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Facebook Credits to become mandatory currency

Tue 25 Jan 2011 9:24am GMT / 4:24am EST / 1:24am PST
OnlineDevelopment

Uniform funds can still be used to purchase game-specific credits

Facebook has confirmed that it will be completing the introduction of its Facebook Credits system, with the virtual cash becoming the single buy-in point to convert real world money into credits to spend on the social network.

Once the Facebook Credits are bought they will be able to be turned into title specific funds, such as City Cash for Zynga's CityVille, where they can then be used to buy in game items and bonuses.

The long term plan appears to be to encourage the official currency as the only one, enabling players to keep funds transferable between titles - a move which Facebook argues is good for users, but is likely to anger some developers hoping for a higher lock-in rate.

This encouragement would take place via the medium of prominent placement and better advertising for developers selling their goods in Facebook Credits rather than in a proprietary virtual currency. Facebook takes a 30 per cent cut of any purchase made using Facebook credits - which would make for a significant revenue stream if recent estimates about the $835 million value of the virtual cash exchanges on the network are realistic.

The beta period for the payment system ends today, with all developers expected to accept the credits by July 1, 2011. Most of the major players in the area, such as Zynga and Playfish, have already been discussing the deal with elements of the Facebook team and are believed to have reached terms.

The announcement about the service came a little earlier than expected after website TechCrunch obtained a leaked rumour about the roll-out yesterday. The details were later confirmed by Faceboook itself.

11 Comments

Sam Brown Programmer, Cool Games Ltd.

235 164 0.7
Hopefully the devs will start using FB credits as soon as then, otherwise that's going to be like going on holiday, changing your money into "world currency tokens" or something at the airport, flying to your destination, then changing your money again into local currency. What a PITA.

Posted:3 years ago

#1

Klaus Preisinger Freelance Writing

1,135 1,171 1.0
So Facebook is now a bank issuing a currency? Smart. That way they earn real Dollars in interest on every unspent FB Credit.

Posted:3 years ago

#2

Christopher Bowen Owner, Gaming Bus

118 0 0.0
Facebook should have just gone all the way and said that any games on their service *will* use Facebook Credits, period. Allowing developers to transfer FC into their own currency of FishPoints, Mafia Dollars or whatever the hell there are nowadays just adds an annoyance to consumers, and a level of opacity that is unnecessary and could potentially lead to increased prices. After all, if everyone has their own currency, instead of using FC (which already requires conversions in the heads of customers), how can people compare the prices of one game's virtual goods to another? That's a lot of math for games that, by their very nature, are supposed to be as casual as they get.

Posted:3 years ago

#3

Alex Loffstadt Community Manager, Outso Ltd

84 0 0.0
@Klaus Think it's far more that Facebook have woken up to the fact that they have an incredibly popular and powerful platform that has been making other people money, which is important when you consider that FB ads aren't perhaps making as much as they should while companies like Zynga overtake EA in revenue.

The use of FB credits should have 2 positive effects:

1) Supports FB and allows the site to continue to improve (Though honestly they may want to stop some of the unnecessary layout tinkering)

2) One of the biggest hindrances to FB as a gaming platform has been the sheer amount of rubbish that has flowed through in terms of apps. and allegations of fraud. The creation of a unified currency system should mean that FB get involved in a certain amount of quality control and better protection for FB users.

Or at least one would hope

Posted:3 years ago

#4

David Amirian Writer

59 3 0.1
i dont agree that games should only use FC in-game. If each credit is worth a dollar or whatever, and you dont want to spend 1 dollar on a stupid hat for your cityville guy, they would have to go into 0.1 FC or whatever, and that's just as much math-involved as converting into their own currency, which THEY do, not you, when it comes down to it.

just like anything that doesn't use a real dollar amount, "Facebook Credits" or in-game "money" makes you more willing to spend money because once you deposit money it isn't "money" anymore, they're points and expendable -- made to be used.

The only reason i even like this idea, though i'd never use it, is having only one thing hold your payment information rather than many individual games, run by companies that may or may not be shady. At least we know who to complain to if Facebook leaks payment info.

Posted:3 years ago

#5

Shaun Farol Studying Computer Information Systems, California Polytechnic State University

40 12 0.3
I am not sure if I like this sort of conversion. By using their own game-specific currency it allows developers to be flexable in their pricing and blend paid premium content with those earned in-game. IE allowing true micro transactions and allowing stuff to be purchased at fractions of credits than a credit whole.

For example I know several games that have their own "world currency" which can be bought using FB Credits but beyond the cash route they can also be earned in-game in small amounts by completing daily challenges encouraging players to log in every day and feel like they are "Earning" or "Saving" real money and lowering the barriers between paid and free players.

Unless FB is willing to take responsibility for all games that use FB Credits then I think in terms of the consumer while at first it may appear to be good offering a level of simplicity in the end it might raise prices and not allow certain devs their regular "sales" in attempts to boost sales during the money conversion to game currency.

Posted:3 years ago

#6

Graham Simpson Tea boy, Collins Stewart

219 7 0.0
Great. So pay in a non $ currency and get screwed by the fake exchange rate as determined by FB (Paypal do the same thing). Then watch your FB credits real value fall as the $ gets hammered. Cash out and get screwed by the fake exchange rate again. God bless capitalism.

Posted:3 years ago

#7

Thiago Attianesi Creative Director, Fan Studios

59 2 0.0
This is will be big, famous games will have more power and the new ones will have more difficult to enter in facebook market.

Posted:3 years ago

#8

Jeffrey Kesselman CTO, Nphos

112 0 0.0
The real issue isn't the lock-in question, its the absurdly high rate facebook charges developers.

Industry standard for electronic transactions with people like PayPal and Offerpal is 2.9% + 30 cents.
On a $5.00 purchase thats about 31 and a half cents. Compare that to Facebook credits where the charge is 30%, or $1.50. And the disparity only gets worse as you go higher in value.

Facebook credits are basically facebook's way of robbing game developers to pump up their own balance sheet.

Edited 1 times. Last edit by Jeffrey Kesselman on 25th January 2011 9:15pm

Posted:3 years ago

#9

Thomas Dolby Project Manager / Lead Programmer, Ai Solve

340 292 0.9
Facebook may offer developers a huge potential user base, but they do seem to enjoy making their platform unattractive sometimes with their lack of flexibility. If I were a Facebook game developer I'd be in constant worry of things like this where Facebook could bring down a hammer and force me to completely change fundamental things about my game, it's a "you live under my roof, you live by my rules" approach where Facebook is the father and the developers are angsty teens.

Edited 1 times. Last edit by Thomas Dolby on 26th January 2011 1:46pm

Posted:3 years ago

#10
Up to now everyone have been able to launch games on FB and reach an audience of hundreds of millions of people. Without having FB take a cut of that business.
Up to now FB income has been for game ads, the price of ads constantly increasing.

Now it's a percentage of virtual currency sales. No problem there. Compare with having a gamestore on the main street of your city. Of course the landlord want you to pay monthly rents, and of course your business model is built on need to pay for the services provided by FB.

Question is what do the landlord provide in return, except access to 600 mill people half of which play games? We know about the Non-existing security on FB, as well as a few other things needing improvement: - anyone taking a closer look at FB will see a rickety construct randomly built by angsty teens.
- experienced devs can be fathers and partners providing much needed guidance.

Devs as paying partners can ensure FB shapes up to be an interesting game platform in the future.

Posted:3 years ago

#11

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