More Bets on Virtual Casinos: Big Fish scoops up Card Ace
Casinos are the hottest real estate in today’s heady world of social gaming.
From Zynga to Caesars, deep-pocketed companies are increasingly looking to get a piece of the action. On Tuesday, Seattle-based Big Fish Games staked its claim, acquiring the maker of one of the most popular social casino games, Card Ace: Casino.
The deal, gives Big Fish a seat at the table of the fast-growing social casino market, where consumers connect with other players in real-time using their smartphones, tablets and PCs to play poker, blackjack, roulette and other felt-table classics. The parties are not disclosing the price of the acquisition.
The games are just for fun – gamers can’t actually win any money. But the house still makes out OK, since many players choose to spend real money buying additional virtual chips to supplement the pile of free chips they’re given to start off.
Social concepts, the company that developed Card Ace: Casino and whose backers include Tesla Motors founder Elon Musk, does not disclose its financial results, but the Card Ace app currently ranks among the top 10 grossing iPhone and iPad apps thanks to in-app purchases of virtual chips and other virtual goods.
For Big Fish, which is known for single-player games and which generated more than $180 million in revenue last year, casino games provide a perfect bridge into the world of social gaming.
“Casino games are a natural fit for social,” said Big Fish founder Paul Thelen in an interview with Reuters. “Very few people like to play casino games alone.”
Zynga’s Pincus fights back against copycat accusations
Mark Pincus, the CEO of Zynga, isn’t pleased with reports that Zynga is ripping off games from small developers so he is doing something about it–wielding his pen to write passionate manifestos to employees invoking Silicon Valley greats like Apple.
After a game developer accused Zynga of copying a game called “Tiny Tower”, Pincus sent a 60-line memo to employees to make sure his flock knows Zynga has done nothing wrong, (the memo was leaked to the blog VentureBeat and later obtained by Reuters).
“Google didn’t create the first search engine. Apple didn’t create the first mp3 player or tablet. And, Facebook didn’t create the first social network. But these companies have evolved products and categories in revolutionary ways.”
And just like tech heavyweights did not reinvent the wheel, neither does Zynga need to with its simple but addicting games.
“We don’t need to be first to market. We need to be the best in market … Zynga Poker, FarmVille, CityVille and Words with Friends, none of these games were the first to market in their category but we made them the most fun and social,” he said.
Pincus also shows reverence to video game history involving games where players build towers-”it’s important to note that this category has existed since 1994 with games like Sim Tower.”
His arguments are perfectly valid. It is just amusing that he is getting so worked up about claims his company is stealing ideas from a game called ”Tiny Tower,” and then later defending the authenticity of Zynga’s new Bingo game to VentureBeat.
Tech wrap: Breaking down Zynga’s possible IPO delay
One of tech’s most anticipated public offerings of the year could be delayed, according to a report in the New York Post on Monday. Online gaming company Zynga may hold off on its IPO until November said The Post, citing a “source close to the company.”
The delay is partly related to questions the SEC has about how Zynga measures its daily and monthly users, as well as its bookings, CNBC reported. “Zynga’s accounting measures are less worrisome to the SEC than Groupon’s, says one person familiar with the matter, but the agency is nonetheless working to make Zynga’s prospectus as accessible to investors as possible,” writes CNBC’s Kate Kelly.
Renowned venture capitalist Alan Patricof, managing director of Greycroft Partners LLC, told Bloomberg TV he thinks Zynga is merely waiting for a “hole in the market,” which he described as a one or two-week period where the markets are up and the underwriting bank “calls up and says we’re going tomorrow.”
Fortune.com’s Dan Primack calls Zynga’s IPO delay a “non-story.” “Is it really news that market volatility might push things back a few weeks? … This is not a story about Zynga losing anything, let along its ‘zing.’ Need proof. Just try substituting any other IPO candidate where the NY Post writes Zynga.”
News of Zynga’s potential delay comes just 36 hours after Bloomberg reported the company restructured its shareholder agreement to give founder Mark Pincus unparalleled voting power. The board approved three tiers of stock, giving each one of Pincus’s shares 70 votes, up from 10, according to a document obtained by Bloomberg. The move gives Pincus more power than LinkedIn founder Reid Hoffman or Google founders Larry Page and Sergey Brin.
Zynga has asked current shareholders to agree to the new stock structure by Sept. 2.
from Summit Notebook:
Zynga CEO: Half of social web users will be social gamers
Don’t ask Zynga’s Mark Pincus how much money his company is making.
The founder of the hot social gaming company, which is operating at a more than $200 million yearly run rate according to sources familiar with the matter, said sharing such information would contribute to the kind of hype that would be bad for the nascent industry.
“I just hope that we can all partner to try to get the story out in a balanced way, so that the media doesn’t necessarily have to go back and forth, ‘This is the next great coming,’ and hyping it, and then two or three months later, ‘Oh they didn’t deliver on these very high expectations that we’ve all put out there,’” Pincus said in a conversation with reporters at the Reuters Media Summit.
He noted that Zynga, whose games include FarmVille and Mafia Wars, has been profitable for eight quarters and sees no reason to raise capital in a public stock offering anytime soon.
Pincus did sketch a rosy picture for the broader social games and virtual goods business.
“I believe the addressable market for social gaming will be the whole web and the mobile web.”
“I think that eventually more than half of the population of people who are socially connected with participate in social games.”
