Inside Facebook

New Inside Facebook Top Jobs for August 29:

• Senior Application Developer (Familybuilder / New York, NY)

Facebook continued tweaking the News Feed in the redesigned Facebook this morning with 2 interesting changes:

• Status Updates now always occupy the top three story spots
• “All Stories” has been renamed to the more exciting “Live Feed”

The first three status updates also do not have the “show me more/less about this person” feedback options. It appears that Facebook is simply taking the three most recent updates without trying to prioritise.

Many users have missed the Status Updates panel on the right side of the old profile, and will be glad to see it being given more prominence in the new design. Whether this is a permanent change or just an experiment remains to be seen.

Popular Facebook game Mob Wars has recently been rumored to be the most profitable app on Facebook. While that will never be known for sure, one thing is clear: Mob Wars is making a lot of cash. Probably in the tens of thousands of US dollars per day. How?

One large reason: Mob Wars has baked incentivized CPA offers from Super Rewards directly into the game, and expertly tuned its virtual economy to drive offer conversions without significantly imbalancing the economy or damaging game play. (Mob Wars also works closely with CPA monetization firm Offerpal Media.)

Super Rewards has largely remained quiet on the PR front to date, but the company is working with many of the top developers on Facebook to monetize their games. Super Rewards partners include Mob Wars, Knighthood, Premier Football, and several of the top apps in Zynga’s family of games, including Texas HoldEm Poker and YoVille. The company has built a 14 person team across its Vancouver headquarters, New York office, and soon to be opened San Francisco office.

We recently spent some time with Super Rewards CEO and Co-founder Jason Bailey and President Adam Caplan to learn more about how the company is working with Mob Wars and other leading apps and social games to make real money.

Jason, how does Super Rewards help social app and game developers make money?

What we do exceptionally well is understanding the nuances of all the games we work with. We work closely with developers to tweak and balance their game play and economies around their virtual currencies. Developers come in making $100 a day and we can take them up to $1000 a day in short order.

How detailed do you get?

We provide a broad range of services, everything from pricing specific items to consulting. Some developers have experience with their economies in current or past apps and want our help putting offers in front of their users. Others come to us while their game is still in alpha and really value our input.

What’s the most important thing developers need to do to make money with CPA offers?

The most important thing is balancing your economy properly. You should support all kinds of players well, while remembering that your hardcore users will generate 90% of your revenue.

You want to make sure users want to obtain and spend points, while preserving the quality of the game play. For example, in Mob Wars, in order to replenish your health you can either wait for the system to revitalize you or you can “go to the Godfather” and earn some “favor points.” (see right)

So how do you measure performance?

The core metric we use is dollars per click. We hope our developers can get 25% of their daily active users through a Super Rewards page at some point. Of those, if the economy is balanced correctly, you should see a 40-50% click through rate, and ultimately a net 8-10% conversion rate. Developers get about $1.00-$1.50/conversion for US users, but less for international users. We’re lucky to get $0.06/conversion in China, but we have games operating in Europe and other parts of Asia at $0.25 and up.

So assuming all of a developer’s traffic is US traffic, the developer could see up to $83 per day per thousand DAUs. However, on an average basis across all geographies, we are about half that number. It goes without saying that there is a wide distribution around the average based on quality of app and balance of virtual currency economy.

What kind of apps are doing the best?

Games! Gifting and poking apps don’t do as well. Games that do the best are ones in which the players want to be on top of the leaderboard, collect items, or play games of chance.

Also, keep in mind at that a majority of the revenue generated per user is generated early in the lifetime of the users’ interaction with the games. People spend money developing their characters, climbing the leader board, and unlocking new elements of the game. Once their character is strong, they have many prizes, and have unlocked all the levels - naturally there is less desire to complete offers and pay. It is those top guys though that motivate the little guys to climb and thus spend.

As another example, there is one app that has about 200,000 MONTHLY active users (4-50k DAU). Yesterday, about 14,000 users hit the Super Rewards page (about 30%). The users were about 35% USA, 55% CA, AU, and UK, the remaining 10% all over the world. 5,500 clicks were generated (40% CTR). Revenues were about $4,500 for the day for an EPC of about $0.80. This is a newer app so its earnings per 1,000 DAU is a touch higher than average. Also it is an engaging game with a virtual currency so it is a great fit for us. It is a fairly international app, but nothing unusual. If it had more US users it would earning higher aver EPCs.

So those numbers scale well at the smaller DAUs, but when apps have 500k DAU the formula gets more complicated. That being said, there are PLENTY of apps making $6,000 a day on various platforms. But no single app that I know of making $60,000 a day consistently.

However, we’re just in the beginning. We’re starting to see bigger players move in to the space with higher quality apps. I expect to see some very high quality games released in the next few months.

