Facebook has launched a new Credits page on its developers site aimed at convincing game and application companies to implement Facebook Credits as a payment option. Facebook announced earlier today that Credits will become the exclusive payment method for all canvas games and apps starting July 1st, 2011. The page explains that Credits help developers because they increase revenue and reduce costs, and that Facebook’s incentives for implementation will help grow business.

To incentivize implementation as the exclusive payment option before this mandatory switch, Facebook is offering developers “early access to product features and premium promotion on Facebook, including featured placement on the Games Dashboard, premium targeting for ads, and access to new co-promotion opportunities” as well as “advice and support from Facebook’s games and credits teams.”

The top of the Credits page displays a scoreboard of stats regarding how widely Credits have been implemented. It currently states that “More than 350 games and apps use credits. 22 of the top 25 games use credits. More than 150 developers use credits”, and Facebook will likely update these numbers as adoption grows. The scoreboard is designed to exert peer pressure on developers, implying that they don’t want to be the last to start using Credits.

The Credits Page’s arguments for increased revenue through implementation include “higher conversion rates, increased average revenue per user…and access to millions of users with stored credentials.” This last point is the true strength of Credits. Facebook’s currency facilitates impulse buying though three-click purchases, while players might reconsider and decline their purchase by the time they’ve input all their credit card details.

The Page explains that Credits help developers reduce costs by removing the need to set up local payment options across the world, allowing users to pay through a variety of gift cards, and passing the threat of fraud to Facebook. As Facebook grows internationally, the global accessibility of Credits lets developer monetize sudden popularity in more obscure countries.

Developers can apply to receive special incentives from Facebook for adopting Credits if they meet the following criteria:

1. Facebook Credits is your app’s in-game currency.
2. All virtual goods available for purchase with in-game currency are priced in Credits. However, goods can be available through earned currency.
3. Virtual goods are not priced in local currency or another in-game currency.

Any developers who already meet the criteria should apply immediately.

The incentives include featured placement on the games dashboard that receives a over 30 million impression a month, as well as “new placements and premium ad targeting.” Some of the premium targeting options Facebook might make available include targeting users who have a current balance of Credits, or who reach a minimum engagement level with apps games. The option to beta test new products is also a valuable incentive, because it gives developers a head start in formulating best practices of how to use the products.

The Page concludes with links to executive summaries of the success three gaming companies have had with implementing Facebook Credits. Arkadium notes that it only took two weeks to make Credits the sole payment option. Digital Chocolate cites a 60% drop in consumer contact rates and reports of billing issues as well as a four times increase in conversion rates since implementing Credits. PopCap, makers of Bejeweled Blitz, notes that Credits helped reduce method development time and increase revenues.

Nowhere on the Credits page is Facebook’s revenue 30% cut explained. Still, unless this cut equates to a significant loss, developers may as well switch early and take advantage of the incentives rather than wait for the July deadline.

Starting at its developer conference last April, Facebook has been saying publicly for the past year that Credits would eventually be the only payment option in social games on the site (although it started saying so to developers months before).

It had originally slated all developers to have completely made the switch by the end of 2010. While that has mostly happened, there are still many games not using Credits.

So the company is announcing today that all developers who have games on canvas pages will need to move to only use Credits by July 1st of this year. New games will be required to use Credits as the virtual currency when they first set up their canvas pages; older games will also be required to switch to exclusively use Credits, too.

For users, that means no more paying for currencies directly with credit cards or other methods that don’t somehow use Credits.

For developers, it means more costs and benefits to plan for.

Credits, along with whatever benefits it brings, also comes with a 30% revenue cut that developers have up to this point not had to pay. Although many have already adopted Credits in whole or in part, the potential cost of exclusive implementation continues to be an issue for the ecosystem. Facebook’s mandatory push could, beyond the risks to developers’ businesses, also help increase the prevalence and ease-of use of Credits to the point that the currency makes relatively more money for developers even with the fee — or that, at least is, Facebook’s plan.

New Credits Promotions, More Stats

As part of the news, Facebook is also releasing some big updates to its promotional plans for Credits, and stats on adoption.

Perhaps the biggest piece of news is that Facebook is going to be strongly encouraging developers to use Credits is the premium in-game currency, beyond requiring Credits to be the only virtual currency payment option. According to Deb Liu, a lead platform marketing manager  at Facebook, the company could offer additional benefits for developers who do this, including free advertising on the Games dashboard, in other Facebook ad inventory, and in other special features. She tells us to expect more news on that front soon. Note that we’ll be asking her for more details tomorrow, as she’s on a monetization panel at our Inside Social Apps conference in San Francisco.

Liu tells us that Facebook doesn’t plan to make premium-currency implementation mandatory, however. The company is, as before, only requiring that developers use Credits as the payment method for one or more currencies that developers have within games. In case you’re not familiar with social game virtual currency models, many popular titles are currently designed around dual currency systems. These currencies are branded around the particular game, and allow developers to tweak the virtual economy by doing things like give away more of one kind of currency for in-game actions, and increase the monetary cost of the premium currency at the some time to encourage people to buy (and pay more).

However, Facebook did tell us that it may make “some exceptions” to this new policy of requiring Credits to be the only available payment option, with those exceptions possibly including prepaid game cards that have already been launched by a few large developers, as well as specialized regional payment options which Facebook has not yet integrated into Credits.

