Palm's new smart phone synchronizes music and photos with iTunes

So the mighty Apple opens iTunes to third parties handset OEMs ! That's quite a step forward from their usual closed approach. So is iTunes ready to be floated as an independent service ?

AP News
May 28, 2009

Palm Inc. said Thursday that its much-awaited new smart phone, the Pre, can connect to Apple's iTunes software and download music and photos just as if it were an iPod or iPhone.

The feature might be unique for a device not made by Apple Inc., though third-party software is available that lets some digital music players masquerade as iPods in iTunes.

Palm Inc.'s new phone goes on sale June 6, with Sprint Nextel Corp. as the exclusive launch carrier. It will be $200 with a two-year contract and a rebate, competing with Apple's iPhone in the market for high-end smart phones. Jon Rubinstein, Palm's executive chairman and former Apple executive, said he didn't worry about objections from his former employer.

"We're trying to make customers happy," he said at The Wall Street Journal's D: All Things Digital conference in Carlsbad, Calif., where he offered a demonstration. "It's a great feature."

Apple spokesman Tom Neumayr declined to comment.

Also Thursday, the chief executive of Verizon Wireless, Lowell McAdam, said his company will carry the Pre within six months, although a Sprint Nextel spokesman said Sprint will be the exclusive carrier until at least the end of the year. Palm's Rubinstein declined to comment.

Google expects 18 Android Phones by Year-End

This is interesting. First of all it seems to imply that vendors can use Android without any pre-condition to integrate any Google services. The other interesting piece is that if a vendor using Android goes for the "Google Experience" scenario which entails pre-loading Google services with the OS and a tigh integration with the Google backened then only are they entitled to use the Google logo ! Google seems rather sure about their brand and the pull for it services !!

Cellular News

May 29, 2009

Google anticipates that there will be at least 18 new Android based smartphones by the end of this year. Google's senior director for mobile platforms, Andy Rubin told a conference that the number might creep up to twenty handsets, but that 18 were certainly under development.

Without naming them, he added that eight or nine handset vendors are currently working on phones which will use the Google backed Android operating system. The figure only applies to Google based Android phones. As the OS is open-source, companies are free to launch Android handsets without any Google approval process.

Although HTC is currently the only company shipping Android phones, Samsung has shown working prototypes which are due to be launched next month. Sony Ericsson and Motorola have also confirmed they are developing smartphones based on the Android OS.

Google is planning to offer three options to handset vendors who want to offer Google applications.

The basic version allows users to download applications onto a clean handset. The second allows handsets to be distributed with preloaded links to services such as Gmail or Google Calendar. The most detailed version will be known as the "Google Experience" and in exchange for tighter experience to the Google platform, will be allowed to carry the Google logo.

It is expected that the majority of phones will be launched with the second of the three options that Google is offering.

Gmail in real-time: Google does the Wave

Billed as "the e-mail of the future", Google Wave is an audacious attempt to reinvent the inbox by blending voice, email, IM, blogs, wikis, collaborative documents, social media sharing, social networking, etc. and combining conversation-type communication and collaboration-type communication.

It's a little bit Twitter, a little bit Friendfeed, and a little bit Facebook all in one service, allowing you to send direct messages to online contacts with real-time replies, share photos or documents, and add or delete members of the conversation as needed.

by Tom Krazit, Webware
Webware
May 28, 2009

When recipients respond to Wave messages, everyone on the thread sees the replies as they are being typed.

(Credit: Google)

Updated 12:28 p.m. PDT with additional comments from Google.

Google is ready to start talking about its answer to demand for real-time--yet organized--Internet communication.

Google on Thursday publicly demonstrated Google Wave for the first time at the Google I/O conference in San Francisco. Billed as "the e-mail of the future," Google Wave is the result of a multiyear project inside of Google to reinvent the inbox, blending e-mail, instant messaging, photo sharing, and perhaps, with input from developers, connections to the world of social networking.

Lars Rasmussen helped lead the development and demonstration of Google Wave.

(Credit: Stephen Shankland/CNET)

Google Wave is an attempt to "combine conversation-type communication and collaboration-type communication," said Lars Rasmussen, who launched the project with his brother Jens after Google acquired their mapping start-up in 2004. The brothers Rasmussen said they were inspired by the fact that two of the most commonly used Internet communication technologies--e-mail and instant messaging--are based on relatively ancient offline communication techniques, namely the letter and the telephone.

The Rasmussens were given the authority to create "one of the most autonomous independent groups we've had at Google," said co-founder Sergey Brin in a press conference following the demonstration. Given the success the brothers had in developing the technologies behind Google Maps, Brin was inclined to "give them the benefit of the doubt" when Lars came to him pitching a bid to reinvent Internet communication.

They came up with Google Wave, which organizes Internet discussions in the trendy stream of consciousness fashion. It's a little bit Twitter, a little bit Friendfeed, and a little bit Facebook all in one service, allowing you to send direct messages to online contacts with real-time replies, share photos or documents, and add or delete members of the conversation as needed.

In that sense, it's not a completely public discussion, nor a completely private one. A user creates a "wave" by typing a message or uploading photos and adding contacts to the wave as they see fit. Other contacts can be added later, and those people can add other contacts to the wave unless the original wave starter forbids new entrants.

"Each person that we show it too, something different resonates as useful" to their way of communicating on the Internet, said Stephanie Hannon, project manager for Google Wave.

At the moment, the functionality is somewhat limited, but Google is introducing Google Wave at its developer conference for a reason: "a lot of this depends on developer uptake," Rasmussen said. The company will release APIs (application programming interfaces) at the conference so that developers can start testing how to build Wave into their own sites, or how to integrate their services with Google's.

Google envisions three types of developer projects using Wave. The first is the most obvious; using Wave as a gateway for conversations that you're already having elsewhere on Twitter, Friendfeed, Facebook, blogs, and other social media sites.

There are plenty of reasons for Google to try to tap into the "stickiness" of various social networks, where users spend obscene amounts of time. And the company thinks that services such as Twitter recognize the value of letting others build a front end into their services: there are dozens of Twitter apps for PCs and smartphones that grant such access without having to use Twitter's own front end, and those apps don't seem to have put much of a dent in Twitter's overall traffic. For starters, Google Wave will allow users to post new items to blogs created with Blogger from within a wave, and see comments and replies within a wave.

E-mail, instant message, wiki, or nanoblog? Wave combines elements from all of these communication methods.

(Credit: Google)

The second category involves creating applications that run within a wave, similar to how developers have used Facebook as a platform to create all sorts of applications. Collaborative games are expected to be among the first applications to appear within Google Wave.

Lastly, Google wants developers to think of Wave as a possible enhancement to an existing workflow within an enterprise. The example Rasmussen used was a bug tracker used by software developers to identify and assign bugs. Bugs could be organized in waves; participants post the new bug to a global wave, then the team leader can assign bugs to individual team members within the wave, and developers can comment on their fix for a particular bug as they are tackled and cleared, all within the same thread.

