Google has purchased virtual currency platform Jambool, a move that will fuel Google’s reported foray into the social networking world. Jambool’s Chief Executive Vikas Gupta and Chief Technology Officer Reza Hussein confirmed the deal Friday on the company’s website. “We are excited to announce that Jambool is becoming a part of the Google family today,” the founders write. They add, “The game has only just begun.”
Facebook’s Rival Service
Jambool’s main competitor is Facebook Credits, Facebook’s own virtual currency platform. Facebook Credits takes a 30 percent cut of earned revenue, whereas Jambool took 6 to 10 percent per transaction. It is mandatory for Facebook developers to use Facebook Credits for monetization. Editor’s Note: Facebook clarifies that use of Facebook Credits is not required, but is encouraged.
Social gaming has begun a multibillion-dollar industry. FarmVille creator Zynga is worth more than $4 billion, and recent estimates say that social gaming will reap more than $1 billion in revenue this year. Jambool conducted its own four-month study and discovered:
- 7 percent of users that make a virtual goods purchase are still buying them after four months. Still, the vast majority of people never make a purchase in any game that they play
- The best-performing social games can get 41 percent of users to make a repeat purchase
- The average North American spent $74 on social games, while the average Asian player only spent $30 on virtual goods
- Latin American users spend an average of $300 in a four-month period
Meanwhile, Google has kept quiet about the Jambool acquisition and is being especially elusive about the company’s plans to build a social networking site. Google’s CEO Eric Schmidt recently dodged the Wall Street Journal‘s question about Google Me, but did say that “the world doesn’t need a copy of the same thing,” which likely means Google Me won’t be an exact replica of Facebook.
Buying Spree
Google has now acquired 18 companies in 2010, many of which are potential components of its rumored social networking site, Google Me. Before buying Jam
No matter what Google is or is not saying, it’s readily apparent the company is preparing to battle Facebook on its own territory. Let’s hope Google Me isn’t another social networking failure for the company; Google recently shut down Google Wave, a collaborative Web site, and experienced embarrassing privacy flubs with Google Buzz.