Facebook scraps Credits currency

Many games have already converted Facebook Credits into their own currencies Facebook is ditching its own money system, Credits, and will convert the balance of its members' accounts into their local currencies.

Previously, app developers wanting to charge users for virtual goods or other premium features sold via the network had to use the service.

Facebook said it was making the change to "simplify the purchase experience".

The move may help boost the firm's profits. It takes a 30% cut of all transactions made on its network.

A post on its developer blog also announced that it would allow app creators to charge subscriptions from July. Game publishers Zynga and Kixeye had already been allowed to test out the feature.

Confusing conversions

Facebook had previously market Credits as a "safe and secure way" to make online payments, allowing users to buy them by credit card, PayPal or via prepaid cards sold at retailers.

Members were encouraged to buy large sums at one time by the promise of discounts - for example 50 credits cost $5 (£3.20) but 2,360 credits cost $200, representing what the firm termed an "18% bonus".

However, third-party developers tended to subsequently convert Credits into their own in-game currencies, making it harder for users to keep track of what they were spending.

"Since we introduced Credits in 2009, most games on Facebook have implemented their own virtual currencies, reducing the need for a platform-wide virtual currency," the firm's product management director Prashant Fuloria told developers.

The news follows the launch of Facebook's app centre in the US

"With local pricing, you will be able to set more granular and consistent prices for non-US users and price the same item differently on a market-by-market basis."

The news comes less than a fortnight after the firm launched an app centre in the US to promote software on its network.

One analyst told the BBC that there was sense in simplifying its processes, but the move carried risks.

"The problem with Facebook Credits was that it was pretty restrictive," said Ian Maude, head of internet at Enders Analysis.

"Doing this takes the headache away from Facebook of having to force people to use its system.

"It still takes part of the revenue which is much more simple, but the danger is that it could end up with a 'farmers market' - a less cohesive solution in which there are a multitude of payment solutions being offered on its network."

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Olympic portal opens on Facebook

  Facebook's dedicated section will let people follow their favourite athletes Facebook has announced a dedicated portal for London 2012 to allow fans to "connect with their favourite Olympians" at the Games.

The section features dedicated pages for athletes and sports, including a complete timeline history of the competition since the 1800s.

The IOC said the portal would create a "social media stadium".

However, restrictions on what athletes can or cannot post will restrict some content from being published.

Participants are subject to tight guidelines over content posted on Facebook and Twitter, particularly in relation to brands and broadcasting deals.

It restricts the posting of any video from within an Olympic venue.

'Ambush'

Mark Adams, from the International Olympic Committee (IOC), said that while visitors to the Games would be able to post videos and stills, athletes' activities would be curbed.

Continue reading the main story

It's impossible to think all day and all night about the next match, interacting with fans is a good thing”

End Quote Boris Becker "It depends on where they are," he said.

"If they're in a stadium, they can't. We have a relationship with various broadcasters around the world which provides the funding [for the Games]."

In addition, he said, the IOC would be watching for any attempted "ambush" marketing.

"It's something we always have to keep in our mind," he said.

"It does take away money from the Olympic movement. It's something that we have to protect."

Facebook, which announced the portal at its central London offices, said it hoped the portal would mean Olympics fans could interact with athletes in a way that had not been possible in previous Games.

Alex Balfour, from the London Organising Committee of the Olympic Games (Locog) said there was now a "perfect storm" of technology to allow a "really rich experience" wherever fans were in the world.

"We want make sure our Games is available to that new audience of digital consumers," he added.

Facebook said it would allow fans to use the network to discover footage of their favourite athletes - but some content would be geo-targeted, meaning certain footage might not be available in certain regions of the world.

Mr Adams admitted that the IOC had been slow to adopt social networking, but was now ready to embrace it for London 2012.

"The way I like to think about the IOC and our relationship with social media is that the Olympics is one of the oldest social networks that has ever been.

"Everyone has an experience and shares that experience with their friends and their family - everyone has an emotional attachment to the Games. We're just digitising that experience."

Hot water

Former world tennis number one and Olympic gold medallist Boris Becker told the BBC that using social media could help athletes prepare.

