Zynga and Softbank plan to announce an alliance to take Zynga’s popular games on Facebook to Japan, according to Dean Takahashi of GamesBeat.
The Zynga-Softbank partnership was initially reported back in April, but now details are emerging. The market for social mobile games is huge in Japan, and this is an opportunity for Zynga to go international and become less reliant on its partnership with Facebook.
Zynga, makers of FarmVille, Mafia Wars, and Treasure Isle, have been the darlings of the social game crowd. Zynga has more users than the top 10 Facebook game companies combined, it generated $500 million in revenues in 2010, and raised $180 million in December from Russia’s DST which it is using to fund a shopping spree of Facebook games companies.
But, in the world of “what have you done for me lately,” it’s business appears to be more vulnerable with every passing day. Zynga has lost 10% of its traffic in recent weeks and recent changes on Facebook are impacting its bottom line, forcing it to spend more on marketing and give away more of its revenues with Facebook credits.
More importantly in my eyes, with all its money, employees, and momentum, Zynga continues to fail at creating innovative hit games. Every day, a new game on Facebook is released not by Zynga and whereas Playdom, Playfish, and Fox have released soccer/football games to take advantage of the global appeal of the World Cup, Zynga is strangely absent. For all its aspirations to be the world’s number one social games companies, Zynga will fail is they can’t come up with hit games that are not clones or end the word “Ville.” You can only ride the coattails of FarmVille so far.
Zynga’s business team is on fire, with its deals with 7-11, Yahoo!, and now this Softbank expansion into Japan. Now, let’s see if its team of 700+ employees can come up with some new hit games to take advantage of this expansion beyond Facebook.