Are Facebook Credits and the Apple App Store on a Payments Collision Course?
Just a quick thought that’s been on my mind of late. I’m trying to figure out how two major changes I see in social and mobile games will be reconciled:
1. Many social games developers are gradually beginning to embrace deeper integrations of Facebook Credits into their on-Facebook social games. In a number of cases, developers are getting rid of their own intermediate cash currencies and just selling all items in FB Credits denominated prices. I’m not sure this is a smart thing to do, but I know a number of folks who have decided to go down this road. The decision as to whether or not this should be done probably warrants an entire blog post or Quora thread of its own.
2. Many social games developers are beginning to eye mobile and think seriously about how to either port their (or someone else’s) existing social games to mobile platform, namely iOS and Android. I can say confidently that social style games on iOS are monetizing well and I believe the same will be true of Android at some point. The tricky thing, though, is that the iOS payments environment is tightly managed by Apple. Right now, FB credits are not an accepted way to pay for in-app purchases for games or apps in the app store.
How is this all going to work out? As more social games developers continue to integrate more deeply with FB Credits as the sole in-game currency, how will they handle the move to mobile platforms? Obviously, things would be simple if Apple and Facebook were to do a deal whereby users could use FB Credits as a way to pay for in-game items in social mobile games. It’s clear to me that such a deal would be a huge boost to Facebook Connect as a mobile login and payment solution, but I’m not sure it would be a smart deal for Apple. Apple already has 150+ million (and counting) payment-enabled accounts that work for in-app billing. Unless the attach rate for FB Credits is 25% of the 600 million registered Facebook users (and I doubt it is), there’s clearly more for Facebook to gain than there is for Apple.
I’m curious to see how this all plays out. I can see a lot of advantages for developers who want to stick with FB credits as their sole payment solution on all games on all platforms. Problem is I don’t see what’s in it for Apple.
But you know who should seriously consider this? Google. They’re working on a good payment platform for Android, but they don’t have the same installed base of payment-enabled users that Apple has. And while a deep integration with Facebook might hurt Google’s internal efforts at social functionality, I’m sure it would be welcomed by developers looking for more ways to get distribution and accept payments.