This Week’s Headlines on Inside Facebook

IF LogoCheck out the top headlines and insights this week from Inside Facebook— tracking Facebook and the Facebook platform for developers and marketers.

Monday, June 7th, 2010

Tuesday, June 8th, 2010

Wednesday, June 9th, 2010

Thursday, June 10th, 2010

Friday, June 11th, 2010

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Kontagent is a developer of analytics solutions for social application developers.

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Sometrics is a provider of virtual currency monetization solutions for social app and game developers.

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Frima Studio develops social games for big brands.

6waves is an international publisher and developer of gaming applications on the Facebook platform.

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Social Gold powers payments, subscriptions, and virtual economies for online games.

Super Rewards is a monetization solution for applications and games running on social networks like Facebook.

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AdParlor is an advertising network designed specifically for social networking sites.


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SoftLayer provides cloud and dedicated hosting services for social application and game developers.

Social Gaming Roundup: AdParlor, Payments, Ubisoft and More

adParlorAdParlor Releases Whitepaper on Application Installs — A new whitepaper from adParlor (Purchasing Facebook Application Installs) was released early this past week that contains metrics and useful insights regarding Click Through Rates, Conversion Rates, Cost Per Install, as well as interesting facts and quotes from a number of big Facebook developers.

Here’s one interesting quote from Zynga: “Once you’ve acquired the majority of early adopters, CPIs in a particular market can increase by 3-5x from Day 1 CPI!” Another factoid includes the top six factors that influence CPI pricing on Facebook Ads: country targeted, creativity, target market, flow from click to conversion, application saturation, and market conditions, with the last capable of modifying a CPI rate up to 40%.

BilltoMobileDanal Partners with Marquee Names in Online Gaming – eCommerce firm Danal, Inc. is launching the BilltoMobile service for partners across the US, granting their users a means to make online gaming purchases through their mobile phone accounts. Among the partners are Nexon American, NHN, Perfect World, Ntreev, YNK Interactive, Fantage, Cyberstep, Gravity, Three Rings, Global Tongue, KBS World, MMOABC, Onnet, Planet Cazmo, Ray Flame, Thebroth.com, Uforia, Xivio, and Gamepot USA.

Fortumo Launches In-App Payments for Android – Android applications are getting a new way to monetize this week, as mobile payments provider Fortumo launches its own in-app payments for Android developers in Europe, Asia, and the US. Competitors Boku and Zong both launched Android platforms last week.

TickTockUbisoft Announces Digital Game Publishing Business – Former Microsoft game maker Chris Early has become the executive in charge of French developer Ubisoft‘s new digital game publishing business, according to VentureBeat, where he will focus on operating games as an online service, as well as create apps and games for Facebook, the iPhone and other connected platforms. The ultimate goal is to launch these games on the digital platforms in tandem with an intellectual property’s release on the more hardcore gaming systems.

Ubisoft has already been behind at least four Facebook titles we’re aware of, including Vineyard Country, Castle & Co, and TickTock.

SpreadsheetSimulating Application Growth – Here’s a cool new toy from Jon Radoff: as the social market for games is always fluctuating, he has created a cohesive spreadsheet that allows users to dynamically manipulate a number of variables to that will simulate your application’s growth; variables such as the “k-Factor” (essentially how viral it is), average time to spread, and average time a user remains a customer.

[image via Radoff.com]

Mobile Advertisement Threatened on iPhone – Monday, Apple proposed its latest developer terms, which could drastically hinder monetization and consumer experiences on the iPhone. If enforced, these terms would prohibit companies with competing mobile technologies as well as anyone whose primary business is not mobile ads from providing ad services on the Apple device. This includes major players such as Google and AdMob.

Big City LifePlaydom Plans to Localize in Europe – Successful social games developer Playdom is seeking to break into the European market by creating localized renditions of some of its top titles (i.e. Mobsters and new title Big City Life) in French, Italian, German, and Spanish.

Mopay Now Available in Central & South America – Mobile payment provider Mopay is expanding its mobile phone payment platform. The service is adding options to buy virtual goods and services in 18 new countries in both Central and South America, including Brazil, Argentina, Mexico, and Chile.

