SEPT. 25, 2010 • Zynga has purchased German game engine developer Dextrose. The latter is known for its Aves engine, which supports high-end gameplay in a browser window. Dextrose will become Zynga Germany in Frankfurt.
Impact: It is fairly obvious that Zynga is in trouble. With their new game, Frontierville, launched in June 2010, Zynga seemed compelled to make the game almost unplayable unless consumers spent money. This action alone shows that Zynga is struggling to monetize users. The purchase of Dextrose shows Zynga may be responding to falling usage of its key games off their 2009 and early 2010 peaks with an approach focused more on development. In other words, it shows a potential shift towards higher end content with more complex gameplay depth. These products will probably use existing Zynga/Facebook business models, but the goal will be the content alone provides a compelling reason to purchase. Historically, “casual” and “social” gamers, despite the terms themselves being somewhat of misnomers, eventually have good conversion rates towards usage and purchase of higher end content. This may be a natural evolution of where at least some of Zynga’s business needs to go.