Highlights This Week from the Inside Network Job Board: Kabam, Lolapps, Blue Fang, & More

Recently, we launched the Inside Network Job Board – dedicated to providing you with the best job opportunities in the Facebook Platform and social gaming ecosystem.

Here are this week’s highlights from the Inside Network Job Board, including positions at Kabam, Lolapps, Blue Fang Games, ohai, Sleepy Giant Entertainment, and 4mm Games.

Listings on the Inside Network Job Board are distributed to readers of Inside Facebook and Inside Social Games through regular posts and widgets on the sites. That way, you can be sure that your open positions are being seen by the leading developers, product managers, marketers, designers, and executives in the Facebook Platform and social gaming industry today.

I-Jet Media Looks for Western Social Game Developers to Distribute in Europe, Russia

Although many Western developers know that the eastern European and Russian markets are quickly growing, most are also far from making any effort to enter those countries. I-Jet Media hopes to change their minds.

We first heard about i-Jet a few weeks back, when the company announced a partnership with Playdom to publish a few of its games, as well as combat Russian piracy. I-Jet is actually several years old, though, and its current publishing focus is modeled on a gap CEO Alex Kostarev saw in the market as social games took off.

“In 2009, the most difficult thing was that nobody would help with marketing or users. We were going from company to company seeing if anyone would publish our game,” he says. “So in April of 2009 we went to China and talked to Elex, and started publishing Happy Harvest in Russia.”

Happy Harvest quickly grew to become Russia’s most popular social game, according to Kostarev, and ended up making $20 million in 2009.

That’s not a huge amount of money by the standards of a Zynga or Tencent, but Kostarev says that i-Jet’s focus is on making it effortless for developers to license a game. I-Jet has its own API, which developers can hook their game up to. After that, i-Jet does the work of localizing the game and connecting the API to Russia’s big networks, like Vkontakte, and over a dozen smaller, regional networks around Europe.

By spreading the game across a large number of networks and touching a lot of players, Kostarev claims that i-Jet can earn an extra $100,000 to $400,000 a month for a good game, with little to no effort from developers.

This isn’t the first such publisher we’ve talked to. It’s an increasingly common model in areas of the world where there’s a large, dominant competitor to Facebook. For example, we also recently profiled the Brazilian publisher Mentez, which works mainly on Orkut.

The key for all of these companies is convincing developers from the rest of the world to offer up their best content for a win-win deal — Brazil or Russia is unlikely to produce anything like the variety of social games that comes out of the United States or China, while the developers themselves don’t have the time to work on expanding into those markets.

Terms are key, of course, and we have yet to hear from developers how happy they are with their overseas deals. But for the moment, the publishers are the only game in town; as we’ve recently pointed out in two articles on Inside Facebook, both Brazil and  Russia and Eastern Europe are growing on Facebook, but the social network’s presence in either area is still quite small overall.

Kostarev thinks that Facebook may never get the upper hand in countries like Russia. “I think Facebook will be successful here in a year, and we’ll help them to do that. But as far as the leading companies, we see the trend that if there’s a local player, they’ll get the most of the market,” he says.

Millionaires and Monsters on This Week’s List of Fastest-Growing Facebook Games by DAU

This week’s AppData list of fastest-growing Facebook games by daily active users appears, at first glance, to have been overrun by Zynga apps. As happens occasionally, a dip in traffic just over seven days ago made a half-dozen Zynga apps look like they’ve suddenly added thousands of DAU, when they’ve actually just recovered from a temporary decline.

