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Zynga making $50 million in revenue from virtual goods

By on April 6, 2009

Social gaming company Zynga is reported to be making substantial revenues, and possible even be profitable, from its games on social networks.

Venturebeat reports that “it’s making between $50 million and $60 million annually in revenue, mostly from virtual goods like poker chips in its Facebook poker application, according to an industry insider.” Venturebeat also guesstimates costs to suggest that the company may in fact be profitable.

A lot of commentators were sceptical about the business model of companies like Zynga and its rivals Playfish and SGN, often on the grounds that they could not justify their venture-backed valuations on an advertising model.

Well, it looks as if Zynga has wrong-footed those commentators, and the virtual goods model seems to be working.

About Nicholas Lovell

Nicholas is the founder of Gamesbrief, a blog dedicated to the business of games. It aims to be informative, authoritative and above all helpful to developers grappling with business strategy. He is the author of a growing list of books about making money in the games industry and other digital media, including How to Publish a Game and Design Rules for Free-to-Play Games, and Penguin-published title The Curve: