Zynga Loses Half of Its Players

Struggling Facebook game developer Zynga is facing further difficulties, as statistics reveal that it has lost 53 percent of its users since 2009.

Figures have shown that players of Farmville, CastleVille and other Zynga games interacted with them around 9.8 times a month in November 2009. That number has since dropped to 4.6 times a month, in October 2012.

The statistics have been released by analytics company Dystillr, in a report titled 'Volatility in Zynga's Core Genre' which can be read here.

"The core of Zynga's challenge is its dominance in the simulation-type games, where it has a 58 percent market share" Dystillr co-founder Jay Aird told Game Industry. "Since January 2011, simulation games' share of Facebook game users has plummeted from 64 percent to 29 percent today."

"Casual and social gaming is the fastest growing form of mass media of all time" continued Aird. "What we are seeing now is an evolution in the space as the most iconic genres appear to have peaked while new genres and competitors have emerged to fuel new growth."

However, Michael Pachter, an industry analyst for Wedbush Securities, also spoke to Game Industry, explaining that the solution to Zynga's continuing problems could lie in advertising:

"I think that Zynga's biggest problem is they started out as a free-to-play company, and so as they grow users they don't necessarily grow revenues. They have to figure out how to monetize every user. The simple way to do that is advertise."

Pachter added: "Make this commercial supported gaming. If you don't spend money you have to sit through ads and if you spend money you don't. So the Words with Friends model, where you can pay three bucks and opt out of ads, I think that's fine.

"I have to say, I actually think the right model for them would be if you pay a dollar, and the dollar goes as a credit in the game so you can spend it on in-game items if you want to, but if you deposit a dollar each quarter, no ads for three months.

"If you got four dollars a year out of each of their 311 million actives, that's more revenue than they're making now. That alone I think would solve their problems."

Zynga has seen many of its top executives resign and is currently embroiled in a legal dispute with EA. Its third quarter numbers indicated a loss of $105 million.