The software has a long way to go: Google is releasing it as a developer preview on Thursday, and is actively looking for feedback on how it can improve. Sometime later this year Google expects to release it to the general public, but Rasmussen would not commit to a more specific timeframe.

Google also plans to open-source the format at the heart of Google Wave as a protocol in order to let developers build their own waves. The company has not determined the license that will be used to open-source the code, Rasmussen said.

Developer feedback will be crucial toward gauging the impact of Google Wave in a marketplace crowded with similar ideas. For months, Google has been pressed with inquiries about whether or not it plans to buy companies like Twitter or others that specialize in real-time Internet communication, and thus far, the company has demurred.

Now we know why.

Went Walkabout. Brought back Google Wave

Possibly the new avtaar of communication - Google Wave is just as well suited for quick messages as for persistent content — it allows for both collaboration and communication.

The attempt with Wave is to build a new communication model that presumes all existing modes of communication (blogs, wikis, collaborative documents, etc.) as a starting point and build on the same so as to have a single communications model span all or most of the systems in use on the web today, in one smooth continuum.

A "wave" is equal parts conversation and document, where people can communicate and work together with richly formatted text, photos, videos, maps, and more.

Google Blog
5/28/2009

Back in early 2004, Google took an interest in a tiny mapping startup called Where 2 Tech, founded by my brother Jens and me. We were excited to join Google and help create what would become Google Maps. But we also started thinking about what might come next for us after maps.

As always, Jens came up with the answer: communication. He pointed out that two of the most spectacular successes in digital communication, email and instant messaging, were originally designed in the '60s to imitate analog formats — email mimicked snail mail, and IM mimicked phone calls. Since then, so many different forms of communication had been invented — blogs, wikis, collaborative documents, etc. — and computers and networks had dramatically improved. So Jens proposed a new communications model that presumed all these advances as a starting point, and I was immediately sold. (Jens insists it took him hours to convince me, but I like my version better.)

We had a blast the next couple years turning Where 2's prototype mapping site into Google Maps. But finally we decided it was time to leave the Maps team and turn Jens' new idea into a project, which we codenamed "Walkabout." We started with a set of tough questions:

• Why do we have to live with divides between different types of communication — email versus chat, or conversations versus documents?
• Could a single communications model span all or most of the systems in use on the web today, in one smooth continuum? How simple could we make it?
• What if we tried designing a communications system that took advantage of computers' current abilities, rather than imitating non-electronic forms?

After months holed up in a conference room in the Sydney office, our five-person "startup" team emerged with a prototype. And now, after more than two years of expanding our ideas, our team, and technology, we're very eager to return and see what the world might think. Today we're giving developers an early preview of Google Wave.

A "wave" is equal parts conversation and document, where people can communicate and work together with richly formatted text, photos, videos, maps, and more.


Here's how it works: In Google Wave you create a wave and add people to it. Everyone on your wave can use richly formatted text, photos, gadgets, and even feeds from other sources on the web. They can insert a reply or edit the wave directly. It's concurrent rich-text editing, where you see on your screen nearly instantly what your fellow collaborators are typing in your wave. That means Google Wave is just as well suited for quick messages as for persistent content — it allows for both collaboration and communication. You can also use "playback" to rewind the wave and see how it evolved.

As with Android, Google Chrome, and many other Google efforts, we plan to make the code open source as a way to encourage the developer community to get involved. Google Wave is very open and extensible, and we're inviting developers to add all kinds of cool stuff before our public launch. Google Wave has three layers: the product, the platform, and the protocol:

• The Google Wave product (available as a developer preview) is the web application people will use to access and edit waves. It's an HTML 5 app, built on Google Web Toolkit. It includes a rich text editor and other functions like desktop drag-and-drop (which, for example, lets you drag a set of photos right into a wave).
• Google Wave can also be considered a platform with a rich set of open APIs that allow developers to embed waves in other web services, and to build new extensions that work inside waves.
• The Google Wave protocol is the underlying format for storing and the means of sharing waves, and includes the "live" concurrency control, which allows edits to be reflected instantly across users and services. The protocol is designed for open federation, such that anyone's Wave services can interoperate with each other and with the Google Wave service. To encourage adoption of the protocol, we intend to open source the code behind Google Wave.

So, this leaves one big question we need your help answering: What else can we do with this?

If you're a developer and you'd like to roll up your sleeves and start working on Google Wave with us, you can read more on the Google Wave Developer blog about the Google Wave APIs, and check out the Google Code blog to learn more about the Google Wave Federation Protocol.

If you'd like to be notified when we launch Google Wave as a public product, you can sign up at http://wave.google.com/. We don't have a specific timeframe for public release, but we're planning to continue working on Google Wave for a number of months more as a developer preview. We're excited to see what feedback we get from our early tinkerers, and we'll undoubtedly make lots of changes to the Google Wave product, platform, and protocol as we go.

We look forward to seeing what you come up with!

video of the Google Wave keynote presentation is now available:

Posted by Lars Rasmussen, Software Engineering Manager

Apple takes 12% of mobile apps market

I guess with the hoards of folks entering the app store, there is going to be a reality check sooner than later. As we have seen with the case of case of Apple, while the traction has been huge, the actual revenue has not been commiserate given the rapid price erosion in view of the intense competition

Telecoms.com
May 22, 2009 Written by James Middleton

Apple takes 12% of mobile apps market

Application store trailblazer Apple managed to capture 12 per cent of the mobile apps market in 2008, according to figures released this week.

However, industry researcher Strategy Analytics, which carried out the study, said that the iPhone App Store’s value is significantly lower due to intense competition between developers which has pushed down application prices.

While the original App Store’s favourable revenue share for developers has created a tremendous buzz and fostered innovation, resulting in a high volume of downloaded applications, the downside to this popularity is that competition between developers has become fierce and the majority of applications are available for free or very low cost.

“Other handset manufacturers have reacted to Apple’s success by launching their own stores, but in the past it has been the carriers which dominated application distribution. Carriers are now changing tactics, hoping to re-attract developers-leading to a rapidly changing environment where each company category has its own strengths and weaknesses. Apple’s has won the initial skirmishes but the war is far from over,” said David Kerr, vice president of Strategy Analytics.

Indeed, Google has launched its own app store in the shape of Android Market, Nokia has one built on the Ovi platform, RIM has BlackBerry App World and Microsoft’s offering is due to come out later this year.

And the app store frenzy continued earlier this week as Jonathan Schwartz, CEO of Java developer Sun Microsystems, revealed his own plans to get in on the game, on a much bigger scale.

Whereas Apple blazed the trail for the app store phenomenon, targeting around 21 million potential users today, Sun has its eyes on a much bigger prize.