World CupMySpace Launches World Cup Profile – The World Cup is underway, and now users will be able access the MySpace, World Cup Profile page. From the page, users will be able to view video feeds, watch live games, see real time tweets about the World Cup, and even sign a petition to bring the World Cup to the United States.

Super Rewards Creates “User Feedback Loop” – In the ongoing quest to better monetize advertisements and offers for social game players, Super Rewards has launched a new customization feature dubbed the User Feedback Loop. The new toy will allow players to provide instant feedback one which ad offers interest them the most. Conversely, they can also remove offers just as easily, thus gradually customizing their offer walls to show only their preferred ads.

No Whales Yet in Mobile — But They’re Coming

In our story yesterday about “super whales”, people who spend over $10,000 on social games, we used data from payments company Social Gold, which gathered information from its services on online social networks. But mobile gaming, the second half of the industry, remains for now almost entirely separate from the online business. So after finding out about whales on social networks we naturally wondered about mobile games — do they also have whales?

The short answer: yes, but only if you reduce your expectations of what a whale is. Some iPhone games have attracted players who will spend hundreds of dollars on virtual goods, according to Ron Hirson, the co-founder of mobile payment company Boku.

But Boku’s market, as it exists today, actually prevents larger whales from existing. When players pay via their mobile phone, the charge goes to a mobile carrier like AT&T or Verizon. These carriers, especially in the United States, still consider themselves phone and data providers over anything else — including a mobile bank account for users. So most have caps of under $1,000 for monthly spending, discouraging whales from developing.

“I think it will be a while before whales as defined in the US use mobile as their payment choice, mostly because carriers are just beginning to enable mobile payments and are reticent to enable transaction levels to reach these amounts,” says Hirson. High per-transaction fees are also a problem. “For the ecosystem of mobile payments to thrive, we need lower carrier rates so that merchants/publishers would choose to offer mobile at parity.”

Of course, some games will also allow users to pay with PayPal or credit cards, just as they do online — but for attractions to building mobile games is how easy customers find it to pay with their phone (Boku and competitors like Zong are also integrated into Facebook games for this reason). So for a parallel system of whales to develop in mobile, the carriers will probably have to come around first.

Luckily, Hirson thinks that that it won’t take long for carriers to come around. “US Carriers have already begun to lower their fees,” he tells us. “Verizon announced a 15% fee, down from 30-45%, in recent months. I believe this trend will continue.”

Taking Out the Enemy in Facebook App Mercenaries of War

Mercenaries of WarThink you got what it takes to take out mercs in the ruins of New Georgia? Well, here’s a Facebook role-playing game that might just sate that appetite for destruction: Mercenaries of War from Kaboom Social Games. Except this is not your typical Facebook RPG.

The game takes snippets of action game mechanics and combines them with layers of polish and the more traditional, slow paced elements of an RPG.

As the standard practice goes for the genre, players begin by creating their very own, personal, mercenary soldier (complete with kevlar!). There isn’t a whole lot to customize, but decorating your avatar is not really what makes Mercanaries interesting. After a “retina scan” log in and some words with a somewhat mouthy general of sorts, players start off in their mission: To save some rich guy’s daughter.

Action FeaturesOkay, okay, so the storyline is a bit cliché. Players begin with your typical list of missions that can be done at the cost of energy. Immediately, for us, Mercenaries stood out, as the first mission was to take out some guards. Surprisingly, clicking “Do Task” doesn’t automatically do the task, but rather, it takes the player to a mini-game in which they literally have to shoot the guards that are walking about. To add a little bit of challenge, there is a time limit and only so much ammunition. Of course, it’s still not too hard.

Granted, it doesn’t look as good as an action game, and the guards move like cardboard cutouts, but it was certainly different, fun, and memorable. Unfortunately, we’ve run out of energy for the day, so we’ve yet to run into other mini-games of this type, but here’s hoping there are more.

As for the regular missions, these are a bit more familiar. Players use energy to do missions pertaining to the story, earn items, and repeat the task until it is at 100% completion. Now, normally, RPGs make this 100% completion element optional, but in Mercenaries it is actually required to unlock the next task. It’s not all that noticeable, however, because each mission comes with a window that actually shows the player “doing” the task. Moreover, many of the tasks are justifiable for being “repeated” by sheer logic.

