Facebook To Make ‘Facebook Credits’ Mandatory For Game Developers (Confirmed)
Facebook is about to ruffle some feathers. We're hearing from one source that the social network is reaching out to game developers to inform them that it is making its own, official Facebook Credits currency mandatory.
Context & Ripple Effects
The move caps seven months of friction over virtual currency: back in [[a:1187772|June 2010, game developers told the Wall Street Journal they didn't 'like' Facebook's new currency]], wary of a mandatory cut, and Facebook has now answered that pushback by making adoption non-optional. Inside Facebook reports a July 1, 2011 deadline for Credits to be the sole Canvas game payment option, and Facebook itself confirmed the mandate on its developer blog in 'The Next Step for Facebook Credits'.
The timing is no accident: days earlier Facebook closed a $1.5 billion round at a $50 billion valuation and traded near $70 billion on SecondMarket, so formalizing a take rate on every game transaction converts the platform's social-graph distribution into auditable payments revenue ahead of any eventual public listing.
First-order effects
- Every game developer on Facebook Canvas must now route all virtual-goods sales through Credits by July 1, 2011, accepting Facebook's fee on transactions many previously processed through alternative payment providers.
Second-order effects
- Payment providers that had been undercutting Credits lose their Canvas distribution overnight, while developers facing thinner margins must either absorb the fee, raise prices on users, or negotiate special terms — the exact resistance the June 2010 reporting flagged.
Third-order effects
- If the mandate holds, it establishes the platform-as-tollbooth template: control distribution, then make your own payment rail mandatory — the same structure console makers use, applied to an open web app ecosystem.
The trend: Social platforms are converting distribution lock-in into mandatory proprietary payment rails, turning app economies into licensed storefronts with a guaranteed platform cut.