Facebook Inc. (Nasdaq: FB) is building on the Israeli gaming market: five of the developers of Facebook's ten largest social games in the EMEA (Europe, Middle East and Africa) come from Israel. Herzliya-based Plarium Ltd. is one of the ten fastest growing games companies on Facebook worldwide.
These achievements today brought Facebook to Israel for the second time in six months to find the next game hit, and to send a clear message to Israeli gaming developers: We want you.
"Israel is a very advanced country for gaming on Facebook, Facebook head of European platform partnerships Julien Codorniou, who is heading the company's gaming developers conference, Game On. "The last time we held this conference in Israel, 500 programmers came, making it our biggest event outside the US."
Most prominent Israeli companies in the field are engaged in the gambling sector, which Codorniou attributes to the success of Playtika. "People saw its success and were inspired to found companies in the field," he says. He classifies their activity on Facebook as "social casino" - bets for fun, not money.
Nonetheless, in the past year, Facebook opened its gates to betting for real money, albeit only in the UK and only through three companies, including 888 Holding plc (LSE:888). "Although many British people love to bet, it's premature to say whether this will be a success. I believe that most of the money that these companies will make will still come from the social casino," says Codorniou. He declined to answer whether Facebook would expand betting to other countries permitting online gambling.
Codorniou looks beyond gaming on Facebook, and points to Plarium as a company which symbolizes the industry's future. "Casual games are a big hit, but we'll see that the next thing will be hard core games, such as Plarium's 'Total Domination' and 'Stormfall'," he says, adding that a game like "Stormfall", which did not exist six months ago, is now one of the 20 fastest-growing games on Facebook worldwide.
Until one or two years ago, Zynga Inc. (Nasdaq: ZNGA), the developer of Farmville and other games, was a byword for games of Facebook, but Codorniou says that it is now just one of the companies in the field. "The situation has changed. Today, 70% of growing gaming companies on Facebook come from Europe," he says.
Facebook is definitely a gaming powerhouse, with more than 250 million players a month, 11% more than in 2012, making it a larger gaming platform than all games consoles combined. 130 Facebook games have more than one million active players a month, with the average gamer playing more than three games a month.
In view of the website's success, Facebook current target is mobile. Codorniou says that for a social game to succeed it must first go through Facebook's online platform, and then to its mobile platform, and only afterwards to Apple Inc. (Nasdaq: AAPL) and Google Inc. (Nasdaq: GOOG) app stores. But what might be perceived as competition against Apple and Google is actually cooperation.
"We want to be one of the biggest traffic creators for the app stores," admits Codorniou in commenting on the possibility that mobile games developers should promote their wares on the Facebook app by a direct download key. "23% of the time people in world spend on mobile is on Facebook. There is no doubt that gaming companies want to be part of this share," he says, adding that 80% of the top ten Android and iOS apps interface with Facebook accounts.
Published by Globes [online], Israel business news - www.globes-online.com - on March 12, 2013
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