Ronnie05's Blog

Facebook Credits: Gathering Momentum

Posted in Social context, media and advertising by Manas Ganguly on November 15, 2010

Facebook and Apple (notably) have a online payment skirmish lined up next in the scheme of things. At stake for both these companies is the upper hand in crucial ‘points of control’ across the Internet Economy, Online Payments. While I have covered Facebook credits in two of my earlier posts, this post is to profile the continuum in FB Credits program. I would also be featuring Apple’s efforts in mobile based payments in a later post.

Facebook will generate more than $1 billion in sales from virtual goods this year, and approach $2 billion next year. Facebook had introduced Facebook Credits as a enabler of online transactions. Currently, there are more than 200 games and applications from 75 developers that accept Facebook Credits for those virtual goods, including 22 of the 25 most popular social games.Facebook credits can buy virtual goods from more than 200 applications on the Facebook platform, like special crop seeds or enhanced tractors in the otherwise free-to-play social game FarmVille. Credits have now moved into the physical world as well. Recently, Safeway Stores joined Target, Best Buy and Walmart in selling Facebook Credit gift cards, just in time for them to become a stocking stuffer for the onrushing holiday shopping season. Facebook is ramping up its repertoire of services which accept Facebook credits and features the following currently

• Zynga: Farmville
• Electronic Arts: Pet Society, Restaurant City and FIFA Superstars
• Family Tree: Non Game Apps
• Hallmark Social Calendar: Non Game Apps
• Stand up-to Cancer: Charitable organizations
• Nothing but nets: Charitable Organizations

Facebook Credits also have the potential to become a universal online currency that crosses both applications and country borders, not to mention a multibillion-dollar revenue source for Facebook, which takes a 30 percent cut of each transaction. future currency used by publishers of digital content like news and video. Facebook is only taking baby steps. However the potential of Facebook Credits is far from being properly and fully understood. As Facebook Credits increases in usage, Facebook will begin to look and feel like its own economy. FB is slowly expanding its list of developers who can “just plug into Facebook Credits” and not have to worry about creating their own payment system. Social gaming is just the first industry to be affected, but a number of verticals will break through

Airline tickets or other big-ticket purchases may not be practical for Facebook Credits. But news site publishers, for example, could use Facebook Credits to get readers to buy access to an important story or a special video. And music is a very social phenomenon. iTunes has tasted enormous success in the micro-payments space to sell 99-cent songs on iTunes at a time when downloading songs for free was all the rage. Facebook Credits account is charged for the value of a virtual item that in real currency might cost only a few cents each.

As Facebook becomes a bigger part of the user’s shopping and purchasing activities as well as an even greater part of their communications activities, Facebook credits will ascend in number of transactions and acceptance by more and more vendors, publishers, developers and e-commerce platforms.

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  1. […] there is this talk of Apple trying to create an online Virtual currency much like the Facebook credits for the Application and iTunes purchases. There are significant volumes in there for Apple and […]


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