Doing TasksYou see, in many cases, users aren’t “repeating” the task from the game’s perspective. As an example, an early mission has you searching for something in a darkened warehouse. Each time you redo the task, a flashlight moves through the room a little bit. Whatever it comes to rest on, be they health packs, guns, vests, etc, will be the reward for doing the mission. Players will repeat this process until 100% completion is reached and the item in question is found (at 100%).

Of course, while many of the missions are justified, just as many feel awkward to repeat. Okay, trying to figure out a passcode is going to take a number of tries, but why would one have to try to turn on a generator two-dozen times? Anyways, once you have finished all available missions, users can return to an overworld map of New Georgia and move to a new, unlocked area.

As a matter of fact, this is where the classic social mechanic of battling comes into play. In each area, there are “competing mercenaries” (other players), trying to find Mr. Big Wig’s daughter as well, so it’s up to you to take them out. Expectantly, this uses up stamina, but rather than go to a completely new page that is an unimmersive list of users your level, you change the “view” of the map to a sort of infrared view that shows who you can pick a fight with, within the buildings on the map, and how many mercs (more on them in a second) they have with them.

BattleBattles play out passively based on statistics such as attack and defense. Each player will trade blows until one of them is down for the count. It truth, it is no different than watching two static avatars go at it with numbers popping up overhead – ala other Facebook RPGs – but it feels a little different as each user and their team is lined up Final Fantasy style inside whatever building the engagement was begun, and reacts to the amount of damage they take. Also, as players battle, they build up “Adrenaline,” that, once full, can be used to significantly boost our battle capabilities (i.e. damage) for particularly tough opponents.

Regarding the mercs that make up a player’s team, these are purchased from the market and do not appear to be players. These are actually purchased with a virtual currency called “Merc Points.” However, weak ones can be bought for a little in-game cash, strong ones for a lot of in-game cash, and others earned through inviting friends to “Join Your Squad.” Additionally, they can also be modified with equipment like your avatar can, as well as be heal after each battle (and med packs are plentiful when you do regular missions).

The Merc Points, oddly enough, is where a big usability complaint comes into play. You see, each level you earn, earns you one Merc Point, so it is entirely possible to earn some extremely powerful (and sometimes limited edition) mercenaries without having to pay any real money. However, when you run out of energy or stamina doing missions or battling, a popup asks you to refill. If you click it, it refills, but pulls your Merc Points to do so. Not once is there a confirmation window asking if the player wants to spend those points. The popup itself doesn’t even say that it will cost Merc Points. If you’ve ever traveled to a location where people give tourists “free” gifts then tell you it costs money; it’s about as annoying as that.

Ninja MercOther than that, the only other game play issue is that the typical “land” one can buy in an RPG to earn periodic income is a bit pricey for new players. Usually, these investments have some smaller purchases that new users can buy to get started, but the cheapest here is around 25,000+.

Outside of game play, Mercenaries also brings up one concern, and that is how well the average Facebook user will enjoy the action elements. For those who have played many traditional, console games, such an mechanic is appreciated — but social gamers don’t consider themselves “gamers,” so it may scare some off. Anyway, these modes are very few and far between. Additionally, the app has been growing rapidly in recent time, and is already north of 4,600 monthly active users. Perhaps, social gamers are coming to terms with what they claim not to be.

Overall, Mercenaries of War is a wonderful role-playing game with very little to complain about. It does have one tremendous, and frustrating, usability issue with the virtual currency, and its action elements may not mix will with your average Facebook RPG player. Nonetheless, the app is still fun and addictive. It has a level of polish to it that can be appreciated by just about anyone and really turns the game into more of an experience, rather than just another app.

FIFA Superstars Leads Off This Week’s List of Emerging Facebook Games

The World Cup soccer tournament officially starts today. So it’s fitting that our weekly list of the fastest-growing small games on Facebook, those still under a million monthly active users, should be led off by EA SPORTS FIFA Superstars, the collaboration between Electronic Arts and the world’s leading soccer organization.