Here’s the full list:

Top Gainers This Week – Games
Name DAU Gain Gain,%
1. Original FarmVille 17,872,226 +474,339 +3%
2. Original Texas HoldEm Poker 6,195,504 +427,949 +7%
3. Original Café World 4,753,385 +244,394 +5%
4. Original Mafia Wars Game 4,242,515 +231,654 +6%
5. Original Happy Pets 1,252,445 +192,315 +18%
6. Original Treasure Isle 3,805,755 +190,748 +5%
7. Original Millionaire City 1,716,187 +184,096 +12%
8. Original Restaurant City 2,615,544 +183,664 +8%
9. Original 開心魚塘 224,314 +152,980 +214%
10. Original Monster World 650,044 +104,091 +19%
11. App_2_122353571139137_4163 The Price Is Right Game 314,838 +84,303 +37%
12. Original Zoo Paradise 665,162 +79,429 +14%
13. Original Happy Aquarium 2,125,251 +74,759 +4%
14. App_2_256799621935_1837 Car Town 1,003,848 +59,683 +6%
15. App_2_114335335255741_9738 City of Wonder 1,132,563 +57,500 +5%
16. Original Casino City 190,805 +50,539 +36%
17. Original 開心水族箱 1,396,629 +50,286 +4%
18. Original Backyard Monsters 364,006 +49,583 +16%
19. Original 開心寶貝(开心宝贝) 402,379 +49,508 +14%
20. Original Games 1,268,987 +49,192 +4%

Happy Pets, an older CrowdStar game, did make a genuine gain. Several of CrowdStar’s games have risen over the past few days, driven by a push around the release of two new titles, It Girl and Pop Boom.

Millionaire City and Monster World, at numbers seven and 10 respectively, fit into a different group; these are both games from mid-sized developers that show no sign of stopping their steady growth. Millionaire City has an especially high stickiness factor, with 22 percent of players returning on a daily basis.

開心魚塘, a fish-raising game from Memoriki, is still drawing in a significant number of users. The app appears to be attracting a few players who don’t use Chinese with localized translations, although the quality of those is rather uneven, as seen in the screenshot below.

And at number 11, The Price Is Right Game is continuing to grow, having crossed 300,000 DAU this week. It’s about a month into its rise now, so it should be interesting to see whether the game show-inspired title can keep moving up.

Candy Shop Grows on Facebook

Candy ShopOne of the most recent games to appear on our top emerging Facebook games list is a smaller app by the name of Candy Shop, developed by Tall Tree Games. With over 318,000 monthly active users, Candy Shop is showing some impressive momentum, having gained 126,000 of those users in just the past week.

Candy Shop won’t look new to most social game aficionados. The game is, essentially, a business sim almost identical to Baking Life from Zip Zap Play, except that many of Candy Shop’s game elements feel completely pointless. Of the various features, only a handful of minor ones feel much different.

The basic idea of the game is the same as virtually every other business-sim out there. Here, players make candy and sell it. Utilizing candy making machines, users create the different sweets over a period of time. There are three types of candies that can be made including chocolates, hard candies, and cotton candy. In order to make them, users must reach a certain level and purchase the respective machines. When finished, the candy is placed into a display case (one type of treat per case) with a set number of servings.

PreparationsOnce candy is on display, customers will then begin filing into the shop to make their purchases from the user’s avatar while two “temp workers” sweep the floors. And this is where the issues with the game begin. There is no visible point to the workers. All they do is walk around and sweep, but there is nothing to actually clean up! It’s possible that, like other virtual space games, the store gets dirty after the user is away for a few hours. But thus far, though, not a single item of refuse has been seen, and all the temporary workers do is suck up income (for their salary).

In order to make them free, players must post to their wall and have friends join. It isn’t a new to “hire” friends for such games, but with no useful jobs for these workers to perform, the mechanic feels like blatant viral advertising, giving no reward to the player.

It’s possible that once the user can afford more registers, they will be able to hire friends to man them. But even if this is correct, it makes no difference, as all it would provide is a faster means of serving customers so that they do not getExtra Servings upset — and in Candy Shop, that’s a non-issue. Normally, these games have a customer happiness level associated with them, and the happier customers are, the more customers visit the player’s shop.

That is not the case with Candy Shop, as a constant and consistent stream of visitors always comes and there is zero rating.