And some people think our stuff looks hokey, but we purposely make it match the look and feel of the game, like in Mob Wars. That is just how Facebook games look.

Right. So, how much does the social network context affect monetization potential?

The social factor is definitely important in driving games where there is pride or ego involved in being on the top of the list. However, the main reason our partner apps are doing well is entertainment. Casual MMO’s outside of social networks would do just as well. Social networks are just a great way to grow quickly, and play against real friends and family instead of random people you meet in the lobby.

Thanks Jason. Any final thoughts?

We are very bullish on the space. We’ll be moving into other areas like casual games and web games soon.

Our 200 developers love Super Rewards, but they don’t want us to talk about it. But we’ve been optimizing our system over the last year, and are now ready for prime time.

Facebook will be holding its first Developer Garage “Connect Edition” next week in Palo Alto. Developers will be able to learn more about how Facebook Connect can be used to let users connect their Facebook identity to a third party site, find friends there, and share info back to Facebook.

While Connect is still in beta, this will be one of the first chances developers have to see early versions of Facebook Connect implementations. Here are the details:

• When: Wednesday, September 3rd
• Time: 6:30 PM- Midnight
• Where: Blue Chalk Café - 630 Ramona St, Palo Alto, CA

For more, check out the event page.

New Inside Facebook Top Jobs for August 27:

• Product Manager / Senior Product Manager (Viximo / Boston, MA)

As many users are aware, Facebook has been fighting mounting security threats in recent weeks. Developers and analysts alike want to know more about what’s happening and what Facebook is doing to contain the threats, so here’s the story:

The Problems

1. A variant of the Koobface worm, originally detected by Kapersky Lab a few weeks ago, has been increasingly spreading on Facebook in recent weeks. Here’s how it works:

Net-Worm.Win32.Koobface.b, which targets Facebook users, creates spam messages and sends them to the infected users’ friends via the Facebook site. The messages and comments include texts such as Paris Hilton Tosses Dwarf On The Street; Examiners Caught Downloading Grades From The Internet; Hello; You must see it!!! LOL. My friend catched you on hidden cam; Is it really celebrity? Funny Moments and many others.

Messages and comments on MySpace and Facebook include links to http://youtube.[skip].pl. If the user clicks on this link, s/he is redirected to http://youtube.[skip].ru, a site which purportedly contains a video clip. If the user tries to watch it, a message appears saying that s/he needs the latest version of Flash Player in order to watch the clip. However, instead of the latest version of Flash Player, a file called codecsetup.exe is downloaded to the victim machine; this file is also a network worm. The result is that users who have come to the site via Facebook will have the MySpace worm downloaded to their machines, and vice versa.

2. In addition, recent chain letters have started to spread across Facebook with various types of misinformation, including messages like “Facebook is going to start charging you to use the site,” “Facebook is going to start shutting down accounts that aren’t active enough,” etc.

Facebook’s Response

Facebook has responded in a number of ways:

1. Facebook is deleting content generated by the worm (Facebook says they have “again contained” it) and spammy chain letters.

2. Facebook is posting updates on the status of security issues to the Facebook Security Page and publishing best practices for users to avoid phishing attacks, like these and these.

3. Facebook is asking users to pass on the following information:

We will never use any of the following methods to tell you information, or ask for you to take an action:

• Your Wall
• An inbox message from a friend—in other words, chain letters.
• Messages spread through Applications—if an application is telling you that Facebook is about to shut down, report it.

Since there’s been a lot of wrong information about Facebook spreading around, we’d like to clarify a few things for the record:

• We are not shutting down accounts that are not “active” enough.
• We are not going to start charging you to use Facebook.
• We will never ask you to send us your password or login information.
• We will never put the responsibility on YOU to send information to your friends. If we have information we need to share, it’s our job to get the word out.
• When we do communicate to you about the site (with the exception of posts made on this blog) it will always be from a collective Facebook. You won’t hear from me, personally, or from Mark, or from Dustin, or from any of the Facebook bloggers you’ve seen here.

So the next time you see a chain letter, chain wall post, or chain anything, report it to our User Operations team, and tell all your friends to ignore it. We could make a joke here about passing this entry on to ten of your friends, but that’s not cool.

4. Facebook is blocking Wall posts that contain links to known phishing sites:

5. Facebook is improving its automated systems to automatically detect abuse on the site more quickly.

6. Facebook is pursuing many of the perpetrators (the company sued alleged Facebook account hijacker Adam Guerbuez last week).

Conclusion

What do Facebook’s recent security issues mean in the long run? Ultimately, it’s vital for everyone involved in the Facebook ecosystem that Facebook continue to invest in security detection and prevention. Everything in Facebook depends on user trust, and everyone wants  these issues to be have as little impact as possible.