While there are a growing number of soccer games on social networks, EA’s title stands out for its licensing power — FIFA’s presence means that EA can invoke player and team names as much as it likes. That ability should keep EA’s game growing strongly through the brand-heavy World Cup, which lasts for an entire month.

Here’s the AppData top 20 list:

Top Gainers This Week – Games
Name MAU Gain↓ Gain, %
1. icon EA SPORTS FIFA Superstars 703,339 +648,046 +1,172.02
2. icon The Hardest Game of the World 312,682 +287,601 +1,146.69
3. icon Crazy Cow Music Quiz 592,367 +282,532 +91.19
4. icon Fashion World 246,580 +245,547 +23,770.28
5. icon Baking Life 811,925 +230,582 +39.66
6. icon Mahjong 504,143 +196,944 +64.11
7. icon - Clicks Racer Challenge 292,827 +157,271 +116.02
8. icon Temple of Mahjong 2 466,699 +157,098 +50.74
9. icon Funfari 637,704 +146,126 +29.73
10. icon COLLAPSE! 892,149 +141,787 +18.90
11. icon Millionaire City 281,694 +140,989 +100.20
12. icon Bubble Popp 2 377,717 +137,065 +56.96
13. icon Classic Word Games 341,749 +116,830 +51.94
14. icon Sweet World 320,479 +111,975 +53.70
15. icon Age of Champions 600,773 +108,297 +21.99
16. icon Belote 464,903 +99,728 +27.31
17. icon 快樂島 主 168,740 +98,271 +139.45
18. icon Bubble Paradise 562,585 +94,243 +20.12
19. icon Super Dance 183,234 +87,500 +91.40
20. icon Zoo Kingdom 266,768 +80,377 +43.12

Second on the list is The Hardest Game of the World, a puzzler that has players navigate a red square through a maze of moving parts. The Hardest Game is indeed unpleasantly hard, but seems to be growing by allowing players to publish their levels. It stands out for another reason, too: publisher BeatsGames also has Clicks Racer Challenge at number seven, marking a double coup for the small developer.

Crazy Cow Music Quiz, a music trivia game that first showed up on this list last week, is coming along nicely. It’s followed by Fashion World, the latest from Playdom investee Metrogames. Thematically and conceptually, this game is similar to Mall World, a boutique management game that took off a month or so back, but the visual design is quite different.

Continuing in the store management theme, next up is Baking Life, which as you might guess is about owning a bakery; one of the more enjoyable aspects of the game is creating custom baked goods. Baking Life should easily break a million MAU over the coming week.

Finally, take note of not just one, but two Mahjong games showing up this week: at number six, Mahjong, and at number eight, Temple of Mahjong 2. Their growth could be driven by Asian users, but it’s just as likely that American audiences are signing up; Arkadium’s Mahjongg Dimensions did well in April and May with the same traditional game.

New Hires in Social Gaming: Crowdstar, Playdom, Zynga, & More

Leading social gaming companies continue to make new hires, as we can see from LinkedIn. Here’s a quick look at people moving to big developers. Among notable new additions are Zynga’s newest Creative Director, Janus Anderson, Playfish’s new Product Manager Aadil Mamujee and Art Lead Duncan Brown, and CrowdStar’s new Vice President, Monetization Mike Ouye, formerly of Playdom.

Note that Zynga’s hires from Challenge Games are a result of it acquiring the smaller developer.

Here’s a look at everyone joining their new teams:

CrowdStar

  • Mike Ouye: Former Director of Monetization for Playdom joins as the new Vice President, Monetization.
  • John Harris: Former Consultant at Harris, Jr. Consulting is now a Developer for CrowdStar.
  • Arla Xhaxho: A new Product Associate for CrowdStar, and a former Research Assistant at Stanford University.

Playdom

  • Sunil Venugopal: Joins as Account Manager. Formerly performed the same job at MSN.
  • Ryan Mason: Becomes Product Manager of Analytics after being a Customer Insight Analyst.
  • Dan Tjandra: The latest Software Engineer for Playdom after being a Multimedia Software Engineer for Scientific Learning.
  • Katie Simpkins: A new Product Manager of Publishing for Playdom, and was formerly a Senior Marketing Associate.
  • Pavel Shahriar: Another Software Engineer, who came over from trippertlabs.
  • K.M. Fazle Azim Babu: New Software Development Engineer. Formerly a System Developer & Team Leader at Cention AB.
  • Daniel Igarza: New 3rd Party Outsourcer for Playdom. Formerly a 2D Artist at PoBros Inc.

