Social Gaming Network acquires Facebook apps to bolster team, traffic

Eric Eldon | April 16th, 2008




Like any real market, when a new genre of Facebook applications starts getting popular, their developers start banding together. The latest example is happening among social gaming app developers: Category leader Social Gaming Network has bought developer outfit Esgut (creator of Entourage, Superlatives, and Text Twirl), as well as Facebook applications Oregon Trail, Nicknames, Friend Block and Free Gifts.

Zynga, SGN’s archrival, bought CLZ, the developer of a group of Facebook gaming applications, in February, which at the time added four hundred thousand daily active users to its existing base of one million daily active users. SGN has 66,425,391 total installs of its own games to date, while Zynga has only about half that (33,144,029), if you believe Facebook app analytic service Adonomics’ numbers. However, Zynga’s user base appears to be far more active — 1,806,718 daily active users versus SGN’s 1,439,737. See the Adonomics table above for more, including its current valuations for each company.

Both companies are not only buying up games, they’re trying to develop ad networks that bring in independent game developers. These are cross-promotional ads, where you’ll be playing a game on one app, and see an ad for another game app — an app that’s also a member of either SGN’s or Zynga’s network.

Many have expected social games to explode on Facebook as developers better understand how to tie in the often-complex features of a game into Facebook users’ behavior on the site. 

Consolidation has already happened in easier-to-create categories, including among general-purpose app companies, and analytics and ad companies. Examples: Within the first days and weeks of Facebook’s developer platform launch last May, top Facebook app companies RockYou and Slide bought up a number of smaller applications. Both companies understood that they needed to grow big as fast as possible to capture the general market. A couple months later, the same thing happened among Facebook statistics applications. Appsaholic was bought by social ad network Social Media and became its analytics service. Appaholic, a similarly named rival, was bought by and became part of Adonomics, the analytics service mentioned above, that’s also an ad platform.

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  1. April 25th, 2008
    10:14 am

    Creators of Facebook app Friends For Sale raise round, not for sale » VentureBeat said:

    [...] San Francisco-based company is not for sale, even though other social game developers have recently been consolidating under market leaders Zynga and SGN. It has just raised $4 million from Lightspeed Venture Partners. [...]

  2. May 13th, 2008
    9:40 am

    SGN, on quest for social gaming revenue, raises $15 million » VentureBeat said:

    [...] In total, SGN-owned games have been installed a total of more than 51.5 million times, representing a total of nearly 40 million unique Facebook users, according to chief executive Shervin Pishevar. In this sense, it is larger than Zynga, which has 43.3 million total installs. On the other hand, SGN today has more than 800,000 daily active users on Facebook, according Adonomics, down around 200,000 daily active users from a month ago. Then, before it incorporated Esqut, it had more than one million. [...]

  3. May 18th, 2008
    4:16 am

    Facebook Apps, Another Perspective « On Shayan’s Mind said:

    [...] Social gaming seems to be the only truly new activity category when it comes to successful applications. It was basically ignored by (or unknown to) social networks until Scrabulous and Friends for Sale came into the picture on Facebook. This category now is rightly so getting plenty of attention from the venture community and entrepreneurs. [...]