on hi5.com. On the portal, developers now have access to Virtual Goods and Gifts APIs for hooking into the highly active hi5 gift economy. Additionally, developers can access API documentation (both OpenSocial and Facebook-compatible interfaces) for all integration points, sample source code, and reference guides on promoting and monetizing games on hi5. Developers can also submit their games and applications to hi5 for approval directly from the portal, and manage all their applications on hi5 from one place. Visit http://developer.hi5.com for more information.Leading up to the main event last week, we released a video trailer depicting hi5's President and CTO Alex St. John challenging Facebook to a sumo wrestling smackdown. Representing Facebook at the main event was three-time World Sumo Champion Byamba. The main event was held last Tuesday among a large audience of game industry professionals attending Casual Connect Seattle. While the battle between Alex and Byamba was fierce, hi5 came out victorious as the sumo wrestling champion! To watch the video trailer and footage of the sumo smackdown event, visit:
In addition to our announcement of the hi5 Developer Portal, several other casual game companies made announcements at Casual Connect Seattle, including: Oberon launched a new e-commerce platform for social and casual game distribution called Blaze, GSN and Arkadium partner to create a skill-based version of Facebook app Mahjonn Dimensions, and Offerpal Media launched a new user acquisition and re-engagement solution for social game developers called SocialKast.
Prior to this week's announcement that Disney acquired social game developer (and hi5 partner) Playdom, CEO John Pleasants gave a talk at Casual Connect Seattle 2010 about growing pains in the social game market. Pleasants expressed why scale truly matters, and how success stories on Facebook platform are now concentrating on a fewer number of games gaining a larger portion of the audience. Additionally, he discussed the industry need to design social games that are truly social and engaging. To video video footage of the presentation, visit: http://www.socialtimes.com/2010/07/casual-connect-playdom-ceo-john-pleasants-discusses-social-game-growth-video/.
Ohai's Susan Wu presented on social game design principles at the conference - sharing learnings from Ohai's development of City of Eternals. Some of the key takeaways include: all social games need to have a clearly defined daily loop, women will play MMO games (70% of the most active audience playing City of Eternals were women), and less than 3D graphics can still provide a deep gaming experience. You can view a snippet of Susan's presentation on the hi5 YouTube Channel: http://www.youtube.com/user/hi5networks1#p/a/u/2/IJovnwPCcKQNext up, hi5 representatives will be attending GDC Europe in Cologne (August 16-18). If you're interested in meeting with our team during the conference, please contact us to request a meeting: http://developer.hi5.com/php/contact.php
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Are you ready to rumble?! Alex St. John's war of the words against Facebook has captivated the gaming world, but on Tuesday, July 20, the time for talk will be over as St. John faces off against none other than the Facebook behemoth itself in the sumo wrestling battle of the decade. Come watch the live action in Seattle at this can't-miss event!
Additionally, celebrate the official launch of the hi5 Developer Portal with us at this event. Through this new portal, developers will be able to integrate and publish content on the hi5 platform quickly and easily. Get a sneak preview of the portal in beta here: http://developer.hi5.com
Doors open at 9:00pm, fight begins at 11:00pm. For more information, and to RSVP for this event, visit: http://hi5casualconnect.eventbrite.com/
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Here are some of the latest news and highlights in the social gaming industry that took place this week:
According to a report from VentureBeat last week, Facebook is shuttering its virtual goods store after three years and is focusing on building out its Credits online payments system. hi5's President and CTO, Alex St. John, wrote an opinion piece on this news for Industry Gamers. In this piece, St. John states that Facebook is clearly not dedicated to e-commerce as a result of shutting their own virtual gifts store, so developers should take a harder look at whether Facebook is the right platform to increase audience acquisition and monetize their games and apps. To read the full piece, visit Industry Gamers.
Early in the week, TechCrunch revealed that Google had quietly invested between $100 million to $200 million in FarmVille developer Zynga as part of its preparation to launch a new Google Games platform later this year. Digg founder Kevin Rose and a former Facebook chief technical officer, have suggested in recent weeks that the search-engine giant is working on a social network called Google Me geared toward rivaling Facebook. This social network is intended to build off of Google Buzz, which has been widely criticized by tech pundits.
Offerpal Media announced that they were laying off an unspecified number of staff, in part because it lost out to rival TrialPay in the race to provide alternative payments with Facebook's new virtual currency system, Facebook Credits. Once apps are switched to Facebook Credits, Offerpal will no longer provide offers for those apps. As a result, Offerpal has to lay off its staff and re-focus its resources on growth areas that include providing offers for other game platforms such as the open web, new internet vertical sites, and mobile apps.