The US software shop reckons Java is installed on around 2.1 billion mobile phones and other handheld devices, and is targeting an active market of about one billion Java users (other devices such as desktops included) around the world with its own app store - the Java Store.

And while the main focus of Sun’s Java store may be the desktop market, with its JavaFX platform, Sun also has a great interest in the mobile space. JavaFX Mobile is a scripting language designed for creating rich content and applications to run on Java-powered devices from mobile phones to Blu-ray Disc players, set top boxes, navigation devices and automobile dashboards. Interestingly enough, Vodafone, the world’s biggest carrier by revenues is a big supporter, and user, of the JavaFX technology in its own Live! services.

As LBS Subscribers Multiply, Sustainable Business Models Emerging

Cellular News, May 12, 2009

The number of subscribers to handset-hosted location based services (LBS) increased in 2008 to more than 18 million. North America continued to be the dominant region, accounting for slightly more than two-thirds of the total market, according to a new study from ABI Research. While navigation continued to lead in terms of total subscribers, two other application areas – enterprise and community (including social networking) – posted the highest year-to-year growth rates.

Developments in 2008 suggested that the industry is undergoing a transition. Traditionally, individual application providers have utilized an API (application programming interface) to grab location data to create an LBS application. Increasingly, a more sophisticated set of location-centric applications are being enabled by collaborations between LBS ecosystem partners.

According to senior analyst George Perros, "While the current, or first-generation, LBS programs provide value to users, this value has been hedged in by their reliance on handset-based GPS positioning (which has restricted the addressable market outside North America), and on network positioning, which has limited uptake due to its lower accuracy in non-urban areas.

In the past year companies have started to gravitate to a different model in which specialized ecosystem players work together to eliminate some of the existing limitations of LBS application development and implementation. "We're beginning to see LBS application providers teaming with wireless security firms and location aggregators," says Perros. The result has been the appearance of LBS applications that can utilize handset location data from a number of sources, relying less on the cellular network. Some of these applications essentially bypass the network operators, which are responding to this trend by launching their own versions of handset application websites.

Little Laptops Could Drive Big Data Usage

A netbook is a small portable laptop computer designed for wireless communication and access to the Internet.

Primarily designed for web browsing and e-mailing, netbooks rely heavily on the Internet for remote access to and are targeted increasingly at cloud computing users who require a less powerful client computer. Netbooks typically run either Windows XP or Linux operating systems rather than more resource-intensive operating systems like Windows Vista. The devices range in size from below 5 inches to over 13, typically weigh ~1 kg and are often significantly cheaper than general purpose laptops at US$ 400, with some even in the US$ 50–100 range under some circumstances.

Webpads/Netbooks are definitely likely to drive both wireless broadband uptake and cloud computing and have a significant impact on carriers data related business models.

Likely to be a fiercely competitive market with handset makers, internet players and IT vendors slugging it out. The battle is potentially more about the OS, as it has larger ramifications over the lone term both for the PC and mobile handset industries, rather than the hardware with stakes already in the ground from Linux, Microsoft (Windows), Google (Android), Apple (Mac OSX) and Nokia (presumably Symian).

Unstrung, May 22, 2008

The cutesy mini-laptops know as "netbooks" are becoming one of the elements set to drive up mobile broadband usage up in the coming years.

A new report from Pyramid Research , called "Mobile Broadband for the Masses: The Case for Bundled Netbooks," finds that Webpads are just starting to hit a growth spurt, despite the economic crisis. About 13 million were sold worldwide in 2008, with 10 million of those sales coming in the second half of the year, notes report co-author Cristiano Laux.

Pyramid believes the trend will continue and is recommending that operators do what they can to support netbook sales. "There is growing evidence that netbooks are catching on with the under-21 crowd; if that trend develops, the adoption rate for netbooks could accelerate even more, which means these cheap and approachable devices could have a huge impact on how network operators make money off their services," Laux adds.

The relatively inexpensive nature of these small laptops also makes them appealing in "lower-income countries" in the Asia/Pacific region, the Middle East, Africa, Eastern Europe, and Latin America. Pyramid believes that netbooks will hit "mass-market shipments" in 2010 as the average price of the mobile PCs falls below $350.

Taken in conjunction with recent research from Cisco Systems Inc., it's easy to see how the advent of more netbooks on cellular and mobile broadband networks could affect carrier data revenues in a positive fashion. A single high-end smartphone generates more data traffic than 30 basic-feature cellphones, while a laptop aircard generates more data traffic than 450 basic-feature cellphones, Cisco revealed recently.

In a world of collapsing device categories, netbooks sit between a full-featured laptop and a higher-end PDA or Web tablet, so it is reasonable to expect that these gadgets will generate a considerable amount of data traffic on a network.

Certainly, carriers like AT&T Inc. have made no secret of their interest in subsidizing netbooks with a monthly data plan. The operator is now offering netbooks priced between $50 and $250 to users that sign on for a two-year 3G data contract.

Meanwhile, vendors like Apple Inc. are also rumored to be getting into netbooks. The iPhone maker is said to be working on a wee netbook of its own.

Google Says Android Is For Building Massive Scale In Mobile For Advertising Play

Advertising is yet the only proven business model on the net and that too with scale (a la Google). However, even large corporations with potential scale haven't yet been able to successfully monetize all their properties (e.g. Google with YouTube and EBay with Skype)

By Tricia Duryee - Thu 21 May 2009

Every once in awhile, I hear someone ask: “What is Google’s true intent with Android?” In an interview with CNet today, Andy Rubin, Google’s director of mobile platforms, puts it pretty bluntly.

For Google, it’s all about extending the company’s dominance in online advertising to the mobile phone. Rubin: “Google’s business model is deep into advertising, and so for Google this is purely a scale of the business, we just want to reach more people, and hopefully they’ll use Google and we’ll get the upside of the advertising revenue.”

The need for scale is also what likely sets Google apart from what Apple is doing for the iPhone or Palm is with the Pre, but makes it more in line with what Microsoft is doing.

Rubin: When you control the whole device the ability to innovate rapidly is pretty limited when it’s coming from a single vendor. You can have spurts of innovation. You can nail the enterprise, nail certain interface techniques, or you can nail the Web-in-the-handset business…What we’re talking about is getting out of a niche and giving people access to the Internet in the way they expect the Internet to be accessed. I don’t want to create some derivative of the Internet, I don’t want to just take a slice of the Internet, I don’t want to be in the corner somewhere with some dumbed-down version of the Internet, I want to be on the Internet.”

So, should you be afraid of Google taking over the mobile space? Rubin essentially says if they are successful, it will be the consumer’s choice. “We’re confident enough in our advertising business and our ability to help people find information that we don’t somehow demand they use Google. If somebody wants to use Android to build a Yahoo phone, great.”

