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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.

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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:

ebbies_logo.jpgThis 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.

Thanks.jpgGoogle'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.

mafia-wars-wallpaper.jpgZynga 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.

Kids and Games Chart.jpgA 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:

BejeweledBlitz.pngThis 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.

APPNATION-logo.jpgNext 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.

Playspanlogo.jpgYesterday, 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 ZyngaPoker.jpg"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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Casual_connect_seattle_2010.jpgLast 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.

playdomlogo.jpgPrior 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/.

cityofeternals.jpgOhai'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/IJovnwPCcKQ

Next 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:

MTV_Networks.jpgIn 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."

yahoo_logo.jpgThroughout 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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CasualConnect.jpgThis year we're a proud sponsor of Casual Connect Seattle, held July 20-22. Produced by the Casual Games Association, Casual Connect brings together the most talented and knowledgeable experts in the casual gaming field to further the casual games industry with the best of networking and learning. Over 2,000 developers, publishers, and other game industry professionals are expected to attend this year's event.

Members of the hi5 team will be in attendance at Casual Connect Seattle, and available to discuss partnership opportunities with game developers. Come visit us 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 email us at http://developer.hi5.com/php/contact.php to coordinate a time to meet. We hope to see you there!

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Here is a summary of the latest news and highlights in the social gaming industry that took place this week:
 
The week kicked off with an announcement from Social Gaming Network (SGN), game publishers for iOS devices like iPhone and iPad as well as the PC. SGN announced that they had raised $2 million from Tomorrow Ventures and Xing founder Lars Hinrichs. While their focus has primarily been on iOS devices, founder and executive chairman Shervin Pishevar says SGN plans to start releasing titles for Android smartphones.

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According to a new study from Frank N. Magid Associates, American consumers spent $168 million on mobile virtual goods in the last year, and they're expected to do so again in the year ahead. Per the report, over 70 million Americans own smartphones and 45% of those owners play games, while 16% of them are buying in-game goods. The average amount spent? $41 per person! Magid Advisors president Mike Vorhaus weighed in on the results of the study and said, "Everybody knows free-to-play social gaming models on PC platforms have been making a killing but mobile virtual goods aren't as well understood. With almost 20 percent of smartphone gamers already making purchases, there's a lot of room for the market to keep taking off as smartphones continue to increase in popularity."

Wednesday was another big day for funding announcements as well - both HeyZap and PapayaMobile announced funding rounds. Online gaming platform
HeyZap announced the closing of a $3 million round of venture funding led by Union Square Ventures, joined by Naval Ravikant and Chris Dixon for Founder Collective. The company's aim is to make social games more like YouTube videos, so that publishers can embed them on any web page. HeyZap stated that they will be using the funds to grow the company over the next few weeks. Beijing-based PapayaMobile raised $4 million for the launch of its new mobile social networking platform on Android devices. The platform has attracted 3.5 million global users in the past year by launching its own social games on mobile phones. Now it's opening up the platform to third-party developers who can integrate the social platform into their own games.

Boston-based MocoSpace announced the launch of a mobile, browser-based social games platform. The company said it is focusing on games on mobile browsers so that it can reach the widest possible audiences. Rivals include MySpace Mobile, Facebook, Aurora Feint, Ngcomo, Scoreloop, and PapayaMobile.


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It's been a busy week for Playdom, one of the industry's leading social game developers and one of our partners here at hi5. On Tuesday, Playdom closed $33 million in a third round of funding from Bessemer Venture Partners, Steamboat Ventures, and New World Ventures (Playdom has raised $76 million to date). This morning, Playdom announced the acquisition of Hive7.com, a Facebook developer whose biggest game is Knighthood.

Coming up next week, we'll be attending the first-ever Social Developer Summit, hosted by mediabistro.com and All Facebook founder Nick O'Neill. We anticipate that it will be an interesting event for developers, focused on social news, games, discovery, search, and other solutions. Notable speakers include Jason Oberfest of ngmoco:), Luke Rajlich of Zynga's Farmville, John Smart of Zoosk, Jia Shen of Rock You, Arin Sarkissian of Digg, and Immad Akhund of HeyZap. If you're interested in meeting with us at the event, please drop us a line.
 
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Recap of the 2010 E3 Expo Show

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Several hi5 employees were at the E3 Expo this week. This year, a focus on new devices and game sequels have taken center stage at E3. On Monday at a Cirque du Soleil-themed event, Microsoft announced that their camera-based motion-control product, formerly known as Project Natal, is now called Kinect and is expected to release in time for the holidays this year. It's also rumored that Kinect will be bundled with a new slimline model of the Xbox 360. Kinect uses facial and voice recognition functionality to control actions in-game. Microsoft has also confirmed Disney as an official partner on the project, and hinted that the new Star Wars game will use the motion-sensing system. Additionally, other original sports and casual games from will launch later this year and utilize Kinect.

Sony unveiled a new controller for their console as well, the PlayStation Move, which is a wand that allows the player's movements to be tracked by a camera (PlayStation Eye) connected to the console. Essentially, it's Sony's answer to the Microsoft Kinect system and Nintendo's motion-sensitive Wii remote.

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On Tuesday, Nintendo unveiled the 3DS, the first-ever portable 3D gaming system. Additionally, Nintendo has lined up several strong partners to provide content for the gaming system, including EA, Activision, Sega, Ubisoft, Konami and Capcom. Some of the franchises that will be featured on the device in 3D include Madden, FIFA Soccer, The Sims 3, Resident Evil, Batman, and Assassin's Creed.

Fans have been excited by the announcement of upcoming sequels to some highly popular franchises. At a grand event put on by Activision, which included performances by Jane's Addition, Eminem, Usher, and Rihanna, they announced DJ Hero 2, Tony Hawk: SHRED, Guitar Hero: Warrior of Rock, and Call of Duty: Black Ops. Ubisoft announced the upcoming launch of Assassin's Creed: Brotherhood, the sequel to the hit title Assassin's Creed II. 

Overall, the focus of E3 has been primarily on console-based gaming -- as expected for this event based on its history. Companies in the social gaming sector were largely absent from the show. As the mass market for games shifts towards more online, casual and social gaming, it will be interesting to see if this shift is reflected in the companies featuring exhibits and product announcements at future E3 Events. 

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hi5 Featured at UBS Private Company Summit

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hi5 President and CTO, Alex St. John, joined an esteemed panel of speakers at the UBS Internet Private Company Summit at the Four Seasons Silicon Valley today.  The session was focused on social media and gaming, and was moderated by UBS's Executive Director of Equity Research for Internet and Interactive Entertainment, Brian Pitz.

The panel featured some spirited discussion around the evolution of social games, and Facebook's recent platform changes which restrict the ability of games to go viral.  St. John made the observation, "Social games just aren't popular on their own without the Facebook piece.  The game is socializing."  St. John went on to forecast, "Social gaming 2.0 will look more like classic, highly popular titles that include the viral properties that enable them to spread through the social graph."

The other panelists included:
  • Arjun Sethi, Chief Executive Officer, Lolapps
  • Dan Greenberg, Chief Executive Officer, Sharethrough
  • Sean Callahan, Co-Founder, TweetPhoto
  • Mike Peronto, President and CEO, WildTangent
  • Mark Vranesh, Chief Financial Officer, Zynga
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