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Thursday, May 3, 2012

3 Ways Companies Profit From Virtual Goods

Image representing FarmVille as depicted in Cr...
Image via CrunchBase
 A report released in late 2011 predicts that the market for virtual goods, items existing exclusively on an online platform, will reach $2.9 billion this year. From the faux agrarian homesteads of FarmVille to the world of RuneScape, the virtual goods economy has already surpassed the GDPs of real-world countries such as the Cayman Islands and Aruba. Among the public companiesfinding success selling digital wares, Zynga, maker of popular Facebook games such as the aforementioned FarmVille and Mafia Wars, maintained a market cap of nearly $10 billion early in April. In 2009, Electronic Arts purchased Playfish, a U.K.-based developer of social media games, for $400 million dollars.
Anyone unfamiliar with popular social media gaming companies may be left wondering why so much money is being tossed at companies that are practically selling nothing. Though they are bought and sold like a commodity in their respective platforms, virtual goods are best categorized as a service; they enhance and improve the gaming experience, but aren’t a prerequisite for game play... Continue to read.

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