Facebook to generate $4 billion in revenue with social gaming

02 Jul 2011

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Facebook, with its more than 500 million active users, is expected to attract over $4 billion in ads this year which is more than double levels of 2010. A huge chunk of that ad revenue comes from social games played over Facebook's platform.

According to leading internet entrepreneur and former chief executive of online advertising giant DoubleClick, Kevin Ryan, Facebook Inc would generate $1 billion in revenue this year from social gaming.

Most of that revenue would come from advertising, Ryan told Reuters in an interview this week.

Facebook Credits are also included in the projected $1 billion revenue. Facebook Credits allow users to buy items for games and other activities on the social network, he added.

Ryan who is chief executive of luxury flash-sales company Gilt Groupe, also makes significant investments in internet businesses. His internet investments include 10gen which runs a popular data base for start-ups MongoDB and newswebsite, The Business Insider and news website The Business Insider.

In early 2011, Sean Ryan, Ryan's brother became director of gaming partnerships at Facebook.

Zynga Inc, the dominant developer of social games played on Facebook, is seeking to raise $1 billion by way of an initial public for which it made a filing yesterday (See: Zynga IPO may value it at $10 bn).

According to Zynga which generated $235 million in revenue during the first quarter of 2011, it generated substantially all its revenue from the Facebook platform. It added, it expected to continue doing so for the foreseeable future.

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