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Tuesday, February 5, 2013

Daily Report: Zynga at a Crossroads in Mobile Quest

Zynga has been on a monumental losing streak. Hits have been rare, profits nonexistent and crucial employees are fleeing.

In the next few months, Zynga faces a critical test, reports David Streitfeld in The New York Times, that will determine if even that sum is excessive: can it successfully put its most popular Web games, starting with Farmville, on mobile devices

“Do I wish that we would have gone all-in on mobile and made a bigger commitment to it earlier” Mark Pincus, Zynga’s founder and chief executive, said in an interview after the earnings release. “Yes.”

“While we are excited about the long-term growth opportunity on mobile, and the opportunity to make games even more accessible to people in more parts of their day, we need to build a compelling network around it,” he said.

That is because social gaming on mobile is not necessarly social.

“It’s kind of ironic, isn’t it” Mr. Pincus said. “You’re holding a phone, an inherently social device. Yet the experience we have is a more fragmented one.”

The central issue overshadowing even the mobile transition is whether Zynga became successful only because it was in the right place at the right time, a condition also known as dumb luck. Zynga’s rise was inseparable from Facebook’s, which gave it preferential treatment. That era is over. In March, Facebook will be free to develop its own games.