Banking on the Facebook App Economy

Some prominent Facebook app developers breathed a heavy sigh of despair last week when Facebook announced that it would effectively mute involuntary app notifications messages (e.g. “Mark Just Leveled Up in Mafia Wars”). For some of the huge gaming apps, such as Mafia Wars and Farmville, notifications generated major traffic – as much as 70%, according to TechCrunch’s Michael Arrington. But let’s be honest. Most of these so-called “notifications” were nothing more than unwanted spam. While they may have driven traffic for developers, Web communities are full of comments from fed-up Facebook users seeking to desperately turn notifications off. In most cases, they were powerless to stop them. blog_facebook logo

But as much as Facebook wants to keep the platform relatively spam-free, they aren’t about to tie developer’s hands. The app economy is simply too important. We already know that Facebook apps have proven to be a major source of online revenue with Zygna for one raking in revenues of more than $150 million from sales of virtual game-related merchandise.

Consider these major changes that will likely make it easier for apps to be used, launched and monetized:

  • New Prominence – In the current Facebook interface, installed apps can be somewhat difficult to find. The applications menu is about to move up to the left hand sidebar, creating a dashboard for apps and games. This is bound to lead to increased app usage.
  • Email Permission – App developers will be able to collect user email addresses and communicate with them through this medium. Previously, apps had to request special permission to do this. This makes it much easier to develop a true lead generation program through apps.
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