Zynga Keeps Focus On Social Gaming; Abandoning Real Money Games in the US

31 July 2013

It’s hard to make money farming these days, even whether it’s in the Corn Belt or in Farmville.

In a recent analyst conference call, Zynga’s chief operations officer, David Ko, announced that the company has decided to focus its U.S. endeavors on its social gaming and casual audience core, and not invest in real money online gambling. While Zynga Poker remains the company’s income strong horse, it’s numbers have slipped this year for reasons ranging from increased activity by competitors to “illegitimate credit card activity” on the web.

Zynga had previously applied for an online gambling license in Nevada, and it has announced that it would no longer pursue that venture. “Zynga is making the focused choice not to pursue a license for real money gaming in the United States,” Ko told analysts last week. “Zynga will continue to evaluate all of its priorities against the growing market opportunity in free, social gaming, including social casino offerings.”

Said Ko on the analyst call, “We must stay focused on our priorities,” and he reiterated Zynga’s priority as being social games. He attributed the popularity of Zynga Poker to the growth in the “casual” end of the market, not the real-money, online gambling end.

Zynga has been through its share of dark woods in the past year, and has tried several different ways to shake things up and smooth things out to both appease its investors and its players. The most recent chance is hiring Don Mattrick, the ex-Xbox boss, as its new CEO as of July 1st. Founder Mark Pincus now serves as chairman and chief product officer.

One can only hope that Mattrick, who also held the reigns at Electronic Arts, can help steer Zynga through what Mattick has already predicted to be a rocky ride, stating next six to twelve months will some of the most volatile as the company gets back to basics. In the meantime, according to a VentureBeat article, Zynga’s reported users have dropped to nearly half of what they were a year ago (72 million down to 39 million). This drop could be too much for some nervous investors, but could also pay off nicely for those who stick around. Assuming, of course, that Zynga keeps moving the stick forward.

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