Tuesday, July 19, 2011

Is Zynga a Fad?

After being a loyal Facebook user since '05-'06, I can't remember the exact date,"college fuzz." I've seen the social network grow as everyone else. Games, apps, now web-chat. The list is endless of all the different small company tentacles that emanate from Facebook. One company in particular that has monetized Facebook posting unprecedented revenues is Zynga.

I've played CityVille, & FrontierVille by Zynga. And what I started to notice is the games had the what I call "Sim City" effect. You are really excited by the game(s) at first. Maybe you are addicted. But just like building a city time and time again becomes worn out, what will happen to the soaring revenues of these companies? Even though Zynga's had a staggering revenue in its third full year in 2010 of $850 million, will this company continue it's lighting rise as the game maker of the future, or will these games be a friendster, or MySpace of the past?


I'm not sure is Zynga is here to stay or will slowly lose out to the studio game makers (EA, Activision, Nintendo, XBOX, PS2, etc.). It's hard to imagine that Zynga is valued at more than Electronic Arts, but it is true.


My gut tells me that while Zynga may have a niche market for years to come, it may be very hard to post revenues in the billions for the long-run. I'm sure the company already has projections for billions in revenues, but as I already said, will it last?


Today's techie B-Word.

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