The world's largest social game developer no longer has an exclusive relationship with the world's largest social network, according to filings with the Securities and Exchange Commission made by Zynga and Facebook.
Both companies filed a Form 8-K to change the terms of their relationship. Under the new terms, both companies will be free to operate independent of each other and work with other partners — a departure from the current relationship where Zynga requires players to use their Facebook accounts in order to play games on the Zynga.com platform, and virtual currency is issued by Facebook.
The new terms, which will be effective as of March 31, 2013, stipulate that:
- Zynga will no longer be separately obligated to display Facebook ad units or implement Facebook Credits on any such Zynga game pages, however any games and services that Zynga has on the Facebook platform will be bound by Facebook's standard terms of service
- Zynga is no longer required — subject to certain exceptions — to use Facebook as the exclusive social platform for Zynga properties or grant Facebook title exclusivities
Certain provisions continue to apply under the new terms, such as any game released by Zynga also being made available on Facebook, any social games acquired by Zynga also being available on Facebook and if Facebook allows real money gambling games on its platform and Zynga has such games, Zynga will launch them on the Facebook platform if certain conditions are met.
The change in terms also means that Zynga is no longer required to use Facebook Credits as its virtual currency, allowing it to create its own form of virtual currency, which could be a financial boon for the social game developer because Facebook currently takes a 30 percent cut of all Facebook Credit transactions.
Facebook is now also free to develop its own social and mobile games, although it has not yet expressed an interest in doing so and has said in a statement to VentureBeat that its focus is on being the platform on which games and apps are built.
The statement continues: "We have streamlined our terms with Zynga so that Zynga.com's use of Facebook Platform is governed by the same policies as the rest of the ecosystem. We will continue to work with Zynga, just as we do with developers of all sizes, to build great experiences for people playing social games through Facebook. "
Back in July Zynga posted a second quarter loss of $22.8 million and complained of "a faster decline in existing web games due in part to a more challenging environment on the Facebook web platform." In its third quarter it posted a loss of $52.7 million.
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