Zynga revamps contract with Facebook
Zynga loosened its ties with Facebook in an amended agreement that had governed a close partnership between the two companies for years. As per the new pact, Zynga will no longer be required to use Facebook as the log-in for users, while Facebook will be able to develop its own games. Zynga can choose to do away with Facebook Payments as the way for users buy virtual goods and opt not to show ads served by Facebook.
“Zynga’s mission is to connect the world through games,” Barry Cottle, Zynga’s chief revenue officer, said in a statement. “In order to do this, Zynga is focused on building enduring relationships with consumers across all platforms from Facebook and Zynga.com on the Web to tablets and mobile.” Read Zynga’s regulatory filing here.
Facebook, however, in a statement has said that the social network has no plans of getting into gaming business. “We’re not in the business of building games and we have no plans to do so,” Facebook clarified in a statement. “We’re focused on being the platform where games and apps are built.”
It is believed that there are various parts of the new deal that could hurt Zynga’s interests in near future. As per the terms of the new pact, Zynga will be barred from using Facebook to “cross-promote” its games. This means when a player on Zynga.com shares their accomplishment or any activity on a given game that shows up on their Facebook Timeline, the post will not link back to Zynga.com. This would definitely dampen traffic to Zynga.com.
Both Zynga and Facebook have been making efforts to reduce their inter-dependence. In an attempt to come out of Facebook’s shadows, Zynga launched its gaming platform, Zynga.com. Facebook, in the meanwhile, started wooing other game developers.
“We have streamlined our terms with Zynga so that Zynga.com’s use of Facebook Platform is governed by the same policies as the rest of the ecosystem,” a Facebook spokesman said in a statement. “We will continue to work with Zynga, just as we do with developers of all sizes.”
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