Players could literally do nothing, and there would be no penalty of any sort. They just don’t make any money. This takes away any challenge and strategy from the game, making the title a moot and fruitless endeavor. It seems likely that Candy Shop is doing well mainly because fans of this genre have come to expect a new flavors of virtual business games on Facebook. Candy is different than pastries, after all.

Beyond gifting and visiting friends’ virtual spaces, players can also collect tips from each other and hire one another as workers. Additionally, whenever a player creates a piece of candy, it can be posted onto Facebook for additional servings. All that said, the “hired workers” leads right back to the collection of notable issues.

CustomizeThe only other mechanics warranting mention are some convenient means of salvaging goods that were not “harvested” on time, or cooking them instantly using virtual currency. There is also a nice quest system that gives the users some goals.

Overall, Candy Shop feels like a business sim clone that has been done before, and done better to boot. Though the new app is doing decently well, it would be surprising if the game lasted the test of time. Players that like this genre will check it out, but eventually go back to something better.

Following Facebook’s Most Recent Changes, Developers Worry About Virality

Earlier today, Facebook announced new algorithms for news feed and user communication and an updated games dashboard. These are the biggest app-related changes Facebook has made to its platform since May, when it began minimizing the appearance of app feed items.

Overall, the update is great for users who don’t want to deal with games on Facebook. Social gamers and developers, though, will need to get used to a number of changes — some of which they may like more than others.

The changes can be boiled down to six major points (further explained in our earlier post and live blog):

  • Automatic app bookmarking
  • New left-hand side dashboard navigation for games
  • Collapsed stories about apps will be expanded back into multiple feed items for gamers
  • Updated policies
  • No more feed items about apps for non-gamers
  • A new feed item about games, called discovery stories

Most of the developers at Facebook’s announcement event, which we also attended, seemed positive about the first three points, which all support user engagement. Users who already play games will see more feed items from those games, get better notifications when action is required, and have an easier time getting back to their favorite apps.

“Facebook has sometimes been accused of hindering the system. But they seem to be thoughtful about these changes, and a lot of what they said on a high level made sense,” said Frederic Descamps, CEO of A Bit Lucky. “Quality will become more and more of a factor in these games.”

The change noted in the last two bullet points above, though, was nagging at most of the developers I spoke with. One of the first I talked with, Lolapps CEO Arjun Sethi, summarized the big worry of the day: “One thing we’re worried about is, how do you find new gamers? How do they know if they will like the game or not?”

To explain the worry in more depth, consider the popular strategy of having users pump out as many feed items as possible to drive up virality, which Mark Zuckerberg said “burns out” core users during his on-stage talk. Even developers that don’t use that strategy still see traffic growth from feed stories, which expose new users to their games.

Facebook’s motivation in concealing feed items from non-gamers, according to Zuckerberg, is the extreme reaction the company sees to games: most users either love or hate them. So in the interest of keeping both groups placated, Facebook has moved to hide games entirely from a large set of users.

But now developers are worried that many of Facebook’s 300 million or so users that aren’t currently playing a game have totally been cut off, whether or not those users actually hate games.

Facebook’s response to these worries is that it has not totally removed the feed channel as a growth driver. If several friends of a specific user have begun using a game, that user will receive a generic notification that their friends are playing, called the “discovery story”.

Going forward, discovery stories will be a big part of Facebook’s growth strategy. However, there are a lot of uncertainties for developers in the discovery story.

One worry is that these stories won’t inspire users to give the app a try. Developers have put a great deal of effort into optimizing the feed stories they send out. The discovery story Facebook showed off on stage (shown below) may not do as well.

More importantly, Facebook hasn’t explained the algorithm behind the discovery story. What they showed off appears to require that several friends are active users of the same game, which sets a high bar.

I caught up with the head of Facebook’s new games team, Jared Morgenstern, to see if he could offer any more details. For now, according to Morgenstern, most users are in fact bucketed into two clear groups, gamers and non-gamers. But over time, he said, Facebook will customize for individuals, leaving only those who are absolutely opposed to games in the current non-gamer group.

