An Important Milestone in Zynga's Quest for Independence
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Six months ago, social gamer Zynga (NAS: ZNGA) officially unveiled its own gaming platform on its own website, an unsubtle indication that it was tired of relying on Facebook (NAS: FB) for its fame. Importantly, Zynga's platform would be open to third-party game developers, as the company hoped to become a toll collector after paying similar tolls to the social network for so long.
Since then, Zynga has been diligently working to diversify onto mobile platforms as well, and these efforts are noticeably beginning to pay off. Once upon a time, Zynga consistently chalked up 90% of both bookings and revenue to its blue partner in crime, but this contribution has totally dropped off a cliff in recent quarters.
Source: SEC filings.
Only 80% of bookings and 87% of sales were generated through Facebook. "Only" may not seem like the right word when we're talking about four-fifths of bookings, but that's still a big drop from 93% in just two quarters.
Furthering this cause comes news that Zynga has just launched four different third-party games on its site for the first time ever: Sava Transmedia's Rubber Tacos, RocketPlay's Sports Casino, Majesco's (NAS: COOL) Mini Putt Park, and 50 Cubes' Fashion Designer. The company had already launched many of its own popular titles on its platform, including CastleVille and Zynga Poker, among others, but the release of third-party titles is a milestone toward its quest for independence from Facebook.
Zynga has recently been making big pushes with its Zynga Partners program and also mentioned that it's adding nine new partners to its platform, with the total tally now standing at 24 developers as it tries to become a game publisher. Those partners span both desktop and mobile platforms, and include some household names like Konami (NYS: KNM) and Atari. The first game in this category was Horn, developed by Phosphor Games, published by Zynga, and released last month. The game is a stark contrast to Zynga's bread-and-butter casual gaming and a more traditional role-playing title.
Between growing partnerships and erecting its own platform, Zynga might be on to something here.
There are plenty of flaws in Zynga's business model that I've outlined in this comprehensive report, but these recent initiatives are definitely encouraging. Sign up for the premium Zynga research service to get updates and be the first to know if I ever change my tune on the social game maker.
The article An Important Milestone in Zynga's Quest for Independence originally appeared on Fool.com.Fool contributor Evan Niu owns shares of Apple. Click here to see his holdings and a short bio. The Motley Fool owns shares of Facebook and Apple. Motley Fool newsletter services have recommended buying shares of Facebook and Apple. Motley Fool newsletter services have also recommended creating a bull call spread position in Apple. The Motley Fool has a disclosure policy.
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