Facebook performs virtual currency about-turn; abandons Credits
20 June 2012 | 7720 views | 2
Facebook is to abandon its Credits virtual currency platform in favour of a system which allows developers to be paid in a local currency of their choosing.
The move to phase out Credits was posted on Facebook's developers blog, catching social media watchers by surprise. The mandatory introduction of Credits as a universal currency across the social network last year was viewed as a significant plank in the company's plans to extend its remit into the payments business.
In practice, however, the roll-out of Credits has slowed uptake of gaming applications, requiring users to switch in and out of multiple currency options - from US dollars, to Credits and back again to in-game currencies - and adding new layers of friction to the monetisation of developer applications. Removing Credits from the mix streamlines the payments process and provides more stable options for developer pricing, with Facebook continuing to rake in a 30% cut on all sales.
Beginning next month, developers will be able to accept local currencies for in-app payments - as well as take subscriptions - with Facebook Credits being phased out completely by the end of the year.
In its message to developers, the company says: "Since we introduced Credits in 2009, most games on Facebook have implemented their own virtual currencies, reducing the need for a platform-wide virtual currency. By supporting pricing in local currency, we hope to simplify the purchase experience, give you more flexibility, and make it easier to reach a global audience of Facebook users who want a way to pay for your apps and games in their local currency. With local pricing, you will be able to set more granular and consistent prices for non-US users and price the same item differently on a market-by-market basis."