High costs scaring developers away from Facebook

High costs scaring developers away from Facebook
Craig Chapple

By Craig Chapple

August 23rd 2012 at 1:28PM

Studio's losing up to 50 per cent of revenues from marketing and share cut, claims Lasky

Developers are being driven away from Facebook as making games for the social network is becoming too expensive, it has been claimed.

Speaking to the Los Angeles Times, venture capitalist Mitch Lasky, who has invested in the likes of Riot Games and Thatgamecompany said developers were losing up to 50 per cent of revenues to put their games on to the site.

He said that Facebook would take its 30 per cent share, whilst high marketing expenses to get noticed ahead of the big publishing giants meant costs had risen significantly over the past few years.

"Facebook is still a viable platform for independent developers looking to make money on a game," said Lasky.

"However, companies with aspirations to be larger publishers - Kabam, Kixeye, even Zynga - are moving aggressively off the Facebook platform to mobile and the open Web. Publishers aren't convinced that the costs of being on Facebook are worth it.”

Peter Relan, CEO of Facebook developer Crowdstar, said his studio had to expand to mobile given its previous reliance on the social network and suffering from its high costs.

He has since lessened the company’s dependence on it from 90 per cent to 50 per cent. Relan went on to say that he expects only ten per cent of Crowdstar’s revenue this year to come from Facebook.

"Facebook is no longer the viral platform it used to be for games," said Relan.

He added that many small developers had been discouraged to release content on the site, as Zynga would always outspend other studios on marketing and player acquisition.