"It's very positive. It gives athletes the chance to get real opinions and real questions and to answer back.

"It's fun - everyone's online anyway. It's impossible to think all day and all night about the next match, interacting with fans is a good thing."

However, he warned that it was inevitable that some athletes might not think before they tweeted and so land themselves in hot water during the Games.

"The world and people are not perfect," he said.

"There will always be athletes who will take it out of line, but that doesn't mean that the platform is wrong."

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Facebook buys startup Face.com

Face.com is a 11-person start-up based in Tel Aviv, Israel Social networking giant Facebook has decided to buy an Israeli startup specialising in facial recognition technology - Face.com.

The firm already provides software that allows Facebook's members to identify and tag photos of their friends.

The terms of the deal are not known, but Reuters quotes estimates of $55-60m (£35-38m).

Tagging is a popular feature on Facebook, but privacy advocates have raised concerns about the technology.

Face.com's software scans photos Facebook users upload, and suggests friends they may wish to tag with just one click.

According to the social network, the acquisition does not mean there will be changes to Facebook's current face detection and recognition systems for photos.

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We would hope to see very strict safeguards on how this information is stored and who has access to it”

End Quote Emma Draper Privacy International "People who use Facebook enjoy sharing photos and memories with their friends, and Face.com's technology has helped to provide the best photo experience," said Facebook's spokesperson in a statement to the BBC.

"This transaction simply brings a world-class team and a long-time technology vendor in house."

Privacy issues

UK campaign group Privacy International warned of what it described as the potential pitfalls of the technology.

"Facebook are in the process of building the largest and most accurate facial recognition database in the world, and with great power comes great responsibility," the organisation's head of communications, Emma Draper, told the BBC.

"We would hope to see very strict safeguards on how this information is stored and who has access to it, particularly if - as seems increasingly likely - Facebook is going to start making money from it."

But Facebook refuted the suggestion that it was building a facial recognition database, explaining that the technology simply allowed people on Facebook to tag images of their friends quickly and easily, without allowing users to identify anyone on the social network unless they were already friends with them.

Face.com is an 11-employee startup located in the heart of Tel Aviv's startup community on Rothschild Boulevard, locally known as the Silicon Boulevard.

The firm could not be reached for comment, but in a statement on its website it said that "by working with Facebook directly, and joining their team, we'll have more opportunities to build amazing products that will be employed by consumers - that's all we've ever wanted to do".

Face.com launched its first product in 2009, and also supports third-party apps such as Photo Finder, Photo Tagger, and CelebrityFindr, which allows Twitter users to search for photos of celebrities.

Facebook has recently been expressing great interest in mobile and photo-sharing - in April, it bought Instagram for $1bn, and weeks later launched a photo sharing smartphone app called Camera.

Both apps allow users to add filters and make other tweaks to photographs.

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Facebook App Center offers good possibilities

Rating: Implications for mobile billing are key
Last week, Facebook launched its App Center in the USA (without any guidance for when the rest of us will get access). The company’s aim is to make it easier for its 900 million or so users to find apps which they can enjoy and share with friends. Crucially, the App Center features mobile apps as well as web apps. To make it easier for Facebook users to find social apps for their mobile devices, the App Center is now available in the Facebook iOS and Android apps, as well as on Facebook.com. There two things here in GoMobile News‘ view. Firstly, surprise that Facebook didn’t even hint at this when its share price was plummeting through fears that it couldn’t monetise mobile.
Secondly, as MACH’s Michael de Jongh – sales director for mobile billing and payments, points out, there are clear benefits to be derived by operators from the Center’s support for mobile billing.
A key feature of the App Center is that those apps discovered on a desktop computer can thus be sent to a mobile device using a new ‘Send to Mobile’ feature.
If an Android or iOS app requires a download, users will be sent to the Apple iTunes App Store or Google Play (formerly Android Market) in order to install it.
It is our understanding – given that being based in the UK, GoMobile News can’t test out the App Center quite yet – that Facebook apps will prove purchasable through operator billing.
Michael de Jongh observed, “The news that Facebook has begun rolling out a new mobile payments system is certainly good news.
However, direct operator billing will also bring a number of benefits to those operators that are onboard with this venture.”
de Jongh continued, “Through Facebook’s new one-click system, operators will be elevated to the position of a payments service provider.
In an instant, they can place themselves in the e-commerce value chain and start to win market share from players such as PayPal who have hitherto dominated the space.”
de Jongh continued, “New revenue channels will also be opened for operators, who will find themselves with a place in Facebook’s content value chain.
The high volume of payments on the operator’s networks will allow them to drive up revenues for themselves as well as the content provider.
In the future, it is even possible that through DoB (Direct operator Billing) operators will be able to extend their e-commerce credentials into physical goods and services.”
If this situation arises, then the potential benefits to operators will be significant and may fundamentally alter their role for years to come.”
It certainly seems jolly good stuff for mobile operators. Curious that Facebook didn’t leak anything about this before, though.
Tony is currently Editor of GoMobile News. He has taken over this role from Bena Roberts.