What developers have to work with for now is a user acquisition flow that has reverted almost entirely to invites between users and advertising, with a small contribution from discovery stories. But Morgenstern says that Facebook is keeping an eye on the channels, and will make sure that smaller developers, who can’t necessarily afford much advertising, still have a chance.

“When you’re considering a new gaming platform, that needs to be Facebook,” he said. That statement in itself is a big change from a year ago, when Facebook seemed unhappy with its growing popularity as a gaming destination.

We’ll be covering some of the more specific changes in depth tomorrow, including the policy updates, over at Inside Facebook.

Facebook Making Big Changes to Discovery, Virality in Games Today

The Inside Network team is currently in attendance of a Facebook event to announce new platform changes relating to games, affecting the news feed, requests, bookmarking and more. We’re live-blogging the event on Inside Facebook, so head over there if you want the stream. We’ve also written up a full preview on Inside Facebook (excepted below); for more on the changes, check back later for more coverage.

In the latest of Facebook’s ongoing efforts to reshape its developer platform, it is introducing big changes aimed at the most successful category of third-party applications to-date: social games and related applications.

Overall, the changes could hurt virality for many developers, even if they see increased engagement; Facebook also says that there is more help on the way to social game developers in the coming months, including a revamped infrastructure and new APIs.

Most importantly out of all the of the changes today, the company is altering how the news feed will work.

After the changes take effect, people who do not play games will no longer see news feed stories from friends who do play games — same goes for any other third-party app. Because news feed stories were a main way that people found games in the first place, we expect app virality to decrease as a result of this change. Facebook is clear about its rationale behind this: “Tens of millions of app wall posts are deleted every day by people who find them irrelevant. By surfacing relevant stories based on usage and discovery stories based on friends, we believe we’re providing the best user experience and building lasting and long term value.”

Read the rest on Inside Facebook>

Pocket Frogs Adds Amphibious Fun to the iPhone and iPad

Pocket Frogs NimbleBit recently released both iPhone and iPad versions of Pocket Frogs. While this app is similar to many of the social pet-raisingapps before it, it comes with its own unique concepts and style.

The game centers on growing and breeding frogs, reminiscent of the aquarium boom. But Pocket Frogs has a strong collection element and some twitch and exploration mechanics.

The core is acquiring various species of frogs and placing them into a flat, top-down habitat that can be decorated in your own style. You must care for and grow your frogs to eventually sell them for a profit.

PondThere’s nothing particularly original in that. But the game has some original mechanics. For example, once your frogs are mature, you can take them to the “Pond”– an infinite pond of lily pads your frogs can jump to with a tap. Buzzing about the pond are dragonflies of varying sizes, that you must catch in order to feed your frog and make it happy. This is done by jumping from pad to pad, and hitting any bugs in between. Once a certain happiness level is reached, the frog becomes “tame” and new options open up.

While in the pond with your tame frog, you will encounter other random frogs. Putting your frog on the same pad with another will give you the option to breed the frogs. But, there is a level requirement to breed rare certain frogs. There’s also a small cost to place the frog egg into the nursery.

The pond features an exploration element. You can  jump around, for as long as you like, in search of random treasures. Represented by wrapped gifts, these can be in-game coins, Stamps, or growth potions.

BreedingBack at the nursery, the frog eggs will slowly hatch over a period of time (this can be accelerated via purchasable growth potions) and then passively grow into maturity. Once you have grown and tamed your frogs, you can place them in a virtual habitat where they can breed with other tamed frogs. Before two tamed frogs breed, you can see what possible varieties of offspring they will produce.

Breeding gives a chance to acquire a certain species and some are very rare. Once a frog is tamed, you can catalog it in your list of frogs to show off your collection.

Working with frogs isn’t the only thing to do in Pocket Frogs. There are also 2D objects to decorate your habitat with, such as tiles and leaves. Though attractive, these don’t allow a lot of variety. But they do reveal another monetization method: stamps. Each purchase is delivered via a mail system and will take a set amount of time. Stamps make delivery instant.

