Facebook – along with a few other social sites and the developers of games for them – may be in for a great few years. Certain experts believe that the business of virtual goods is going to take off in a big and very profitable way.
Here’s the opening line of a new article from the BBC: “Virtual goods such as weapons or digital bottles of champagne traded in the US could be worth up to $5bn in the next five years . . .” Which would correspond to a whole lot of nonphysical stuff, if you consider that transaction prices are often in the $1-$2 range.
Still, the BBC interviewed Jeremy Liew of Lightspeed Venture Partners, Playfish’s Tom Sarris, and a casual gamer on its path to that conclusion. Plus, there are the recent deals involving Zynga and Playfish to consider ($180 million and $400 million changed hands), along with the fact that Asia’s virtual goods market is already worth around $5 billion.
Toss in Facebook’s semi-sporadic support for its payment system and the new Preferred Developer Consultant Program, and it’s not hard to imagine that a great deal of growth in the virtual goods space is indeed possible.
Sarris addressed critics by saying, “The way we look at it is it’s no different from paying money to go and see a movie or rent a DVD. What you are paying for is the experience and that notion of entertainment.”
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