Buxter software is expected to take the market for game credits and gifts to £554m
Facebook users are expected to spend millions of pounds online following the release of a new application which allows developers to make money out of previously free games.
Platogo, a developer of games on the social networking site, has said it has begun using the application to enable its players to use real money – up to €50 (£40) at a time – to buy virtual currency in its Facebook games.
The new application, called Buxter, was released by the payments company ClickandBuy earlier this year, and is described as an online wallet to allow Facebook users to send and receive money, for example to contribute towards a friend's birthday present, or to repay a share of a restaurant bill.
Buxter's website says: 'It used to be only messages, images and videos that you could share with your friends on Facebook. With Buxter, you can now also share money.
'Whether it is the lunch money you owe a friend, or the virtual item you want to buy in your favourite game, Buxter is there to provide you with safe and simple payment solutions.'
However, Platogo, an Austrian games company that has developed games such as Veggie Snake and Whac-A-Pal, believes that Buxter could also hold the key to helping developers generate revenues from previously free-to-play social network games.
Jakob Sommerhuber, chief executive officer at Platogo, said: 'Research from the Inside Virtual Goods Report shows that the market for games and gifts within social networks will be worth $835m [£554m] by the end of this year. For any business operating within Facebook this is a potentially huge market. The problem until now has been how to make it easy for users to make payments – to buy virtual goods within games, for example. Buxter has solved that problem in a stroke.'
In an interview for Inside Social Games, Mark Zuckerberg, the chief executive of Facebook, said it made sense that there should be one currency that could be used on games developed by different companies, including Farmville creator Zynga. 'If I go play a CrowdStar game right now and get credits there, I can't go use those credits in a Zynga game, so that kind of sucks.
'One of the biggest inefficiencies in buying virtual goods is all the friction of having to take your credit card out, so having one store of [virtual currency] that you can use everywhere is both good for users and good for all the apps.'
But this could be bad news for parents who are trying to keep tabs on their children's Facebook activities. The Guardian recently reported on a 12-year-old boy who used his mother's credit card to buy £900 of virtual currency on the Farmville game.
Michael Arrington, founder of the Techcrunch blog, criticised Zynga last year for monetising Farmville, accusing the games developer of generating 'hundreds of millions of dollars' from unsuspecting players, many of whom are children.
ClickandBuy has welcomed Platogo's adoption of its application. Charles Fraenkl, CEO of ClickandBuy, said: 'This is a fascinating piece of innovation by Platogo. They were quick to spot that Buxter is just as suited for use by businesses within Facebook that use micro-payments as it is for Facebook users.'
Fraenkl added: 'Platogo's imagination looks set to have opened up a way for thousands of Facebook businesses to begin generating revenues from apps that were previously free to use.'
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