On Tuesday, July 20, we will by celebrating the official launch of our new Developer Portal with an event in Seattle. If you're headed to Casual Connect Seattle, we invite you to watch hi5's Alex St. John face off against none other than the Facebook behemoth itself in the sumo wrestling battle of the decade. Come watch the live action at this can't-miss event! Doors open at 9:00pm, fight begins at 11:00pm. For more details on the event, please visit: http://hi5casualconnect.eventbrite.com.
According to a report from VentureBeat last week, Facebook is shuttering its virtual goods store after three years and is focusing on building out its Credits online payments system. hi5's President and CTO, Alex St. John, wrote an opinion piece on this news for Industry Gamers. In this piece, St. John states that Facebook is clearly not dedicated to e-commerce as a result of shutting their own virtual gifts store, so developers should take a harder look at whether Facebook is the right platform to increase audience acquisition and monetize their games and apps. To read the full piece, visit Industry Gamers.
Early in the week, TechCrunch revealed that Google had quietly invested between $100 million to $200 million in FarmVille developer Zynga as part of its preparation to launch a new Google Games platform later this year. Digg founder Kevin Rose and a former Facebook chief technical officer, have suggested in recent weeks that the search-engine giant is working on a social network called Google Me geared toward rivaling Facebook. This social network is intended to build off of Google Buzz, which has been widely criticized by tech pundits.Offerpal Media announced that they were laying off an unspecified number of staff, in part because it lost out to rival TrialPay in the race to provide alternative payments with Facebook's new virtual currency system, Facebook Credits. Once apps are switched to Facebook Credits, Offerpal will no longer provide offers for those apps. As a result, Offerpal has to lay off its staff and re-focus its resources on growth areas that include providing offers for other game platforms such as the open web, new internet vertical sites, and mobile apps.
On Tuesday, July 20, we will by celebrating the official launch of our new Developer Portal with an event in Seattle. If you're headed to Casual Connect Seattle, we invite you to watch hi5's Alex St. John face off against none other than the Facebook behemoth itself in the sumo wrestling battle of the decade. Come watch the live action at this can't-miss event! Doors open at 9:00pm, fight begins at 11:00pm. For more details on the event, please visit: http://hi5casualconnect.eventbrite.com.
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- New Investor, Crosslink Capital, Leads with Participation by Mohr Davidow -
SAN FRANCISCO - July 13, 2010 - hi5, one of the world's most popular social entertainment sites, has closed a new round of venture capital financing of over $14 million. The company's second round of institutional venture financing was led by Crosslink Capital. Jim Feuille, General Partner at Crosslink, will join the hi5 board of directors.
"hi5 is among the companies leading and defining the rapidly emerging social entertainment category, and this round will enable us to fully capitalize on what is already a massive market opportunity," said Bill Gossman, CEO of hi5. "Crosslink has been at the forefront of this revolution with investments in Pandora and Like.com as well as successful public market experience with Omniture and Ancestry.com, so we are thrilled to have Jim's expertise joining the company."
The financing follows an initial venture round of $20 million in July 2007, bringing the total venture capital raised to just over $34 million. The previous round was led by Mohr Davidow, which also participated in the current financing. The new funding will accelerate hi5's expansion into social gaming and virtual goods, which it initiated in December 2008 with the launch of the hi5 Coins virtual currency and virtual gifts store, the hi5 Games channel in February 2009, and hi5 Stars animated avatars in October 2009.
"The social entertainment category is experiencing explosive growth, and hi5 has the global audience, strategic vision and seasoned management team to be a significant long-term leader in this market," said Jim Feuille, General Partner at Crosslink. Feuille serves on the board of Pandora, and played an important role in the transformation of its massive entertainment site. "hi5's unique combination of social game mechanics, ownership of a social graph and a third-party game platform positions the company well for success."
About Crosslink Capital
Founded in 1989, Crosslink Capital is a leading multi-stage technology venture capital and growth equity firm with over $1.4 billion in capital under management. Crosslink was among the first investment firms in the U.S. to integrate public and private technology investing. This strategy allows Crosslink to partner with its portfolio companies on a long-term basis. With more than 20 years behind it, Crosslink Capital has invested in over 90 private equity portfolio companies, including such industry leaders as Ancestry.com (Nasdaq: ACOM), Equinix (Nasdaq: EQIX), BlueArc, Magma Design Automation (Nasdaq: LAVA), Miller Heiman, Pandora and Yipes (acquired by Reliance Communications). For more information on Crosslink, visit http://www.crosslinkcapital.com.
