Are crises predictable? That's what most economists are thinking about these days. The great Hyman Minsky spent a lifetime building a model of macroeconomic crisis, striving to do exactly that. I spent an afternoon building, presented for you here, a tiny model of microeconomic crises: how industries crash and collapse. Our subject? Why media just might be the new Wall Street.
Who is Kiva’s biggest competitor? If you rattled off a list of non-profit-centric startups, the micro-lending site’s President Premal Shah would tell you that you’re dead wrong. Try Zynga, the gaming behemoth that has given rise to Farmville and Mafia Wars and other disturbingly ubiquitous internet classics. What does virtual fertilizer have to do with micro-finance? Shah says a lot: It’s a never-ending fight for eyeballs and discretionary income.
These are interesting times in the social gaming industry. Two weeks ago Disney acquired Playdom, and last week Google acquired Slide. Just like that, two of the largest social game publishers have become part of larger companies. This activity all comes on the heels of EA’s acquisition of Playfish late last year. Social gaming, as a category, has grown incredibly quickly, becoming one of the dominant drivers of usage on Facebook, and an increasingly core component of people’s entertainment. This growth represents a real threat to other forms of entertainment, and has precipitated the three deals that we have seen so far.
Viacom Inc.'s MTV Networks bought social gaming company Social Express Inc., marking its first move in a space that's helped sites like Facebook Inc. reel in users. MTV, which owns online gaming sites such as Shockwave.com, will create games with original content as well as shows and characters from its networks, according to a statement today. It also plans to start a platform for independent game developers.
In 2002 a startling announcement was made: sales of video games had finally surpassed the movie box office in the U.S. Over the past two years, games have catapulted to an even more impressive level. Farmville, a game that allows players to tend to a virtual farm with their friends in Facebook, is currently played by 70 million people per month. That's one in four Americans. Kleiner Perkins, the legendary venture capital firm, announced that Zynga is the fastest-growing investment they've ever made. To give this some context, consider that Kleiner was the first investor in Google. I believe this trend represents something much bigger than just explosive growth in the gaming industry. For years, many of the world's smartest people, from psychologists to behavioral economist to marketers, have been studying what motivates people to perform specific actions. In marketing terms, the most important of these is the purchase impulse. Today, the research on buying behavior is beginning to be reframed in terms of gaming mechanics.
Zynga, the creators of the blockbuster social game FarmVille, has raised another round of funding: $147 million, seemingly all from Japanese telecommunications and media conglomerate Softbank. According to Bloomberg Businessweek and Nikkei English News, Zynga and Softbank have joined forces to spread Zynga’s wildly successful suite of social games throughout Asia. The company will focus on mobile devices — a smart move, considering that many Japanese consumers use their mobile phones as their primary access point to the web.
With Zynga, creator of FarmVille, recently valued at $4 billion dollars and established game companies such as Electronic Arts jumping on board, games are becoming a legitimate interactive social channel for the masses. Why Would Your Brand Consider Partnering With A Social Game?
Contrary to popular belief, Twitter wasn’t the only story of 2009. Facebook skyrocketed to over 350 millions users in 2009 and continued its rise to global pervasiveness becoming one of the top visited sites on the Web. As aspiring digital anthropologists and sociologists, we thoroughly enjoy and appreciate the trending topics readily available for review and analysis on Twitter. On Twitter, trends are defined and shaped by the shared interests published in the form of status updates that suddenly congregate and rally. To close 2009, Facebook assembled its top trends to give us insight into the posting and conversational trends connecting social graphs. Per Facebook’s year end post announcing the top status updates, we’re introduced to Memology, the study of how ideas, events, and information transform into memes and trends inside Facebook.