Playfish

  • Aadil Mamujee: Joins Playfish as a new Product Manager. Prior, he was an Associate at Index Ventures.
  • Fred Easey: Becomes a Marketing Data Analyst. His last position was as a Data Analyst for Betfair.
  • Duncan Brown: Though it was technically last week, Brown joins as the new Art Lead. His last role was at PlayJam as an Executive Producer & Senior Artist.

RockYou

  • Amit Parikh: New Application Developer; former Software Programmer & QA Intern for Mobile Iron.
  • Debbie Margulies: Brand new Events Management/Marketing for RockYou. She was formerly a Consultant of Marketing Programs at Quindi Corporation.

Slide

  • Charles Hodges: Though it was last week, Charles joins Slide as a Quality Assurance Engineer, having left TVWorks where he was also a QA Engineer and Lead.

Zynga

  • Amy Young: New Senior Revenue Accountant; joining from Ernst & Young.
  • Janus Anderson: He becomes Creative Director and was former CCO of Challenge Games.
  • Ben Mullin: Ben is the new Ops Engineer at Zynga and former Game Software Developer.
  • Amanda Slade: She is now Community Manager at Zynga, also leaving Challenge games and her role as Customer Service Lead.
  • Stephanie Orkand: A former Associate Producer from Challenge Games takes on the same job for Zynga.
  • Matt Schultz: Interns as a Software Engineer; a once Web Developer/Network Engineer for Falkon Technologies.
  • Chuck Wadey: He comes in as Zynga’s new Art Director. This was a job, along with a title of Illustrator, from, again, Challenge Games.
  • Marty Brown: Another Intern, this time for Product Management joins from his former role as a Consultant at Deloitte Consulting.
  • Rahul Kapur: New Senior Server Engineer – Network Products; former Senior Software Engineer at Crossbow Technology, Inc.
  • Tom Kent: Tom’s one of Zynga’s newest Producers, also coming over from Challenge Games.
  • Jeremy Newton: A new Software Engineer for Zynga from Challenge Games.
  • Matt Klepac: Another Software Engineer from Challenge Games.

Investment Opportunities in Social Apps – Not Just Publishers and Not Just in the US

Smaller developers have been getting bought right and left this spring, and companies of all sizes are upping their bets on social gaming with new funding rounds.

The industry is well on its way to contribute $835 million to the $1.6 billion US virtual goods market this year.  And even though many developers’ traffic has been wracked by Facebook’s changes to its communication channels, there are still opportunities for investment, as leading social app investors told us recently.

This year, Inside Network held our first ever summit on these apps and games that are transforming how social platforms monetize and continue to engage users. Inside Social Apps 2010 featured speakers from many of the leading thinkers in the social gaming industry, from developers and publishers, to monetization companies and investors.

Maha Ibrahim, General Partner at Canaan Partners, spoke with Nick Lawler, Managing Director at Maverick Capital, Rick Thompson, Co-founder of Playdom, Tim Chang, Principal at Norwest Venture Partners and Atul Bagga, VP Equity Research at ThinkEquity on where their companies are anticipating the greatest investment opportunities, and what new players we might see debut on the social gaming landscape.

A clip of the highlights from this presentation:

Maha Ibrahim also spoke with us in an exclusive interview backstage about the specific vertical where she expects the biggest growth to happen. Ibrahim’s analysis falls in line with the trends we’re observing in global traffic stats and demographics data.

All signs point both to new advertising and marketing opportunities for brands and emerging, monetizable audiences for app developers.

Ibrahim’s full interview covers:

* Why she thinks payments — covering both new types of payments and international payments — will see the biggest growth in the coming year
* How payments and monetization companies can jumpstart their international growth using the aggregator strategy
* Her rule of thumb for developers seeking the most profitable markets outside of the US
* How payment vendors can still find opportunities in what seems otherwise to be a crowded market

The full interview is available through Inside Facebook Gold.