About hi5
Founded in 2003, hi5 today is among the top 20 largest web sites in the world and the leading destination site focused on social entertainment and gaming. Combining a robust social platform with premium content and game mechanics, hi5 delivers a fun, expressive, and interactive entertainment experience to millions of users around the world. Available in over 50 languages, the site features localized games, virtual goods and other content that is monetized through hi5 Coins, a global virtual currency supporting over 60 payment methods and 30 currencies worldwide. For more information on hi5, visit http://www.hi5networks.com.
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Here are some of the latest news and highlights in the social gaming industry that took place this week:
In an article from MSNBC, reporter Rick Aristotle Munarriz says that "social gaming has become the hottest accessory to hit Hollywood since Yorkshire terrier puppies and house-arrest ankle bracelets." It's proven to be true with Viacom's MTV Networks acquiring game developer Social Express. Founded by a pair of former Zynga employees, Social Express expects to release its first casual games for Viacom as soon as this quarter. The deal comes just a week after Disney acquired Tapulous, the company behind Tap Tap Revenge and other rhythmic games.
Playdom, one of our partners here at hi5, continued their ongoing stream of acquisitions with the purchase of Metaplace, a privately held designer of social games, founded in 2006 and based in San Diego. According to David Sobeski, Playdom's chief technology officer, "We expect that the Metaplace social game engine will form a key part of our unified back-end technology platform for Playdom's games going forward."
Throughout the week, there has been a lot of buzz around Yahoo's pending partnership launch with Offerpal Media. Now official, Offerpal Media will power alternative payments for social games within Yahoo's homepage, MyYahoo, Yahoo's Toolbar and Yahoo Pulse. The platform will allow gamers to choose free trials, discounts, promotions or other offers from branded advertisers in exchange for more game play and opportunities.
Also, just a reminder that hi5 is sponsoring Casual Connect Seattle this year, held July 20-22. We invite you to visit our booth #22 at the conference, located in the entrance area of Benaroya Hall on the first floor. Please feel free to swing by and say hello, or contact us to coordinate a time to meet.
In an article from MSNBC, reporter Rick Aristotle Munarriz says that "social gaming has become the hottest accessory to hit Hollywood since Yorkshire terrier puppies and house-arrest ankle bracelets." It's proven to be true with Viacom's MTV Networks acquiring game developer Social Express. Founded by a pair of former Zynga employees, Social Express expects to release its first casual games for Viacom as soon as this quarter. The deal comes just a week after Disney acquired Tapulous, the company behind Tap Tap Revenge and other rhythmic games.Playdom, one of our partners here at hi5, continued their ongoing stream of acquisitions with the purchase of Metaplace, a privately held designer of social games, founded in 2006 and based in San Diego. According to David Sobeski, Playdom's chief technology officer, "We expect that the Metaplace social game engine will form a key part of our unified back-end technology platform for Playdom's games going forward."
Throughout the week, there has been a lot of buzz around Yahoo's pending partnership launch with Offerpal Media. Now official, Offerpal Media will power alternative payments for social games within Yahoo's homepage, MyYahoo, Yahoo's Toolbar and Yahoo Pulse. The platform will allow gamers to choose free trials, discounts, promotions or other offers from branded advertisers in exchange for more game play and opportunities.Also, just a reminder that hi5 is sponsoring Casual Connect Seattle this year, held July 20-22. We invite you to visit our booth #22 at the conference, located in the entrance area of Benaroya Hall on the first floor. Please feel free to swing by and say hello, or contact us to coordinate a time to meet.
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In a meeting with Chris Nuttall of the Financial Times, hi5 president and CTO Alex St. John discussed the evolution and current competitive landscape of the social games industry. As both leading social networks and game developers look to rise above the noise and become the market leader, they will face some big challenges. Alex discussed how commerce will play a significant role in the potential success of social game companies, and was quoted as saying: "The Zynga and Facebook guys are just scratching the most naive edge of online commerce models. The commerce platform that I built at WildTangent and that Big Six has built are decades ahead in sophistication and capability. It's rolling out now and we're going to show the social media industry what it means to really make money from these games."
Additionally, Alex and Chris discussed why hi5 is uniquely positioned to become the leading social gaming platform, and Chris sums up this point best here: "Facebook will make missteps because it wants to be a general-purpose social network and will not focus properly on gaming, leaving it to more specialised companies like his own Hi5 to produce winning models."
Read the full article: http://blogs.ft.com/techblog/2010/07/facebook-will-fail-at-social-gaming-hi5/
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