Zynga plans to build a gamers' social network

SAN FRANCISCO Tue Jun 26, 2012 5:36pm EDT

1 of 3. Zynga Chief Mobile Officer David Ko speaks during the Zynga Unleashed event at the company's headquarters in San Francisco, California June 26, 2012.

Credit: Reuters/Stephen Lam

Related News

SAN FRANCISCO (Reuters) - Zynga Inc unveiled a social network for gamers dubbed "Zynga with Friends" on Tuesday, hoping to wean itself from a longstanding, symbiotic relationship with Facebook Inc, while becoming a major Internet destination.

The company founded by Mark Pincus will also provide programming tools to help third-party developers devise online and mobile games based on its own software, expanding its slate further beyond mainstays such as "Farmville" and "Mafia Wars."

"We're opening our doors today and opening Zynga Partners for Mobile. We are inviting developers from all over the world to come and join our network," said David Ko, chief mobile officer.

Zynga wants to create an ecosystem with "best-in-class mobile developers and best-in-class mobile games," Ko said.

Zynga shares closed 5 percent lower on Tuesday as investors saw little in the announcement - which included the planned social network, as well as some new, casual games - to drive strong long-term growth.

The stock has lost a third of its value this year on concerns about its dependence on Facebook for the lions' share of its revenue - on a platform experiencing slower growth.

The new social network "is a natural step in the right direction," said Colin Sebastian, an analyst with Robert W Baird. "It might help them become less dependent on Facebook but ... they will continue to remain dependent on Facebook for quite some time.

"One area where they may have disappointed people is, they are not showing any games in development that target a more core gamer, or so-called mid-core gamer. That's something where we've seen a lot of growth for Facebook, and that's potentially a missed opportunity for Zynga."

A SOCIAL BEVY

On Tuesday, executives took the stage at their San Francisco headquarters to unveil a bevy of interactive features for its Zynga.com website, as it tries to develop a stand-alone network that can hook existing gamers.

The company is launching "Zynga with Friends" soon on the Internet and for mobile users, hoping to connect players across its entire game portfolio, which also includes "Cityville."

Zynga General Manager Manuel Bronstein said the platform eventually could have as many as 290 million users with some 2.8 billion daily social interactions once it is rolled out, but he did not specify a time frame.

The company is also trying to boost mobile usage, targeting a small but faster-growing wireless device gaming market that is quickly becoming a crucial battleground for so-called casual or social gaming.

Zynga also announced a new title, "Matching with Friends", to boost its offerings for mobile phones.

The company said it will also team up with Atari SA to develop games, but did not elaborate.

Zynga executives said they will provide developers a set of "application programming interfaces" - APIs - to make it easier for them to craft games using Zynga's software.

The company's stock fell about 5 percent to close at $5.76 toward on Tuesday.

(Editing by Edwin Chan, Tim Dobbyn and Andre Grenon)