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Is Facebook gaming dying?

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Farmville 2 (Credit: Zynga)

Not too long ago, many people believed Facebook was the Next Big Thing in gaming. Developers debated it -- sometimes ferociously -- at conventions, while venture capitalists couldn't fund the companies making those games fast enough.

But over the past few months, the air seems to have been let out of Facebook's tires. Major publishers are withdrawing their support. Pop culture breakouts like Farmville are far and few between. Most damningly, players seem to have moved on to other diversions.

EA is the most notable recent company to back away from the platform. Earlier this week, the publisher announced plans to wind down The Sims Social, SimCity Social and Pet Society and seemingly is shutting down its Playfish division, which it paid $300 million for less than four years ago.

The EA pullback comes as Zynga, long the standard-bearer for the social gaming platform, has been slowly shifting its focus away from Facebook games and more toward the mobile and real-money gambling fields. That's especially worthy of note, since at one point, 15 percent of all of Facebook's revenue came from Zynga's games (and 90 percent of Zynga's came from Facebook). Zynga has itself been plagued with issues over the past year, including the exodus of several top-level executives, a CEO voted one of the worst of 2012 and dismal stock performance.

Facebook, for its part, says gaming has never been healthier on its platform. In a conversation with Gamasutra, Tera Randall, Facebook's technology communications manager, said game installs are up 75 percent compared to a year ago and that more than 250 million Facebook users are currently playing games on the social network each month (compared to 235 million last October)

The biggest game on Facebook these days is Candy Crush Saga, which boasts over 10 million monthly average users, according to AppData. That success, though, comes with something of an asterisk.

Candy Crush Saga got its start on Facebook, but it really began to soar in popularity when it hit mobile devices. Thanks to a tight integration with Facebook, however – players are frequently encouraged to ask for additional lives from their friends -- the social network still can technically count those people as users.

Using those sorts of technicalities to demonstrate a gaming stronghold is a far cry from 2010, when Will Wright, creator of The Sims, predicted social gaming could eventually make up one-quarter of the video game industry.

So why haven't there been any real Facebook-exclusive gaming breakouts lately? There are a number of reasons, but the biggest is the explosion of the mobile market. As apps continue to expand, most people don't have time to play games on their phone and on Facebook -- and they've opted to go with the mobile option. As a result, pretty much any popular Facebook game has a dedicated app these days as well, eliminating the need to go through a middleman.

But another critical aspect is that the viral nature of Facebook gaming has lost its luster. Two years ago, timelines were filled with updates and requests from Mafia Wars and Farmville, but the volume became so high, many viewed the posts as spam and began to resent them.

"Part of the problem with Facebook games and the idea of social and viral notification is that you're basically trying to push out your gameplay to people you don't know," says Billy Pidgeon, an independent market research analyst. "That's not really going to fly. For social games to work, it's going to have to be designed to work with people you know. It needs to be a tighter circle to work properly."

And since it's harder to have a real breakout hit on Facebook, fewer and fewer publishers are willing to take the risk. While the games are much cheaper to create than traditional console titles, they still have to recoup their investment. And as people spend more time on mobile than the Web, that's getting harder.

Still, few game makers are ready to completely give up on Facebook as a gaming destination. The launch of Facebook Home could reignite interest in the category, and it's still possible the company will find the magic formula to reengage players in a big way.

"Facebook could still be a platform for games, but they've lost a lot of opportunity," says Pidgeon. "Facebook now is talking up games as if it’s a big part of their strategy, but it has to be run properly."

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