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Facebook consultant argues that website's ads work

In this photo illustration, a Facebook logo on a computer screen is seen through a magnifying glass held by a woman in Bern May 19, 2012.

Credit: Reuters/Thomas Hodel

By Sarah McBride

SAN FRANCISCO | Tue Jun 12, 2012 9:49am EDT

SAN FRANCISCO (Reuters) - Marketing on Facebook influences consumer behavior and leads to increased purchases for the brands that leverage the social-networking site, consulting company comScore said in a report released Tuesday.

"The Power of Like 2: How Social Media Works," looks at paid advertising on Facebook as well as earned media exposure-- meaning mentions of the brand made by Facebook users in status updates and the like. It is based on the experiences of large brands such as Best Buy, Starbucks and Target.

The report follows up on a July 2011 paper, "The Power of Like: How Brands Reach and Influence Fans Through Social Media Marketing."

It swipes back at recent research questioning the effectiveness of Facebook messages. A Reuters/Ipsos poll published last week showed four out of five Facebook users haven't bought a product or service as a result of advertising or comments on Facebook.

Most brand exposures on Facebook occur through users' news feeds, comScore said, rather than visits to dedicated brand pages on Facebook.

Fans - consumers who click a button that they like a certain brand or product - tend to outspend others for that particular brand, comScore said, citing examples such as Amazon, Best Buy, and Target. Purchase data comes via information from loyalty clubs, credit card companies, and third-party collectors, with the permission of the study participant.

In the case of Target, Facebook and comScore studied two groups. One group, made up of fans of Target and their friends, saw "earned" messages about Target - updates about Target that run in news feeds and the like.

The second group was made up of Facebook users who weren't fans of Target and saw no messages. Both groups had identical purchase behavior at Target prior to the study.

After the four-week study, the fans who saw the messages were 19 percent more likely to buy goods at Target than the group that didn't see the messages, and their friends were 27 percent more likely. A comScore spokesman said he didn't know how much messaging the groups were exposed to.

To measure the impact of paid advertising, ComScore conducted a similar study involving a national retailer. It looked at groups of Facebook users who were exposed to a paid online Facebook campaign about that brand, and a test group that was not. Again, the two groups had identical purchase behavior before the study.

By the fourth week of the study, the group that saw the messages was 16 percent more likely to buy goods at the retailer than the group that did not see the messages.

Separately, Facebook said it had conducted research on about 60 campaigns to measure their return on investment, or how many dollars in sales were generated by every dollar spent on Facebook advertising.

About 70 percent of campaigns showed a return of three times or more on the money spent for the advertising, a spokeswoman said. About half of campaigns showed a return of five times or better.

Evaluating the effectiveness of advertising has proved challenging for Madison Avenue, no matter the media, brands have long said. They find it hard to gauge how many people saw a particular ad, and connecting the message with purchases is even more difficult.

Facebook is a comScore client. Along with many other large brands, it hires comScore to measure advertising effectiveness.

Shares of Facebook closed at $27 Monday, down slightly from Friday's close of $27.10, and 29 percent below their offering price of $38 on May 18.

(Editing by Steve Orlofsky)

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