Facebook Gaming – Apple picking.

Facebook gaming lays bare another dispute with Apple.

• Facebook has launched its gaming service and by going last it is avoiding the blunders of its rival Google, but Facebook fell short when it came to Apple’s restrictive policies.
• Facebook has launched its streaming service which will be free to play (at least initially) and it is very different from all of the other offerings that are being made available.
• Its main features are:
  • First, start small: Facebook is very keen to avoid the mistakes made by Google Stadia whose launch was nothing less than a disaster as it massively under-delivered on its promises.
  • Facebook is starting with simple games that are latency and low bandwidth tolerant and will move up when the majority of connections can support a better experience.
  • Second, casual: Facebook is not looking to replace consoles or PCs at the moment and so is starting with the games users play most on mobile phones which are casual games.
  • This is a very good strategy because there is little evidence that hardcore gamers want to play their games on smartphones and because casual gamers are a completely different set of users meaning that different games are required.
  • Third, “free” for now: All games will be “free” until such a point that Facebook can deliver a higher level of games that users typically would pay for.
  • This is different from Apple, Google and all of the others who require a monthly fee in order to play.
  • However, the reality is that this service will not be free.
  • Instead of paying with cash, users will pay with their personal data which no different to Facebook’s other services.
  • Fourth, no iOS: Facebook is not launching on iOS because the way that Facebook has structured the service makes it look a bit like an app store which of course Apple does not allow.
  • Apple claims that it has offered “helpful feedback” to Facebook in order to get its service approved for iOS which Facebook has another view on.
  • Facebook revealed that Apple’s feedback was essentially: “this fails under policy” which given Apple’s history of intransigence in this area is quite a credible claim.
  • Apple is not going to budge until it is forced to do either by market forces or by the long arm of the government and so there will be no resolution to this any time soon.
• The net result is that Facebook’s shot gaming is grounded in reality and as a result has a chance of getting some traction with casual gamers.
• However, its inability to be present on iOS is a major problem and will hurt the potential for the new service.
• If Facebook can create a vibrant community of gamers within its platform, it will have extended its reach into the important Digital Life Segment of Gaming.
• Gaming is much less important than it was 6 years ago but it is still one of the big four and if Facebook can get a position here, it should be able to expand its revenue base.
• Furthermore, outside of China, Gaming is the one segment where there is no dominant player meaning that there is an opportunity to become the go-to place to play games on smartphones.
• No one has really gotten this right yet and only time will tell to see whether Facebook’s formula is the right one.
• Facebook is comfortably in the cadre of stocks that look heavily overbought at the moment and so I am waiting for the inevitable reassertion of reality before even considering this one.