Sun targets Java app store at 1B users

Another day and another app store but this one looks interesting because of the Java reach and Sun's ability to overcome the pre-load barrier by having the ability to communicate with end users via push updates/upgrades (which will allow it to promote the app stores and apps).

The challenge for Sun however will be consumer recognition and acceptance of the Sun brand and B2C support.


GSMA Mobile Business Briefing

May 22, 2009

Sun has unveiled plans to launch an application store based on its Java technology that it says will allow developers to target an estimated 1 billion PC and mobile phone users. Known currently as Project Vector - though likely to be renamed 'Java Store' - the service will launch officially at Sun's JavaOne event in San Francisco next month. Writing on his official blog this week, Sun CEO Jonathan Schwartz described Vector as "a network service to connect companies of all sizes and types to the roughly 1 billion Java users all over the world [and] has the potential to deliver the world's largest audience to developers and businesses leveraging Java and JavaFX." According to the company's figures, Java is used in over 800 million PCs, 2.1 billion mobile phones, 3.5 billion smart cards and various other products such as set-top boxes, printers, Web cams, games and car navigation systems.

Schwartz said the project was aimed at building a more formal business around Java's vast distribution network by making it available to the entire Java community, not simply one or two search companies on yearly contracts, which has been the case to date. He added that the app store will work by candidates submitting applications (via a website), which will then be evaluated by Sun for safety and content, and presented under free or fee terms to the Java audience via Sun's update mechanism. Over time, developers will bid for position on the storefront. "As with other app stores, Sun will charge for distribution - but unlike other app stores, whose audiences are tiny, measured in the millions or tens of millions, ours will have what we estimate to be approximately a billion users," Schwartz concluded. By comparison, Apple's pioneering App Store recently passed a 1 billion application download milestone, but has an installed base of only 21 million iPhones worldwide.

Acer to Release Google Android Phone

The emerging trend seems to be clear (given that Asus and Dell have also announced Android handsets) - PC brand (in addition to Google), distribution channel, support and offline promo leverage + Google OS, apps (which already have PC based online traction) and online advt. strength. Next logical step for Google would be to extend Android to PCs to make it a tight integration (they already have it coming for netbooks).

A further hypothetical and rather far fetched extension (though I personally believe its very likely in the next 2-3 years) is Google making Android device and vendor agnostic and offering the option via its Netbook/laptop/PC OS for folks to reflash phones with other OS with Android.

Unstrung

May 21, 2009

Acer Inc. said it would be releasing this year a smartphone that's powered by the Google (Nasdaq: GOOG)-backed Android operating system.

The PC maker jumped in the smartphone market this year with its Tempo line of devices. The company is looking to capture up to 5% of the growing smartphone market within five years by offering handsets that are free with contract or have a low price.

The majority of Acer's smartphones will run Microsoft (NSDQ: MSFT)'s Windows Mobile, but at least one will use the Linux-based Android, according to the head of the mobile phone unit. Aymar de Lencquesaing told the Reuters Technology Summit that the company is aiming to have the device on the market by the end of the year.

@ EconSM : How Twitter Plans To Make Money From Search, Carriers and Content

Twitter is definitely rolling out a host of pilot initiatives in an attempt at monetisation.

By Tameka Kee - Thu 14 May 2009

We’ve gotten hints about Twitter’s business model from its founders, its backers and random speculators—but Kevin Thau, Twitter’s director of mobile business development, gave EconSM attendees a more tangible picture of the startup’s plans for a three-pronged revenue stream: It’s about search, carriers and content.

Thau joined Twitter in mid-January, since then, he said the company has brokered about a dozen business deals with partners like mobile service providers, handset makers and even media companies. MarketWatch’s EIC David Callaway grilled him on the details:

—Search: Twitter’s real-time search capabilities have been well-documented (so much so, that even Google has stepped up its real-time search features); Thau said the startup will monetize its search traffic “in some way”—though he didn’t elaborate.

—Carriers: Much of Twitter’s traffic comes from mobile: both through data plans and via SMS. Thau said getting some sort of a cut of the carriers’ data business wouldn’t be a huge source of revenue—but definitely a portion. Twitter’s also working on handset deals that would “integrate the service” into certain devices right out of the box.

—Content: MTV is sharing ad revs from an upcoming show with Twitter, so will we see an influx of similar content deals? Thau said yes—which is partly why they hired a new exec to focus on the media/entertainment business. “The media industry is looking for ways to stay fresh and interactive; you’re already seeing CNN and ABC Nightline using it, and we think more media companies will start using Twitter as a utility.”

Twitter Gets Business Model For Third Birthday
By James Quintana Pearce - Mon 23 Mar 2009

Twitter has turned three years old, as noted by VentureBeat, and while last year was largely about fixing the service, this year will likely be about finding a viable business model. And, it seems Twitter has some prospects not even a day later. Salesforce.com has launched Salesforce CRM for Twitter, which lets companies search, monitor and join conversations taking place on Twitter—presumably about their products.

Twitter doesn't seem to get any revenue from that, but the Twitter Blog notes: “Twitter is a simple and open communication service made more interesting by the many different uses people invent. Applications, projects, and integrations such as Salesforce CRM add to an ecosystem which continues to grow around Twitter delivering variety, relevance, and most importantly, value to users. This ecosystem helps make Twitter successful.”

Where Twitter is generating revenue is via ExecTweets, which collates the tweets from a number of executives. This is run by Federated Media and sponsored by Microsoft. Federated Media is sharing some of this sponsorship revenue with Twitter, according to VentureBeat: “We can't talk about terms of the deal, but we did want to share some of the revenue with Twitter to support them,” Federated Media's John Battelle said. There is also a plan to make revenue with the service beyond Microsoft's sponsorship. The site lets you vote for tweets to send them to the top, and has lists of Top Links, Hot Topics, Most Popular and Recently Recommended.

And there's no surprise, that Twitter continues to grow after three years...“Visits to Twitter have increased 1,382 percent since last year - from 475,000 unique visitors in February 2008 to 7 million in February 2009, according to Nielsen” reports PC Mag. Nielsen also has some other stats about Twitter: “Adults between the ages of 35 and 49 comprise almost 42 percent of the site's audience - and about 62 percent of them are accessing the site from work. The average user hits Twitter.com about 14 times a month and spends about seven minutes on the site.

In January, about 735,000 unique visitors access the site through their phones and PDAs. In the last quarter of 2008, meanwhile, about 812K unique text messages were sent to Twitter from AT&T and Verizon cell phones.” Big companies are starting to note the uptake—PaidContent has a post on mainstream companies incorporating the service into their products.

Mobile Social Networks Compete With Their Big Web Competitors?

Mobile phones are definitely going to drive the next phase of growth for social networking with the camera, GPS and phonebook likely to enrich and enhance the experience

By Joseph Tartakoff - Thu 14 May 2009

Correction:

Facebook and MySpace are going full force into mobile social networking with their free apps. MySpace says that 35 percent of its mobile traffic now comes from mobile apps, up from less than 10 percent a year ago. at the EconSM conference, representatives of various mobile-first social networks said that Facebook and MySpace’s forays hadn’t dampened their growth and that they don’t believe it will.