Super Whales: Top Social Game Spenders Pay More than $10,000 Apiece for Virtual Goods

By now, most people in the social gaming industry have heard about “whales”, those players who spend massively on virtual goods and gifts in games like Mafia Wars or Happy Aquarium. Whales have become a significant source of revenue for social game companies, especially in light of the tiny numbers of users, well under 10 percent for almost all social games, who ever pay anything at all.

Payments platform Social Gold has spent a lot of time this year talking about whales, which it has defined as users spending over $1,000. That measurement seems to pose a new question: if $1,000 is the baseline for becoming a whale, how much do the biggest spenders — the pod leaders, if you will — spend?

We checked in with the company to find out. And, well, let’s just say that there are some social gamers out there who really like their games.

Listed above, you can see the top five individual spenders within Social Gold’s network. According to the company, most whales are “pretty single-minded” — meaning that you can assume most of them spent their money in a single, beloved game. And to give perspective, we’ve included the average for all spenders.

The amount these leading whales are paying out looks pretty shocking, but whales are not strictly a new phenomenon. Before social gaming took off, there were casual game players spending profligately on their favorite titles; for instance, several years ago Andrew Busey of Duels.com (now part of Challenge Games, which just got bought by Zynga) told me that his game had attracted a set of hedge fund employees who competed to out-spend each other, paying over a thousand dollars each for armor and weapons.

But social gaming on Facebook has rocketed the casual market into the stratosphere, not only in terms of how many people are playing, but also in spending levels. What’s really surprising about the above figures is not just that someone would pay as much for virtual goods as they might spend on a new car, but that Social Gold tracked these five spenders over a period of just six months, since last November.

So what’s coming for the future? Spending on social games is open-ended, so some of the users who have paid out the most so far may simply continue their habits, racking up tens of thousands more dollars in purchases and eventually crossing into six-figure territory.

We can’t see any more about the five top spenders listed above — digging more deeply might present privacy issues — but the assumption of even larger whales in the future seems safe. The same features of social games that are designed to nudge non-spenders into shelling out a few dollars will also inevitably encourage people with large bank accounts to pour ever more money into their hobbies, even if social game companies don’t encourage extreme spending.

However, while it’s easy to imagine headlines about millionaires reduced to rags by their social gaming addictions, the future will inevitably paint a more complex picture. Social games are headed for real virtual economies, in which virtual goods retain value after being purchased; alongside people who make unwise investments, there will also be some who maintain their habit healthily, or even turn a profit.

Digital Chocolate Gets Credit Line for “General Corporate Purposes”

Digital Chocolate announced a “a multi-million dollar revolving line of credit” this week, from Silicon-Valley based Bridge Bank, “for general corporate purposes.” The money will, we assume, specifically go towards projects related to its latest efforts in social and mobile gaming.

The company has been around since 2003, and raised $43.9 million in three rounds, the most recent of which was in 2006; it has developed more than 80 titles that span from web, to mobile, to social games. Founder Trip Hawkins has previously told us that it has been profitable for a couple years already, partly through syndicating its games. While it didn’t disclose funding details, this line of credit is likely a cheaper way for it to finance small acquisitions, large ad campaigns, or other unusual expenditures, instead of raising more venture money.

And, while Digital Chocolate wasn’t specific about its plans, the company has been focusing on mobile and social gaming recently, so we expect it to spend the credit in those areas — if it hasn’t started already. Having launched the “NanoVerse” concept this spring — a universe of characters and virtual goods that span its titles — it has continued to expand, most recently with new social title Millionaire City. It’s a city-building Facebook game that expands on its earlier MyTown version of the genre, and it has been doing well in the couple weeks it’s been out, having racked up 282,000 monthly active users and 72,100 daily active users. Digital Chocolate is seeing growth from other games, too, according to our independent AppData service, and it is now at 2.35 million MAU and 260,000 DAU overall. And the company isn’t just focused on social, as it has also just released a new version of its Rollercoaster Rush game for Blackberry devices.

Especially given that it got started on Facebook years after many competitors, Digital Chocolate is one to watch. On a final note, there seems to be a management shift happening at the company as well, as president Ilkka Paananen recently stepped down to spend more time with his family, according to an email obtained by casualgaming.biz.

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