DecorBoth iDevice versions of Pocket Frogs are on the Plus+ social network, with leaderboards based on experience, money, and so on. You can also add friends as neighbors, which not only allows you to view their virtual habitat, but also trade and gift décor and frogs, which is exciting as everything purchasable is gated by level.

Though the core element of Pocket Frogs is not original, it has enough new elements to make it feel fresh.  And the collection, twitch-gaming, and exploration are nice addition to the animal husbandry. Pocket Frogs is certainly worth a try for people that enjoy animal breeding and collection games.

Last Week to Pre-Order Inside Virtual Goods: Tracking the US Virtual Goods Market 2010 – 2011

With an up-to-$750 million acquisition of Playdom by Disney, an up-to-$400 million acquisition of Playfish by Electronic Arts, the acquisition of Tapulous by Disney, and hundreds of millions of dollars in venture investments, virtual goods are impacting businesses across the media landscape. Virtual goods, and the companies that create them, may be bringing the largest disruption entertainment, communication, and e-commerce infrastructure businesses have seen in years.

Inside Network is proud to announce a new original research report by Justin Smith and Charles Hudson that presents a comprehensive examination of the size and future of the virtual goods market in the United States, entitled Inside Virtual Goods: The US Virtual Goods Market 2010 – 2011. This is Inside Network’s second annual edition of the US Virtual Good Market report. It will be released on September 28, but is available for discount pre-order now.

Where will the virtual goods market go in 2011 and what are the biggest opportunities left unclaimed? How will existing players fare as Facebook continues to reshape the social gaming landscape, and larger and more sophisticated players enter the market? Inside Virtual Goods: The US Virtual Goods Market 2010 – 2011 provides deeper insight into monetization, development, and the key questions facing the space in 2011 than you’ll find anywhere else.

Get the Annual Membership
Get Annual Membership (Includes Report + 3 Additional Quarterly Issues): $2,495 $1,995 USD*
OR Buy Single Report: $995 $795 USD*
* Pre-order discount ends September 27, 2010. All pre-ordered reports will be delivered on September 28, 2010.

About the Report

Inside Virtual Goods is a new report researched and created specifically for entrepreneurs, investors, and analysts interested in the growth of this exciting new category of online commerce that is fueling the growth of games-as-a-service businesses. During a research phase spanning the last few months, co-authors Justin Smith and Charles Hudson have spoken with dozens of executives and entrepreneurs from all parts of the ecosystem in order to form what we believe are the most detailed estimates, analyses, and predictions for 2010 and 2011.

We focused and organized the report around the following areas:

  1. Social Networks, Applications, and Games - The explosion of the virtual goods market on social networks is one of the biggest stories of 2010. We delve deeply into the trends, stats, key players, opportunities, and challenges facing the space this year and next.
  2. Mobile Applications and Games – Mobile application developers that have been early adopters of the free-to-play model are now seeing significant growth in 2010. Our study breaks down the key opportunities and challenges facing this emerging space going into 2011.
  3. Casual MMOs and Virtual Worlds - Virtual worlds and casual MMOs continue to grow as a meaningful share of the virtual goods opportunity in the United States. Our study breaks down the key drivers for success in this segment, trends in monetization and engagement, and the prospects for the future.
  4. Hardcore MMOs and Free-to-Play Online Games – Developers in the MMO / MMORPG space have been among the earliest adopters of the free-to-play model. We explore why free-to-play MMOs are succeeding, revenue and user trends, and the key issues facing this space as we head into 2011.
  5. Emerging Areas: Console Games and Subscription MMOs – As the virtual goods business model becomes more well understood, it is beginning to show up in new and interesting areas of the games and entertainment landscape. We highlight a few of the more promising areas where virtual goods are emerging as a promising opportunity.

Each section contains:

  1. A brief history on the evolution and growth of this space in the US, including a description of key players.
  2. Estimates on the size of the US virtual goods market in 2010 in that area.
  3. A diagnosis of the key opportunities and issues facing the growth of that space, including our outlook and projections for 2011.