Why?

—International opportunities: “I think when you think globally there is a real opportunity ... to take share,” said Shawn Conahan, the founder of Intercasting. A “fair number of people” around the world have never seen MySpace or Facebook, he said. Plus, many are not familiar with PCs, while they do have experience with phones.

—Differentiated experience: Although Facebook and MySpace may be pushing their mobile apps, it’s not what they are focused on. “They could easily eat our lunch if they were focused on it but they are primarily focused on the web experience,” said Jonathan Linner, the CEO of Brightkite. Moreover, there are different expectations with mobile-first social networks. For instance, “There is the expectation you will hear back almost immediately” when you contact someone, said MocoSpace CEO Justin Siegel.

Making money, of course, remains the big problem. None of the mobile social networks represented on the panel are profitable. Some charge, other depend solely on ad dollars. Brightkite, for instance, is bringing in “north of a couple hundred thousand” dollars a month from ads. “We could all be profitable,” but that would come at the expense of growth, Siegel said. Then again, Facebook isn’t making money either.

Report: Apple Has Made $20-45 Mn From Its App Store - Is App Store Model Yet to be Proven ?

Interesting stats on the Apple app store. Inspite of a billion downloads revenues to Apple in the range of a mere $20-45 Mn with the hope of buttressing this at some point by leveraging advertising and micro transaction particularly in games (which account for 25% of all downloads). Does this mean the app business model also remain unproven at this point ?

By Rory Maher - Thu 14 May 2009 06:05 am

When Apple launched its iPhone application store in mid-2008, it pointed out that the company wasn’t looking to make a ton of dough. It was more interested in creating a community that would help drive iPhone sales, a strategy that worked with the company’s launch of iTunes and the iPod player. So far the strategy appears to be paying off - Apple sold almost 14 million iPhones in 2008, but Jeremy Liew from venture firm Lightspeed Venture Partners has crunched the numbers and calculates that the apps have earned Apple a modest $20 - $45 million. Here is how he gets there:

—After surveying app developers and others in the industry Liew estimated 25 million to 60 million of the billion apps downloaded thus far were paid for
—Using an online survey the median price per app was $2.65
—That equals revenue in the range of $70 to $160 million, of which Apple keeps 30 percent.

The remaining 70 percent ($50 million to $115 million) goes to the developers, which may lead some to ask with that spread between so many developers why are venture funds putting so much money into companies whose only business model is to develop iPhone applications? Advertising, of course. Some estimate that ads either disguised as iPhone apps or placed within them will help increase mobile ad spending by $100 million this year. And don’t forget opportunities for commerce or virtual goods in game applications, which represent 25 percent of all apps downloaded from the Apple store.

COAI India Mobile Subscriber Projections 2009-15

May 13, 2009, COAI

Mobile subscriber projections: 2009 – 2015
The widely used S-curve derived from Gompertz model has been used to predict the mobile density and hence the subscriber base till the year 2012.

Gompertz function, named after a renowned mathematician, Benjamin Gompertz, is a mathematical model for a time series, where growth is slowest at the start, peaks in the middle and again slows at the end of a time period.

The Gompertz model has been widely used and is found to be more appropriate for projecting the growth of mobile services, especially in developing countries.

This is so, because, with Mobile phone service, the take-up is initially slow because of high entry cost in the early years, followed by a period of rapid growth, and then eventually there is a phase of slowing of uptake as saturation level is reached.

A reputed academic institute has done a study projecting mobile subscriber base using the Gompertz model. COAI has further worked on the same and has finetuned to factor in the actual subscriber base as on December 2008 and the growth in the first quarter of the present calendar year.

The ‘adjusted S curve’ gives a projection of 492 mn total mobile subscribers by Dec 2009 which seems to be pretty accurate keeping in mind that the industry has already achieved 392 mn mobile subscribers as on March 09.

As per the projection, the mobile subscriber base is expected to reach close to 900 mn by 2012. Even with the subscriber base of 900 million the teledensity would be just 72.4%. Keeping in mind that there are multiple SIMs as well, the potential for growth of mobile service in India is indeed very large.

Do more with Google Latitude!

Logical evolution to trigger broader community engagement - Sharing your location (captured via your handset) on your online assets and via Google Talk

Google Mobile Blog
May 4, 2009

When we launched Google Latitude a couple of months ago, we were flooded with feature suggestions. One frequent request was to allow you to share your location with even more people and not just your Latitude friends. Today, we're launching two applications that do just that!

* Google public location badge lets you publish your Latitude location on your public website or blog. You can just embed the standard badge -- like this or you can use the KML or JSON feeds directly. Read more about the badge on our Blogger Buzz. When you enable this application, your location will be shared publicly and you will not be able to control who can or cannot see it. For your privacy, you may choose to share your best available location, share only your city-level location, or simply never enable the badge.

* Google Talk location status (beta) lets you share your Latitude location with all your Gmail chat and Google Talk contacts. It will automatically update your status message to your current city as you move, and anyone who can chat with you will be able to see this location status. Of course, you can easily change back to your custom status message at any time.

MySpace Sees Gold at the End of the Mobile Rainbow

Interesting to note MySpace seeing light at the end of the tunnel in terms of monetisation with advertising. Facebook though still hasn't made any similar comment and focus clearly still remains on growth with MySpace now more focused on monetization

MySpace Sees Gold at the End of the Mobile Rainbow

Darryl K. Taft
2009-04-29

MySpace has learned how to monetize the mobile platform and wants to help mobile developers in general figure out how to as well.

MONTE CARLO—MySpace has learned how to monetize the mobile platform and wants to help mobile developers in general figure out how to as well.

John Faith, vice president and general manager of mobile and wireless technology at the social networking powerhouse, gave a talk for developers at the Nokia Developer Summit here and noted that development for the mobile environment has never been so lucrative as it is now and it will only get to be more lucrative as the market for mobile applications increases.

Indeed, by 2012, Faith said the market for mobile content will be worth $45 billion, the market for mobile gaming will be worth $9.6 billion, the market for mobile messaging will be worth $14 billion, and the market for mobile display or brand advertising will be worth $1.3 billion.

"There are many monetization opportunities," Faith said, noting both a subscription model and a branded model. "I encourage you to raise the level of understanding" about advertising and process of driving revenue from various sources, he said. "We're looking into CPC [cost per click] revenue and CPA [cost per action] driven revenue, and in applications coming, in cost per acquisition in application storefronts."

Added Faith: "The opportunity is huge. It is decision time. You have to develop your distribution strategy and technology infrastructure to be complementary to one another. Connected experience is the future."

