Zynga: Cruella de Ville?
Zynga (NAS: ZNGA) is starting to get territorial.
The social-gaming giant is suing European rival Kobojo for trademark infringement. Zynga claims that the name of Kobojo's PyramidVille treads on the empire of "Ville"-named games that it has put out over the years.
The initial instinct is to laugh at Zynga's legal eagle maneuver. Is this case being tried in the Supreme Court of Irony? Zynga is a company that has made a living out of blatantly ripping off other successes.
- Words With Friends is obviously a clone of Scrabble.
- Scramble With Friends is a Boggle knockoff.
- Its recently acquired Draw Something is little more than Pictionary.
Zynga also isn't the first company to slap "Ville" at the end of a noun. Amazon.com (NAS: AMZN) had the short-lived Askville and Questville Q&A sites before Zynga was even born, and that's just one of the many online examples.
One also has to wonder why Zynga would draw attention to a rival game. Right now on Facebook, PyramidVille is attracting 810,000 monthly unique players. That's a pittance when stacked against CityVille's population of 39.7 million and the 24.1 million virtual farmhands on FarmVille.
Zynga also doesn't seem to have a problem growing its business despite the Kobojo game that was introduced on Facebook last year, but went mobile when a version for Apple's (NAS: AAPL) iPod touch, iPhone, and iPad came out in January.
Zynga's first-quarter results featured a better-than-expected adjusted profit of $0.06 a share on a 32% surge in revenue.
However, it's also easy to see where Zynga's coming from. PyramidVille is a lot like FarmVille. There are a few casual games in the mix that are far from what Zynga's been doing with its "Ville" titles, though a small part of the game involves the same harvesting of crops for points.
Obviously FarmVille wasn't the first game to involve harvests or rely on social sharing to grow in viral popularity, but Zynga is the one that has excelled here.
Zynga will never be able to apply for trademarks for all of the possible game titles ending in "Ville," so it may as well go after one of the bigger success stories. Even if Zynga falls short judicially -- which is a strong possibility -- it may be enough to dissuade smaller developers from bleeding their legal resources dry if they attempt a similar move.
At the time this article was published Longtime Fool contributor Rick Munarriz calls them as he sees them. He does not own shares in any of the stocks in this story. Rick is also part of theRule Breakersnewsletter research team, seeking out tomorrow's ultimate growth stocks a day early.The Motley Fool owns shares of Amazon.com. The Fool owns shares of Apple.Motley Fool newsletter serviceshave recommended buying shares of Apple and Amazon.com.Motley Fool newsletter serviceshave recommended creating a bull call spread position in Apple. The Motley Fool has adisclosure policy. We Fools may not all hold the same opinions, but we all believe thatconsidering a diverse range of insightsmakes us better investors. Try any of our Foolish newsletter servicesfree for 30 days.
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