In addition, prior to delving more deeply into each market segment, we’ve provided an overview of the emerging payments ecosystem that is growing to serve these new businesses. Traditional e-commerce infrastructure providers only offer a partial solution, and the virtual goods payments layer is currently in a major state of flux. In the report, we describe the variety of solutions that have been brought to market to date, and the key challenges facing the industry from a payments perspective as a whole.

For more details, check out the full table of contents below.

The annual membership, which includes the report and three additional quarterly updates, is USD $2,495. Alternatively, you can obtain just this report for USD $995.

The annual subscription brings you a total of four comprehensive reports comprising months of original research. Recent reports have covered:

  1. The Future of Social Gaming. Social games make up over half of the US virtual goods market. This report provided detailed coverage of exactly how this industry has managed to thrive, who its most valuable players are, and deeper insight into monetization, development, and customer acquisition than you’ll find anywhere else..
  2. The Spending and Usage Patterns of the Social Gaming Audience. Who are the millions of users whose time, money, and engagement have made social games into household names and their developers into technology industry celebrities? This report presented the only independent, original research into user profiles, behaviors, and attitudes toward social games and virtual goods.

Although the report will not be released until Tuesday, September 28, we are offering a special pre-order discount for those who purchase now. The pre-order price of US $795 for this report or US $1,995 for a one-year subscription is now available until September 27.

We are looking forward to continuing to cover the evolution of the space over the coming year. We look forward to hearing from you!

Table of Contents

1. Introduction

  • How We Got Here: A Brief History of Virtual Goods Worldwide
  • Defining Terms
    • Registered users
    • Active users
    • Average revenue per user (ARPU)
    • Average revenue per paying user (ARPPU)
    • How do different developers manage their businesses?
  • Growing Virtual Goods Markets in the US
    • Social Networks, Applications, and Games
    • Casual MMOs and Virtual Worlds
    • Hardcore MMOs and Free to Play Games
    • Mobile Applications and Games
    • Emerging Areas: Consoles, Subscription MMOs
  • Methodology

2. The Virtual Goods Payments Ecosystem: An Overview

  • Large Payment Platforms
  • Mobile Payment Providers
  • Offer Providers
  • Direct Payments vs Offers
  • Pre-paid Cards
  • The Arrival of Facebook Credits
  • New Payment Providers
  • Managing Fraud
  • Related Companies

3. Social Networks, Applications, and Games

  • Introduction
    • The Global Rise of Facebook
    • The Virtual Currency Payment Ecosystem Explosion – and Migration to Facebook Credits
    • Increased Optimization for Virtual Goods
  • Social Networking Platforms Today
    • Facebook
    • MySpace
    • Twitter
    • Google
    • Others
  • Significant Changes to Facebook Platform Dynamics in 2010
    • Distribution & Engagement
    • Monetization
  • Social Application and Game Genres: How Do They Perform?
    • Role Playing Games and “Hardcore” Mini-MMOs
    • Simulation and City Building Games
    • Pet Games
    • Poker Games
    • Gifting Apps
    • Arcade Games
  • Who’s Buying Virtual Goods?
    • Gender Breakdown
    • Age Breakdown
    • Geographic Breakdown
  • How Are They Spending Money?
    • Item Type Breakdown
    • Payment Method Breakdown
  • Market Size Estimate
    • Total Number of Monthly Paying Users
    • Total ARPPU Per Month
    • Total US Virtual Goods Revenues from Social Networks in 2010
    • A Quick Look at Revenues for Top Social Game Developers
  • 2011 Outlook
    • Growth Rate
    • Major Risks that Could Hamper Growth
  • Leading Companies

4. Casual MMOs and Virtual Worlds

  • Introduction
  • Demographic Breakdown
    • Gender
    • Age
  • Payments
  • Analyzing the Market Opportunity
    • ARPU
    • ARPPU
    • Market Size Estimate
  • 2011 Outlook
    • Growth Rate
    • Key Challenges
  • Leading Companies