Faith said in 2008, MySpace saw a growth rate of 450 percent in mobile usage of its social networking platform and the site passed more than seven billion downloads a month via mobile devices. MySpace went from less than 10 percent of its traffic coming from mobile applications to more than 35 percent in the past year. "And we see a trend toward smartphones," although gaming consoles and other devices have played into the equation, he said.

Moreover, although many people expect an application built for a full screen, "We expect in the next two years that 50 percent of our traffic will be coming from mobile devices. In addition, he said he expects even more growth in the space, to the point where mobile penetration will rise from 46 percent in 2008 to 95 percent in 2013 in emerging markets, with China and India leading the way. He said China is adding six million new mobile users each month and India is adding 10 million. And by 2013, 34 countries will account for two-thirds of the mobile market, growing from 2.1 billion users today to 4.3 billion in 2013.

"When developing your product, think of what is going to drive users to come back and use the product again and again," Faith said. "Use metrics reviews to drive product. Don’t fall prey to the long tail."

Faith said for MySpace, 32 percent of the mobile users are visiting the site to address their profiles, 19 percent come to read messages and another 19 percent come to send or access photos. Meanwhile, 12 percent of users visit MySpace to send messages, 7 percent visit to add profile comments, 4 percent update their status or mood, 4 percent do bulletins, 2 percent do searches, and 1.4 percent are making friend requests.

Meanwhile, among the leading "exciting" trends he said he sees impacting the mobile space today, Faith listed: technical collaboration and confluence; location, presence and persistence; and cloud computing and services, among other things.

Faith said using traditional Web technologies such as HTML, JavaScript and CSS, "to me, dramatically reduces the overhead to enter into the mobile space." He added that location, presence and persistence represent "the sharing of narratives, centered around a concept that is uniquely mobile ... and it gives you the ability to subscribe to content no matter where you are."

Moreover, regarding cloud computing, Faith said, "as mobile developers we're given this unique opportunity to create mashups with all the data available in the cloud. The value of cloud computing is as a developer I now have access to huge amounts of data. This phenomenon is just starting to be tapped. What it all means is there is great opportunity in the mobile environment right now. There is great opportunity to build disruptive applications."

Meanwhile, Faith said a MySpace application for Nokia WRT (Web Runtime) “will be available very shortly to Nokia developers.”

He also said MySpace is involved with the Symbian Foundation and its effort to open-source the Symbian code base.

“We hope the foundation will benefit from our understanding of the social experience and mobile devices,” Faith said.

The Social Network Game Boom

Social games -- essentially games created to be playable within existing major social networking websites -- seem poised to set a revolution in the game industry akin to the one first kindled by downloadable casual games. These games that use social connections have multiplied like wildfire on social networking sites.

The Social Network Game Boom by Sande Chen
April 29, 2009
With over 200 million people registered on Facebook, the most popular social networking site, and millions, millions more on similar sites like MySpace, Bebo, and Hi5, social networking has become a part of daily life. As quoted in the Financial Times, one CIO of a leading U.S. firm found that her young employees "communicate by Facebook and simply will not read their e-mail." Worldwide, social activists are using social networking sites to organize protests. Meanwhile, others have found old classmates and friends using these sites. It's a testament to the power of social networking. Likewise, social games -- essentially games created to be playable within existing major social networking websites -- seem poised to set a revolution in the game industry akin to the one first kindled by downloadable casual games. These games that use social connections have multiplied like wildfire on social networking sites. They represent a viable business opportunity for game developers and venture capitalists agree, investing approximately $98 million in social game companies last year. It's no surprise that mobile game developers, casual game developers, and web programmers are forging ahead with social games. Even EA has a Facebook game. Additionally, with a mixture of business models, social games offer game developers a test bed to see user reactions. Most importantly, because the sales are direct-to-customer, game developers own the customer relationship. Using customer data supplied directly by Facebook or other sites, they can more fully understand customer needs and in turn, engender customer loyalty. As such, these developers follow in the steps of successful companies like 7-Eleven Japan, which uses its customer behavioral data to forecast exactly needed inventories. While social games do not seem to have realized such accuracy as of yet, the potential for moneymaking remains strong. The Facebook platform, which was the first, launched in April 2007 and within weeks, entrepreneur Suleman Ali had a hit application and was generating enough revenue through advertising to hire employees. He eventually sold his company Esgut and its roster of games to Social Gaming Network (SGN) in April 2008. Nowadays, the big players in the social game space are Playfish, Zynga, and SGN. All of Playfish's games are in Facebook's Top 25 whereas Zynga clearly dominates the MySpace charts. While some consolidation in the sector is to be expected, a one-man shop is still a possibility. Entry costs are low and viral distribution over the Facebook platform reaches over 200 million potential users. That staggering amount, Gareth Davis, Platform Program Manager at Facebook, enthusiastically points out, exceeds the total number of users for World of Warcraft and Xbox Live combined. In fact, the number of users World of Warcraft has collected over four or five years is equal to the number of new sign-ups to Facebook each month. If this data isn't compelling enough, keep in mind that even before this population spurt, SGN's early Facebook game, Warbook, pulled in about $100K a month in its heyday. Facebook itself is estimated to have revenues of $50 to $70 million from its virtual gift sales (currently at $1 to $50 each) for last year. So, even if the games on social networking sites are simplistic compared to AAA titles, they are worth noting, especially since they have the power of social networking behind them. Social Games Defined But what exactly are social games? Like "casual games," the term is supposed to describe a specific market segment. Most games are already social, though, in that we play them with others or we participate in the communities that have built up around them. What makes social games different? Colloquially, games on social networking sites and/or on iPhone are called social games, but even this definition is up for debate. Some differing definitions or conditions include: Multiplayer games that utilize the social graph, i.e. a player's social connections, as part of the game. Examples: Parking Wars, PackRat Games in which the main gameplay involves socializing or social activities like chatting, trading, or flirting. Examples: YoVille, Pet Society Turn-based games that are played within a social context or with friends. Examples: Texas Hold'em Poker, Scrabble Competitive casual games that include friends-only leaderboards. Examples: Who Has the Biggest Brain?, Word Challenge PackRat Very clearly, some social games are ports or variants of existing casual games. Demographically speaking, women over 55 are the fastest growing segment on Facebook. The latest study from search service firm Rapleaf shows that with the exception of LinkedIn and Flickr, women outnumber men in all age groups across all social networks, so it would make sense that casual games flourish on these sites. Are social games just casual games transplanted to social networking sites? Not quite. Firstly, not all social games are considered casual games. They're called hardcore or casual based on gameplay. A strategy-based game like Warbook draws the same typical hardcore crowd of young males whereas the virtual pet simulation, (fluff)Friends, also from SGN, is popular among women, ages 24 - 40. So does the platform make all the difference? Partially. I would say one difference lies in social psychology. "There are nuances that you have to understand to do well on Facebook," warns Ali. Playing online games with friends has a different dynamic than playing with strangers. Even a zero-sum collection game like PackRat, in which players steal cards from friends, has been turned around by the desire of players to play cooperatively. Do you dare risk your friend's anger by stealing a much-needed card? People act differently when there's shared history.

