Gaming Veterans See More Facebook Cons Than Pros

Apparently Facebook has a lot work to do to satisfy gaming gurus: A very heated debate at the L.A. Games Conference revealed more negative opinions about the social network than positive ones among audience members and panelists alike.

This all arose during a panel of industry veterans — Alex St. John, president and chief technical officer of Hi5; Geoff Cook, chief executive officer of myYearbook; Mari Baker, president and chief executive officer of PlayFirst; Rick Thompson, chairman and co-founder of Idle Games; and Mike Vorhaus, president of Magid Advisors, moderating it all.

Alex and Geoff argued against Facebook, Mari and Rick argued for Facebook as a gaming platform. Mike moderated them in 15 minutes of debate team style arguments. Each debater was given 3 minutes to argue their side, and then 1 minute for rebuttals of the other side’s arguments. An audience vote was taken before and after the debate to determine the effectiveness of each side’s arguments.

Alex set a confrontational tone prior to the debate by saying to the audience: “So you all want to be Facebook’s bitch? We’ll take care of that.”

Highlights from the Debate


Mari Baker
President & CEO
PlayFirst

“Facebook is the place you have to be.”

Mari’s “Pro” Argument:

Facebook has the growth, momentum and opportunity – it is where you will get the best ROI on the games that you develop.

Facebook has 200 M active game players. Facebook has a growing, massive audience and is proven as great platform for gaming

Facebook has grown 76% to 90% of market share in social networking. Are you really going to target the remaining 10% market share and build a business on that?


Geoff Cook
CEO
myYearbook

“We think Facebook has the wrong social graph for games.”

Geoff’s “Con” Argument:

Facebook is the most important site in world. Facebook is the social plumbing of the web. But don’t confuse Facebook’s success with Facebook being the right platform for everything we do online.

Facebook’s social graph is very specific – the people you know in real life, but that’s not necessarily the people you would want to play games with. Facebook’s social graph is not wide enough to really accommodate game play.

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Rick Thompson
Chairman & Co-Founder
Idle Games

“Facebook is a high fidelity, reliable social graph for social games.”

Rick’s “Pro” Argument:

Facebook is the social graph. Facebook is where friends are connected and are connecting.

People buy the most virtual goods when being generous with their friends, not strangers. People spend the most money to enhance their game play when looking “awesome” in front of their real friends.

Think of Facebook’s moves to control games like Google’s “Panda Update” to its search algorithm, when Google penalized “content farms” because those kinds of sites were hurting Google’s search user experience.


Alex St. John
President & CTO
Hi5

“Facebook is an accidental game platform”

Alex’s “Con” Argument:

Facebook is still small fraction of revenue in online games. And the game industry has 50B in revenue overall. That makes Facebook still a “pimple on a flies ass”.

I’ve seen accidental gaming platforms arise. They come and go. Up until 2008, Yahoo! was the #1 game channel on earth. But new companies like Big Fish and Wild Tangent won the market – because they specialized in online casual games.

For Zuckerberg, games are parasites that invaded his social network. After games sneaked in, Zuckerberg turned off viral channels that made games successful. Games are a nuisance to Mark.

Rick Thompson’s Rebuttal

Sure, Facebook did not design for games. Games fortuitously sprang out of the launch of an open app marketplace.

Are games a nuisance? Hardly. Games are responsible for the majority of Facebook’s revenue and will be for the next 5 years.

With Facebook Credits, Facebook will get 30% of virtual goods revenue. Facebook will give games a lot of real estate as a result. And Facebook sells a lot of ads to game companies.

Facebook will direct a lot of revenue to themselves by supporting the game industry.

Alex St. John’s Rebuttal

Facebook is not friendly to game companies. (Alex then waved press clippings in air). Look at what is happening to major game companies: “Facebook disables all LOL Apps”… “Zynga gunning up for war against Facebook with Zynga Live”.

You can’t build a huge, sustainable business on a platform where they can ban you and shut you down.

Mari Baker’s Rebuttal

Was the PC designed as a platform just for games? Hell no!

Was the iPhone designed as a platform just for games? Hell no!

Are there 100s of millions of games played on the PC and iOS? Hell yes!

Microsoft, Apple and others all shut people down. It’s not just a Facebook thing.

Geoff Cook’s Rebuttal:

All 3 pillars of game success on Facebook are increasingly difficult:

1. Virality: games can no longer publish to feed stories.

2. Cross promotion is being restricted.

3. Advertising: the cost of acquiring users is only going up.

The open web is a better place to build a games business.

Debate Summary

So, The Cons Really Won?

When I say the “cons won”, I’m talking about audience votes before and after the debate. The cons went from 5% to 10% of the room – votes against Facebook increased 100% from 15 to 30 people out of 300.

Kudos to Alex and Geoff for successfully arguing against Facebook. I think they won because they struck a chord with the audience of game executives who control destination sites, game properties and media companies – - all of whom don’t want to cede control of their businesses to Facebook.

Let’s be clear though: Rick and Mari successfully argued Facebook’s merits. The vast majority of people walked away thinking Facebook is a great choice for developing a games business.

Readers, what do you think of Facebook as a gaming platform: Pro or Con?

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