4 reasons we will see 100,000+ apps on Facebook in 2010

Casual Connect Europe in Hamburg brought many leanings for me, but I think the most profound was that the Social Gaming space will explode in 2010.  Here are 4 reasons why:

1. Casual Gaming is on the express train to Social. Every Casual Gaming company at the conference is either boarding or is already on the train to social gaming, and this train in moving fast, because social gaming is eating their lunch.  These are guys from all over the world and in every game genre. Huge.

2. iPhone games will be Facebook games. There are 140,000 iPhone games on the AppStore as of this writing. There are 4 categories of product in the iStore, where the top 25 placement results in reasonable sales. The other 139,900 applications are not making any money. There will be a gold rush of iPhone guys into the space.

3. Facebook is a platform that lets you promote your product! Rather than hope to be in the top 25 on the AppStore, here’s a platform where you can take control over your application’s destiny by buying ads with Facebook.

4. Technical barrier is low.  Integrating with Facebook is no more difficult technically than building an iPhone Game or creating a Flash Casual Game. In fact, it’s probably a lot easier with the introduction of Facebook Connect.

With both the Casual and iPhone Gaming industries all starting to do social, and given the relatively short dev cycles, I expect a gold rush. At the very least, we’ll see 100,000 apps integrating social features. There really is no reason not to.

The big question is, will they know how to monetize on Facebook? Backstage can help.

5 takeaways from the Quiet Profitability Panel at Casual Connect

This week I spent some time in Germany, attending Casual Connect Europe in Hamburg, where I spoke on a panel titled Quiet Profitability about our company Backstage Games as well as moderated a discussion between these fine gentlemen:

Toby Beresgford – Founder of Nudge Social Media
Jens Begemann – Founder and CEO of wooga
Alexei Kostarev – Founder and Head of Production of I-Jet Media

I had been looking forward to this discussion for quite a long time, helping David Nixon of I-Play organize it.   Let’s just say the panel did not at all go as I had planned, but I was stoked that people found it interesting and informative.  Here are some key points that were highlights for me and I think they deserve a mention:

1.  ONE great game is better than TEN good games.  Jens Begeman, the creator of Brain Buddies on Facebook has certainly illustrated the concept of concentrating on your core product on a single platform.

2.  If it's tough to win globally, win locally.  Alexei Kostrarev has been able to dominate the social space in Russia, where I-Jet Media today owns about half of all revenues from social gaming – certainly a formidable result.   If you can’t be Zynga, be the Zynga or your local geography.

3.  Brands are coming to social networks in a big way.  Nudge Social Media connects brads with social audiences and has seen excellent growth this year.  I would expect focusing on branded experiences to be a growing niche in the social space.

4.  Quick Play Pays.  This was noted by me through our experience at Backstage.  Complex game dynamics confuse the hyper-casual social network players into indifference.  Quick reward loop has a better potential for monetization.

5.  Content moves the needle.  As the industry continues to converge on Virtual Goods as the business model, fresh content is the key lever to move the revenue needle.

Casual stroll into Social Gaming

Recently, I have had the pleasure of working with one of the top Casual Gaming companies, co-developing several exciting titles.  As many others, this company is looking at Social Gaming as a new 'fad' which may create some side revenue by driving users from Facebook and MySpace over to their own portals.  Unfortunately, this approach really misses the bull's eye of Social Gaming potential.

Social Games Revenues in 2009 exceeded $700 million and will almost double in 2010 to a staggering $1.3 billion (yes, billion with a B).  This revenue is primarily achieved though selling in-game virtual goods and, to a much smaller extent, advertising.

The big POW is that Facebook users monetize very well, but they do so within the comfort of the environment they choose and with a game they like.  Getting them to play is the hard part.  Once that's done, monetizing is relatively easy.  Whatever you do, do not take them out of their comfy sandbox by driving them to another site.  Taking a player out of the game and out of the social network to convert them to a game on your portal is a big waste.  The user, which was so close to monetizing, is now in a new environment with an altered product proposition.  You have to redo all the work of getting them comfortable, getting them to play, getting them to come back.

Leave players where they chose to play.   Find ways to monetize them right there and then.