Furthermore, unlike on MMOs or casual game portals, people don't tend make new friends on social games. They've already got an established network of friends and acquaintances. Instead, this type of socializing cements existing ones. The average Facebook user has 120 friends, but would not consider them to be all close, personal friendships. Social networking sites join "weak ties," people like high school classmates and old work buddies, and encourage what psychologists call parasocial relationships. You observe snippets of people's lives, but do you really know them? For deep relationships, it seems, you still need to put in the face time and have shared experiences.

(fluff)Friends

Exceptions exist, mainly in virtual pet and virtual world simulations like (fluff)Friends and YoVille. (fluff)Friends has even had a (fluff)Con for Fluff Fanatics. Lately, (fluff)Friends has been holding (fluff)Art contests, which appeal to users' creativity, but even without these contests, the (fluff)Friends community would still eagerly upload fluff(Art) for peer ratings a la YouTube or Flickr. These activities fulfill a basic human desire for approval, self-expression, and recognition.

In fact, these human desires may be heightened when interacting with friends rather than strangers. Emotions such as competitiveness, affection, love, envy, and pride are what Playfish calls "social emotions."

"Social emotions form the basic building blocks in each of our games," says Kim Daniel Arthur, VP of Global Studios at Playfish. "This requires a new way of designing and thinking about games, from simple elements such as our friends score bars in Word Challenge to the more intricate social interactions in Pet Society." For Playfish, the social experience of a game is the primary focus.

Again, look to social psychology as to why social comparison and friend-trading games exist alongside RPGs, virtual worlds, strategy games, and casual games on social networking sites.

Bragging rights and the need for social status are a big part of this landscape, especially when a person's every move is recorded by Facebook's continual newsfeed of updates, links, videos, photos, activities, purchasing habits, game scores, likes/dislikes, and even recipe selections. "Social games are communication tools," says Shervin Pishevar, founder and CEO of SGN. "That's why they do well in a massive communication network like MySpace or Facebook."

Other games, such as the Facebook RPG Mob Wars, are stripped-down versions of PC or console games. Although an RPG, Mob Wars is a game without gameplay, in a way, because the gameplay is replaced by a button click of "Do Job." It's as if every player had a Glider autopilot program to go out and kill mobs. However, the strategic elements of deciding which task to do first and inventory management remain intact.

Tom Abernathy, Writer at Microsoft Game Studios, remarks, "It's a serviceable but not exceptional little bare bones RPG. But I can play it while I'm doing other things."

This type of passive play, called sporadic play, and asynchronous or turn-based play, says social game blogger Bret Terrill, now Director of Business Development at Zynga, is critical to the success of social games. While not prevalent on casual game portals, passive play is common on social networking sites.

However, Playfish's Who Has the Biggest Brain? and Word Challenge are basically short single-player games. Launched in December 2007 as Playfish's first title, Who Has the Biggest Brain? seems to have a permanent lock in the Top 10 of Facebook games.

For now, there doesn't seem to be a unifying characteristic among all of these games, other than they exist on social networking sites. However, I would posit that there are certain design characteristics that could make social games a unique category.

An Ideal for Social Games

Social networking sites have changed how we consume information and how we play games. It is only fitting that social games reflect the characteristics of the platform. When combined together, the social graph, ambient awareness, and inclusive play are the design characteristics that make social games distinctive to me.

While new initiatives like Facebook Connect and MySpace Data Availability will allow these applications to run outside of social networking sites, these defining characteristics are not affected due to data portability.

Social Graph

Looking back to the proposed definitions in the previous section, there is one that does describe games that cannot be played anywhere else without data portability. These are games that utilize the social graph.

Most games do pull data from the social graph for challenges and friends-only leaderboards, but some go further by incorporating the social graph into gameplay. In Parking Wars, I can park on each friend's street and in PackRat, I can browse through my friends' pages.

In order to do well in Parking Wars, I need to know the usage patterns of my friends. I find that these games have the camaraderie of a board game, in that there are conversations about the game among friends, and yet, it's not necessary for all my friends to be online at the same time to play the game.

In theory, any sort of information, like fave bands or travel photos, can be pulled from people's profiles, much like Facebook ads do on the side. Ideally, these games would require people to know something about their friends to do well. Or at least, by playing the game, people would end up knowing more about their friends.

Ambient Awareness

On social networking sites, information flows at a rapid pace. The Facebook newsfeed is filled with information no one would ever write an e-mail about or call to tell a friend. Each piece of information is trivial -- e.g. "Facebook User made a ham sandwich." -- but taken in aggregate, all of it coalesces to form a daily picture of what's going on in the lives of friends.

This clutter of unfettered information leads to what social scientists call "ambient awareness." It's similar to noticing what others are doing in a room without even paying attention to them.

Each bit of information accumulates and without even noticing, you learn that two of your friends were in train wrecks, five have the same birthday, or three are attending a conference in Japan. Unwittingly, people's personal lives are scattered across applications, walls, forums, status updates, notes, and comments. Concurrent or parallel conversations are the norm.

Similarly, if I have ambient awareness in a game, it means that just by playing, I'm aware of my friends' progress in the game. I don't need to search for this information. For example, in PackRat, since I have to cycle through my friends' pages, I see their cards and activity logs.

If I've already gone through that set, then I know exactly which cards they need to complete the set. If I want to learn more, then I can click on my friends' Feats, which are similar to Xbox Live achievements or Pogo badges. As a side benefit, by creating these achievements or checkpoints, the developer can collect and analyze valuable customer data to improve the game.

Inclusive Play

The average user belongs to more than one social networking site, but devotes the majority of time to only one. As such, users have different participatory rates, logging in to one social network every day, another every once in a while, and yet another, only if an e-mail beckons the user to come back.

These different participatory rates translate into different play patterns. Some players have limited time and need a game that can be played quickly whereas others are willing to spend hours on a game. In fact, depending on the day or the social networking site selected, the same user may exhibit different play patterns. Therefore, it's more useful to divide players by play patterns rather than by gender or age. A game with inclusive play satisfies players who want to play sporadically and/or continually.

Obviously, real-time multiplayer social games have an issue if there are not enough friends online to play the game. By continual play, I simply mean that the game provides something meaningful for the player to do to further the experience. If I have more than 1 minute to play a game, then I should be allowed to continue.

Instead, in a game like Dungeons & Dragons: Tiny Adventures, I'm forced to wait. Sporadic play is great for multitasking but if you're not multitasking, then the game gives you no other choices to occupy your time. Decisions made with a button click, such as rearranging inventory, applying abilities, or applying potions, rarely take six minutes.