Many developers have been (understandably) speculating that the Facebook redesign will go live to all users this Wednesday, 27 August 2008, because of a statement in the Facebook Developer Wiki page on User Logins in the new design that reads,

We are deprecating infinite session keys after the new profile launches to all users August 27, 2008.

However, it appears that this is likely not going to actually be the launch date. In a post last Thursday in the Facebook Developers Forum, the Facebook Platform Developer Operations & Support Team wrote,

We do not have a definite timeline set out for the permanent switch but it will most likely be past August 27th. We want to be certain to push out a stable and well received environment for both developers and the new profile on the whole, and we hope to have this finalized in approximately a month’s time. As soon as we have more specific dates and timelines, we will let you know.

Thanks,
the Facebook Platform Developer Operations & Support Team

The operative words here are “likely past August 27th” and “hope to have this finalized in approximately a month’s time.”

What that means exactly remains to be seen. Until then, developers will need to maintain versions of their apps for users in both the new and old designs.

Facebook’s Dave Morin just tweeted that Facebook has officially crossed the 100,000,000 active user mark as of 5pm PT today.

Crossing 100,000,000 active users marks a major milestone for a company that was founded 4 1/2 years ago. The company continues to grow at a tremendous rate - capturing more new social networking users than any other social network in 2008 - and tripling in size since this time last year.

Congrats to the Facebook team!

A month after the Agarwalla brothers took Scrabulous offline in North America, Scrabulous has disappeared for Facebook users in the UK and Australia, and other locations around the world. The icon and link has been completely removed from bookmarks and the recently visited application list and, although a search for the game is still possible, the user is greeted by a page with the following message:

So - is Scrabulous gone for good, or will it be replaced by the less contentious Wordscraper in the near future as it was in the US and Canada?

Update: Jayant Agarwalla, one of the developers of Scrabulous, just issued the following statement:

Sometime on 22nd August, Facebook took the unfortunate decision to restrict most users from accessing Scrabulous. This was in response to Mattel sending them a “take down notice” on 14th August.

Mattel itself had approached the Indian Courts in February 2008, seeking an order for taking down Scrabulous from Facebook and other servers. The Hon’ble High Court has reserved judgment in this matter after hearing both parties. It surprises us that Mattel chose to direct Facebook to take down Scrabulous without waiting for the Hon’ble High Court’s decision. Mattel’s action speaks volumes about their business practices and respect for the judiciary.

It is even more astonishing that Facebook, which claims to be a fair and neutral party, took this step even though they were fully aware of the circumstances under which the Mattel letter was sent to them.

We now await the decision of the Hon’ble High Court and shall accordingly decide our future course of action with regard to Scrabulous.

We wish to thank our fans for their continued support and hope to give them the best results sooner than later.

One major change in the new Facebook redesign is the combination of the Wall and Mini-Feed. And while the change is certainly significant from an end-user’s point of view, it is even moreso from a developer’s perspective. The News Feed system has been overhauled, with new publishing methods and story sizes for developers to utilize when creating feed stories.

Feed Story Templates

All feed stories are now required to be published using templates, which must be registered beforehand. Feed templates allow Facebook to aggregate and display multiple application stories simultaneously. More relevant stories that involve multiple friends (known as “targets”) will get more distribution, so users will view application stories as more engaging and useful overall.

Feed Story Sizes & News Feed Distribution

In addition to templates, three feed story sizes now exist:

1. One Line - One lined stories are now the default size that an application can publish onto a user’s Mini Feed. These stories are typically 1 sentence long and can be easily aggregated by Facebook to display on friend’s News Feeds. These stories cannot have images in them, and are cached by Facebook once published.
2. Short - These are medium sized stories which may contain images. This type of story is also cached on Facebook’s servers. Both One Line and Short stories may be published to friends’ News Feeds.
3. Full - These stories are the equivalent of the wall attachments in the old profile design. They contain pre-formatted FBML and can be up to 700px in height. They are not cached and will not be published to friends’ News Feeds.

Here’s an example of a Short and One Line story, respectively:

Publishing from the Canvas Page with Feed Forms

While an application may publish a one line Feed Story through the API, Facebook is requiring the use of Feed Forms to publish Short and Full stories from the Canvas Page (though this is apparently a bug, as applications are supposed to be able to publish short and full stories from an API call so long as the user has previously granted the application permission to publish these story lengths). These forms are called via Javascript and generate a standardized Facebook dialog with the story along with options for the user to select the size to be published.

These standardized forms are also being used throughout the new profile design to prompt for application permissions, in an attempt to boost the poor reputation (with respect to actions performed on a user’s behalf) that applications have received within the Facebook platform thus far.

Here’s an example Feed Form dialog:

Additional Resources

More resources are available for technical details about the new feed stories and how to create them:

• Developers Forum
• Developers Wiki
• Feed Preview Console