Social Gold: Facebook Credits' two step set-up will hurt transactions
Considering Facebook's planned integration of Facebook Credits is likely to put a spanner in the works of many a third-party virtual economy platform, it's perhaps not surprising to see one major player Social Gold voicing its concerns regarding the forthcoming launch of the in-platform currency.
However, though its position is hardly nonpartisan, the fact the company claims Facebook itself has acknowledged some developers will lose out when Credits come into play is more interesting.
The admission apparently revolves around Credits' two-step set-up, with users having to first buy credit before being able to spend them in-game, much like the Microsoft points system on Xbox 360.
Currency concerns
"When responding to one of the questions, Facebooks Deborah Liu admitted that the two-step process hurts conversion," Social Gold says on its blog, discussing the recent f8 conference.
"Whenever users have to buy one currency and then convert it to the games currency, the conversion is poor. And most games will want to maintain their own currency. Given this, it seems Facebook has a challenge on its hands: Facebook Credits has poorer conversion and, therefore, lower monetisation than platforms like Social Gold."
Social Gold believes Facebook has underestimated just how important in-game currency is to some titles, stating that switching to Facebook Credits in mind of this two-step purchase system "is not a fiscally-responsible option for most games".
As such, many games could be placed in peril financially after making the transition.
Credit where it's due
"Immersive games with their own virtual economy simply cannot rely on a third partys currency as the cornerstone of their economy," the firm adds.
"Imagine if the Mexican government required that all of its citizens get paid in Pesos, but make purchases in US Dollars, requiring them to exchange their Pesos for US Dollars at 'conveniently-placed' ATMs at various retail locations.
"You can imagine how inconvenient that would be, however simple the ATM interface is, or how close the ATM is to their place of business."
Of course, Social Gold is naturally conscious of its own fortunes as Facebook Credits looms large and, indeed, many would argue other platforms following the two-step set-up haven't suffered from conversion issues but it will be interesting to see just how the development community reacts when Credits becomes a reality, supposedly within the near future.