Pincus on Zynga’s Real Money Gambling Future

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Zynga CEO Mark Pincus gave a brief talk at the Morgan Stanley Technology, Media Telecom Conference yesterday.

Listen to the entire presentation here.

Pincus covered a fair amount of ground, but the dominant topic of the conversation was his company’s plans for real-money gaming (RMG).

I’ve (roughly) transcribed the majority of his relevant comments below. Cliffs:

  • Pincus thinks widespread RMG is still a way off, especially in the U.S..
  • The company has no new announcements regarding RMG.
  • The company is not releasing details of the economics of its deal with bwin.Party
  • The general RMG plan is to “outsource” aspects where Zynga lacks experience.

The UK & Partnership with…

“We don’t have any new announcements today. What we’ve said is that we’re planning to introduce our first RMG products in the UK in the 1st half of the year.”

“We think of this as still the first inning for social and free-to-play gaming. And what I’ve said is that real money gaming offers a terrific opportunity for our players to add a new dimension to what they’re doing and we’re excited to be in the market and learning. And we think that we’ve chosen one of the best companies in the world [] as our partner.”

Party Poker

“We think we’d rather outsource the pieces we think other people have deep expertise in and not go and try to build all of that to start with ourselves.”

“We haven’t announced the particulars or the economics of the partnership [with Party]”

“We’re excited about the opportunity to make this [Party Gaming poker & casino games] available to our existing player base. And then we’re excited to take the combination of a our brand and social, a more accessible version to an audience we don’t have., And apply things like our data and analytics to what’s already a data-intensive marketing business.”

RMG in the US – What the Future Holds …

“At a regulatory level it’s kind of hurry up and wait. That’s what it’s been for awhile. It keeps feeling more imminent.”

“Our take is that similar to the EU where different countries have slightly different rules but you can go in any country that it’s regulated and market your products, we think it’ll be similar in the U.S.. It will be a question of which states are big enough to market in.”

“At an operator level, we’ve applied for an operator license in Nevada. That process, we’ve heard, is 12-18 months. So the timeframes are set by the regulators.”

Competition in RMG

“Similar to the way that we look at the overall video gaming industry, I think you have two kinds of opportunities. […] The [opportunity for Zynga] that is more exciting to me is bringing real money gaming to a lot of our players for the first time, the way we brought them social gaming. I don’t expect that we’re the company to win the hardcore people in real money gaming […] But I think we’re good at bringing these experiences to mass-market audiences, and that’s what excites us about it.”

Social aspects of RMG

“I definitely think that making the [real money gambling] experience social will make a difference […] When you bring the social and the identity in, things like reputation and bragging rights get a lot more exciting than if you’re in an anonymous poker room.”

Image: Zynga Games via Wikipedia.

- Chris is the publisher of Grove also serves as a consultant to various stakeholders in the regulated market for online gambling in the United States.
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