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"We think this growth target (30 percent revenue) is achievable with Disney's backing," Trefis noted. The stock analysis firm said assuming after-tax margins of around 15 percent, Playdom would need to maintain an average annual revenue growth rate of 30 percent during its forecast period to justify Disney's purchase price. Social City won the 2010 Game Developers Choice Online Award for Best Social Network Game. Trefis expects the segment's revenue to touch $4 billion in the next few years, with margins rebounding nearly 20 percent going forward. Disney Words of Wonder (now renamed 'Words of Wonder') Gardens of Time Kitchen Scramble Discontinued Games Guardians of the Galaxy: The Universal Weapon (GotG) Social City A casual strategy game in which the player develops a city.
Clearly, these types of games will have to continue to evolve if they hope to hold their audiences and incentivize them to spend money playing," Frazier said.īut Disney's consumer product business should benefit from Playdom, which generated revenues of about $50 million in 2009. Players are frustrated by slow loading and performance issues and report getting bored by the games easily. "While social network gaming has caught on with a mass market audience, it's not without its challenges.
PLAYDOM WORDS OF WONDER FREE
This data assumes significance as social games are free to play and generate revenue by charging users to buy virtual goods. An additional 11 percent said they intended on spending real money. Anita Frazier, an analyst at the NPD Group, said only 10 percent of social networking gamers have spent real money playing these games. Notably, RockYou is hiring developers from Digital Chocolate and. Zynga, the giant in the social gaming space, is said to be generating revenue between $500 million and $700 million a year and many analysts expect the company to pursue an initial public offering as early as next year.ĭespite its soaring popularity, social networking-based gaming industry is not without its odds.įor example, revenue could be a major issue. RockYou is licensing Army Attack, Crazy Penguin Wars, Millionaire City, and Zombie Lane from Digital Chocolate, and outright purchasing Gardens of Time, Words of Wonder, and City Girl from Playdom - which was significantly impacted by the Disney Interactive layoffs last month. Playdom recently posted a teaser trailer to YouTube that revealed the first glimpse (and by glimpse we mean a 13-second long video clip with a. "Because Zynga has a much larger user base than Playdom, we believe that Playdom's operating margins are lower," stock analysis firm Trefis said. It looks like City of Wonder is headed for the stars.
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