5. Free to Play MMOs / Hardcore Games

  • Introduction
    • History of free to play MMOs
    • Emergence of the free to play MMO market opportunity in the US
    • Major genres for free-to-play MMOs and hardcore games
  • Analyzing the Market Opportunity
    • Total Player Base
    • ARPU
    • ARPPU
    • Payment methods
  • 2011 Outlook
  • Leading Companies

6. Mobile Applications and Games

  • Introduction
    • History of virtual goods model in US
    • Major genres for free-to-play iPhone apps and games
  • Analyzing the Market Opportunity
    • Total Player Base
    • ARPU
    • ARPPU
    • Payment methods
  • 2011 Outlook
  • Leading Companies

7. Emerging Areas

  • Console Games
  • Subscription MMOs

8. Conclusion

  • Overview: 2010 Market Estimates
  • Looking Ahead: 2011

9. Appendix: Company Index

About the Authors

charles-hudson-headshotCharles Hudson

Former VP Business Development, Serious Business & Host, Virtual Goods Summit

Charles Hudson is the former VP of Business Development for Serious Business, a leading social games developer on the Facebook platform. In addition to his work at Serious Business, Charles Hudson organizes two of the leading conferences in the social gaming and free-to-play games industries, the Social Gaming Summit and Virtual Goods Summit.

Prior to Serious Business, he was formerly the Sr. Director for Business Development at Gaia Interactive, a leading online hangout for teens. Prior to Gaia, Charles worked in New Business Development at Google and focused on new partnership opportunities for early-stage products in the advertising, mobile, and e-commerce markets. Prior to joining Google, he was a Product Manager for IronPort Systems, a leading provider of anti-spam hardware appliances that was acquired by Cisco Systems for $830 million in 2007. Charles holds an MBA and BA from Stanford University.

justin-smith-headshotJustin Smith

Founder, Inside Network

Justin Smith is the founder of Inside Network, the first company dedicated to providing news and market research to the Facebook platform and social gaming ecosystem. Justin leads Inside Network’s Inside Virtual Goods and AppData research and data services, and serves as co-editor of Inside Facebook and Inside Social Games.

Prior to Inside Network, he was formerly Head of Product at Watercooler, one of the leading application and game developers on the Facebook Platform. Prior to Watercooler, Justin was an early employee at Xfire, the largest social utility for gamers, which was sold to Viacom in 2006. Justin holds a degree in Computer Systems Engineering from Stanford University.

Get the Annual Membership

The annual membership, which includes the report and three additional quarterly updates, is USD $2,495. Alternatively, you can just download this report for USD $995. Although the report will not be released until Tuesday, September 28, we are offering a special pre-order discount for those who purchase now. The pre-order price of US $795 for this report or US $1,995 for a one-year subscription is now available until September 27.

Get Annual Membership (Includes Report + 3 Additional Quarterly Issues): $2,495 $1,995 USD*
OR Buy Single Report: $995 $795 USD*

* Pre-order discount ends September 27, 2010. All pre-ordered reports will be delivered on September 28, 2010.

Russian Developer Progrestar Gets into Facebook with Digger

DiggerProgrestar, an established social developer in Russia,  has begun venturing into Facebook with a new title called Digger.  We discovered Digger when Progrestar informed us of their exclusive, use of Facebook Credits, and the treasure hunting app has slowly begun its climb up the social network charts.

Digger borrows a number of elements from Treasure Isle and Treasure Madness, but has some original aspects. Players dig up treasure and use its value to decorate a virtual space. You start off on a tiny spit of land and dig up the grid spaces in search of treasure and experience.  When players complete treasure sets of five, they can be sold for in-game coins or kept in a museum.

TreasureIf no treasures pop up, players will often still get money (bottle caps) or food to restore energy.  There are also random obstacles that require more than a shovel to circumvent, including trees, bushes, flies, and bear traps (bear traps?), and even the occasional pirate. These challenges merely add more variety to the same concept found in Treasure Island.