MMO consultant Brian Green agrees, "The game requires almost no meaningful input on the part of the player. It's mostly about coming back on the proper schedule and clicking a button to see what happened."

Mob Wars

In Mob Wars, the waiting period is required to regain energy. It's patterned after MMORPGs when a player needs to regenerate mana and health. However, in a MMORPG, a player can do something else to get XP without expending a lot of mana and health.

Just like "dead air" is anathema to radio, so too is any time the player is sitting around with absolutely nothing to do in a game, and that is, nothing, not even a look at pretty pictures. There is also the danger that the player may leave and forget to return to the game.

Much as sporadic play appeals to one player type, it doesn't work for everyone. Asynchronous play, however, fares better with its long history in games. War games such as chess have been fought via postal mail and then on e-mail and mobile phones. Players have an understanding of how asynchronous games work. Still, I have seen Scrabulous games fall apart due to lack of response. The notion that players have to come back to a game because it's sporadic or asynchronous is a hollow one.

Games built with inclusive play in mind allow all player types to enjoy the game regardless of whether they have 10 seconds, 10 minutes, or 10 hours to play the game. Most casual games fit this model because a player can keep on playing the same short "coffee break" game continually.

The player gets better at the game and perhaps unlocks achievements, but it would be nicer if there was a deeper experience. Other genres, like virtual worlds, RPGs, and strategy games, can certainly take advantage of this design philosophy.

Business Models

Although the development cycle of social games is similar to that of casual games, their business models are more aligned with MMOs. Given their origins, however, social games almost always have a free component. Beyond that, game developers are free to monetize applications as they see fit and they've been doing well with a mixture of the following business models:

• Advertising or Sponsorship
• Microtransactions: virtual currency and/or virtual goods
• Subscriptions or Premium modes

The advantages for developers for using a social network like Facebook are evident. The barriers to entry are low but the potential for profit is high. They're getting wide distribution on a trusted network and moreover, they don't need to share revenue with Facebook.

The approval for Facebook applications is quick -- something like 24 hours from submission. Ali built his first app in two weeks, but nowadays, with better graphics and production values expected, it might take three to six months for an application to go online.

Even after a game goes live, social game developers must maintain the service and answer to customers. Like MMO developers, social game developers are constantly adding content and evolving their games. Compared to MMOs, though, these iterations occur at a blistering pace.

"Facebook time is faster than normal Internet time," says Ali. "Facebook enables rapid feedback in a way that the Web never did before."

As such, clones of games run rampant, but the first mover may not have the advantage as other developers improve upon the design. The friend-trading stock market game, Friends for Sale, for instance, was preceded by Owned! and Owned! in turn was preceded by Human Pets. Mobsters, Mob Wars, and Mafia Wars are all similar takes on a RPG.

Some developers also sweeten their app's sales by appealing to users' charitable natures. (Lil) Green Patch, a top Facebook virtual pet application, purports to help save the rainforest while you tend to your garden and scare off pests.

Numerous other apps of this kind exist, some with ties to charities like the Nature Conservancy. The causes supported range from world hunger to global warming. It's unknown how much of this revenue actually goes to the charities. A few users from the IGDA Women in Games mailing list reported that by playing these games every day or by buying the game's virtual currency, they felt that they were assisting a valuable cause.

(Lil) Green Patch

Because these business models do better when there are more users, some developers had "forced invites" built into the application. If users wanted to progress in the game, then they needed to invite friends to add the application. "The days of Facebook games after the API was introduced were horrible for a lot of people," says Green, "because of the constant spamming by your friends to join some new game."

In February 2008, Facebook banned forced invites, which has led developers down creative routes to incentivize invites in game design or otherwise, use newsfeed notifications to their advantage. Both SGN and Playfish steadfastly avoid spamming, instead relying on word of mouth for their games.

Playfish is experimenting with all three business models and has been successful in monetizing these multiple revenue streams. Overall, Ali estimates that 80% of revenue for games comes from virtual currency whereas 80% of revenue for non-games comes from advertising or sponsorship.

Advertising/Sponsorship

The game developer can place interstitial ads, banner ads, video ads, links, or branded virtual items inside the game. Most advertisers are looking for an application that will integrate their brands into the game. This hasn't happened as much in games, but can with the help of 3rd party ad networks like AppSavvy, SocialMedia.com, and Cubics. Else, the game developer can sell ads or get sponsorship on its own.

Developers can also use networks like Super Rewards and Offerpal Media to receive a referral fee. In exchange for filling out offers to join NetFlix or other services, players receive virtual currency or goods. (Lil) Green Patch, for example, offers more acreage for your garden if you sign up for a number of offers.

Microtransactions

In most cases, developers use a dual currency system. In (fluff)Friends, there's munny and there's gold. Munny is earned while playing the game and can be used to purchase virtual goods to pamper your (fluff)Friend. Gold, however, is used to purchase limited edition characters, merchandise that simply isn't available to those with just munny. To obtain virtual currency like gold, players pay for it with PayPal or credit cards. Across Facebook, virtual items range in price, from $1 to $50.

As in the case with free-to-play MMOs with microtransactions, developers must be careful to keep these special items from unbalancing the game. It's important that non-paying players enjoy the game as much as paying players. For games like (fluff)Friends, it's definitely more fun with more players. Developers need to take care not to alienate non-paying players.

Subscriptions/Premium Modes

In the subscription or premium mode scenarios, players pay a monthly or yearly fee for extra modes or advantages. In Word Challenge, a player can pay for Pro Player Club membership and get more taunts, no ads, and exclusive modes of play, like Word Grid. Again, the issue here is whether or not the premium mode unbalances the game or gives subscribers an unfair advantage. In the case of Word Challenge, it doesn't.

In PackRat, though, the subscription definitely gives an advantage to XL (premium) players by giving XL players access to XL markets, double pack size, and tix, the PackRat equivalent of (fluff)Friends gold.

Although these perks are understandable because XL players want value for their subscription, it has slowed down the game considerably. With the extra pack size, XL players, whether intentionally or unintentionally, hoard cards and remove them from circulation. This was more apparent in PackRat v2.0, which has since been dismantled.

Future of Social Games

While the first generation of social games had simplistic gameplay and simplistic graphics, the second generation has upped the ante. Production values match Web games and game developers are merging the gameplay qualities of casual games, MMOGs, and virtual worlds. With Flash 10's 3D capabilities, 3D games may be coming to social networking sites soon.

"The sky's the limit," says Davis.

One day in the future, players will enjoy immersive strategy games, arcade games, casual games, RPGs, ARGs, and virtual worlds, all on a social networking site. Davis fully expects larger game publishers to join the fray and make this vision a reality.

As for indie developers, Ali, now a partner at Shotput Ventures, says, "Just do it. There are so many stories of people who are building an app for Facebook and it ends up being such a great success that they quit their day job. It's totally possible.