Zynga's Big Bet on Real-Money Gaming to Launch This Week in the U.K.
It's about time Zynga doubled down. — The company will roll out two real-money versions of its casino and poker games in the next few days, marking the gaming giant's first offerings in the online gambling space.
Context & Ripple Effects
This launch is the payoff to a two-year courtship of gambling. Zynga confirmed in January 2012 that it was seeking partners for online gambling initiatives, applied for a Nevada license that December, and in between positioned free-to-play slots on Facebook as the bridge audience while U.S. rules stayed unsettled.
The U.K. is where the bet lands first because it is a market where real-money online gaming is already legal and licensed — no waiting on American regulators. The breadth of pickup (TechCrunch, VentureBeat, Polygon, The Next Web and others all carried the announcement within a day) reflects how much of Zynga's post-IPO story now rests on finding revenue beyond virtual goods.
First-order effects
- U.K. players of Zynga's casino and poker titles can move from virtual chips to real-money wagers for the first time, giving Zynga a direct regulated-gambling revenue line alongside its free-to-play business.
Second-order effects
- Facebook-hosted social casino rivals face a competitor whose games can convert the same casual audience into licensed gamblers, pressuring them to pursue their own licenses or partnerships in regulated markets.
Third-order effects
- If the pattern holds, social-game companies split into two product tracks — real-money offerings where regulators permit them and play-money versions where they don't — making licensing strategy as central to the business as game design.
The trend: Social gaming is converging with regulated online gambling, with companies like Zynga converting free-to-play audiences into real-money players wherever jurisdictions allow it.