Buying  tools is different, though. On a player’s home island, they can order various goods from an opportunistic traveling salesman. He carries many objects, but some will need to be ordered, taking anywhere from 30 minutes to a couple hours for delivery.  To mitigate the wait, players can visit a friend’s island and collect a random assortment of supplies (sort of like the different colored gem trees in Treasure Isle).

Home Island“Supplies” refers to more than just consumable items like dynamite. There is also, very literally, an item called “Supplies”  required to explore new islands. Oddly, exploring an island not only incurs a supply cost, but a virtual currency cost as well. This seems like a poor choice. Players are given enough starting virtual currency to explore all the low-level areas, but gating off a core game play element seems unlikely to help with user retention. Unless a player becomes truly addicted to the game, he or she will simply stop playing when all the virtual currency they were given is spent — which seems to be happening, judging by the game’s extremely low stickiness factor, with only two percent of players returning on a daily basis.

Various bonus items that can also be purchased with virtual currency, such as a magnet or a cookbook that increase the rate in players find certain items. The cookbook is particularly useful. Unlike Treasure Isle, players do not gain a larger pool of energy as they level up, and digging requires a lot. Players start with 60 energy, and each dig costs seven more, meaning that playtime in one sitting is exceedingly short. Social elements can be used to extend energy — players create teams of friends, the more people on the team, the more energy the player has.

TeamOur biggest complaint with Digger is the pacing. The game tends to run sluggishly and after a while, it became nearly unplayable. This slow pace is further emphasized by the visuals and game mechanics. Not only do players run out of energy quickly, but it takes a while to buy supplies even the animations feel very stiff and slow.

Digger has some new elements to differentiate itself from Treasure Madness and Treasure Isle, but still feels like more of the same, and not  as polished. The game has grown fairly rapidly, reaching 152,545 monthly active users, but with only 2,718 DAU it’s evident that players are looking for more. Hopefully, Progrestar will be able to work out some of the kinks before it loses its growth momentum.

Niche Network IMVU Takes on Social Gaming

When social games first took off on Facebook, most other big social networks took notice and shifted their business plans to include gaming. Months later, a second round of much smaller, but growing social startups is moving to add games, too.

IMVU is the latest. With 10 million unique visitors per month, IMVU is a flyspeck in comparison to Facebook. But it’s also significantly different. The network, which requires a downloadable client to use, has users interact through personalized avatars. It also has a significantly different business model from most social networks, earning most of its revenue from sales of virtual goods.

Despite its status as a lightweight virtual world with game mechanics, IMVU hasn’t always had distinct games for users to play. “We’re answering one of the questions users have been asking us for some time,” says CEO Cary Rosenzweig “I’m all dressed up, bringing friends in and interacting with them, but what else can I do?”

Making games available isn’t a simple addition to IMVU, according to Rosenzweig; it’s a complete change in the company’s business model and aims.

The first partners to bring games to IMVU will be Omgpop, which has its own gaming destination site, and Heyzap and Viximo, which both take games created by other developers across the web. At the moment, there are 75 games on IMVU.

Rosenzweig holds up the example of Top Modelz, a game recently added by Viximo, as one that will work well on IMVU. In the game, users trade images of themselves and other player’s avatars, making and losing virtual currency.

There hasn’t been time for any single game concept to float to the top, but Rosenzweig hopes to see games that can incorporate IMVU’s existing avatars for a more personalized experience — which, he says, will also make the average player spend more. “People at IMVU are used to spending money, because they’re very personally involved, the avatar is them,” he told us.

The last network we saw add games before IMVU was Myyearbook, which also has a deal with Omgpop. Rosenzweig thinks this type of niche social network will find success with games and continue growing.

“Facebook grew so fast and got so huge that it’s basically the internet for many of our users,” he says “IMVU is their primary network, Facebook is secondary… having them go back and forth between these two media will be very common.”

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