Facebook’s rationale for promoting in-game usage of Credits is that doing so will increase the overall visibility of the currency to users, thereby enticing more and more of them to spend their money on it directly. Otherwise, the additional step of buying Credits then buying another currency can create confusion and decrease conversion.

While Facebook has been criticized by developers for forcing Credits on them, the company should also be recognized for the drawn-out implementation process it is going through to make sure that the product works for the ecosystem. Liu explains that the next five months are intended for lots of fine-tuning of payment options (it plans to add a lot more), payment flows, the new features, and other parts of the expansion.

Beyond whatever Facebook plans for promoting in-game implementations, it also has a bit more to share about adoption — Credits is now used by 350 applications from 150 developers representing around 70% of Facebook virtual goods transaction volume, according to the company.

We’ve separately heard some developers privately praise Credits as a better way to monetize than other payment options, and we’ve also continued to hear other developers claim that Credits could destroy their livelihoods. We’ll be discussing all this at Inside Social Apps tomorrow.

Although the announcement appears to be directed at all social games, we’re also double-checking with Facebook to confirm that the rules do not apply to non-gaming apps that have virtual currency, such as gifting titles.

While social games often top our weekly list of the the Facebook applications that gained the most new monthly active users in the past seven days, we’re seeing a broader range today, including dating site Badoo, music Page management company Rootmusic, and deals site LivingSocial.

First, the latest numbers from our AppData weekly gainers leaderboard:

Top Gainers This Week

Name MAU Gain Gain,% 1. Badoo 22,586,522 +3,231,486 +17% 2. BandPage by RootMusic 14,613,718 +1,002,587 +7% 3. Ravenwood Fair 5,620,149 +881,384 +19% 4. 德州撲克(中文版) 7,120,465 +754,400 +12% 5. LivingSocial 3,954,254 +711,433 +22% 6. FarmVille 中文版 3,628,827 +689,067 +23% 7. GodsWar Online 1,458,615 +560,766 +62% 8. Yahoo! 8,133,272 +516,212 +7% 9. Farmandia 2,393,268 +515,719 +27% 10. Facebook Live 896,511 +483,001 +117% 11. Paradise Life 1,232,573 +440,651 +56% 12. Social Statistics 1,895,827 +424,465 +29% 13. Windows Live Messenger 15,123,787 +359,011 +2% 14. My Photos 2,893,314 +340,541 +13% 15. Epic Fighters 1,517,775 +332,917 +28% 16. Social Connect 533,237 +331,726 +165% 17. Texas HoldEm Poker 36,693,515 +322,739 +0.89% 18. Что твои друзья думают о тебе? 901,132 +284,268 +46% 19. Profile Banner 567,253 +283,682 +100% 20. My Band: Profile Pages for Bands and Musicians 4,909,527 +278,860 +6%

Badoo, a years-old dating/social networking site, recently added a variety of Facebook integrations — and it also ported user profiles from its site into Facebook, apparently increasing the number of potential date matches that Facebook users are seeing. The result, as you can see, is growth of more than 3.23 million new users in the past week. It now has 22.6 million MAU total, making it the seventh-largest app on the Facebook platform according to our AppData leaderboard on the matter.

RootMusic’s BandPage app, which we’ve been covering extensively in recent months, has continued to boom as more and more musicians look to create and fine-tune their Pages for users. It came in second after Badoo, gaining more than 1 million users in the past week to reach nearly 15 million MAU total — it wasn’t so long ago that the company was excited to announce the 10 million mark, so evidently things are continuing to go well. Check out our earlier reviews for more details.

LivingSocial ran a massive deals campaign with its new investor Amazon last week, letting users buy an Amazon gift card worth $20 for half off. Aside from promoting its partner and saving users money, the result was also apparently nearly a quarter million new users to its relatively small Facebook app.

Among the other non-games on the list today, Windows Live Messenger and Yahoo! Facebook Connect integrations continue to grow well. The former has grown steadily in recent months but the latter is only now appearing to boom. We’ll take a look at Ravenwood Fair, 德州撲克(中文版) (Texas Hold ‘Em, but in Chinese and by Boyaa, not Zynga) and other social games over on our sister site Inside Social Games.

The following article presents data from Inside Facebook Gold, our research service presenting stats and insights on Facebook’s growth around the world.

No service to date has managed to dislodge Facebook’s dominance in North America since the site overtook MySpace in early 2009; our most recent data corroborates the site’s strength in the region.

Ad Rates Strong in December

Despite slower traffic growth in both the United States and Canada throughout the last month of 2010 (with audience counts for the latter market shrinking slightly), Facebook nonetheless maintained a regional total of over 145 million users by January 1, 2011. With audience numbers this massive in two of the strongest economies in the world, Facebook continued to see high advertising rates in the region, with US cost-per-click rates hitting an upper bound of $1.76 and Canadian rates trailing at $1.34.

While ad rates tend to fluctuate somewhat by week and even by day, they can serve as a useful indicator of the robustness of the advertising market in Facebook’s mature regions. The US market saw ad rates peak in late November, just before the holiday rush, followed by a dip and a rebound in the latter half of December. Relatedly, the peaks seen in the last month and a half of the year could be due to greater advertiser demand during the holiday season. So far, January has been a slower month for Facebook’s ad market; next month’s update will show if and how rates even out as we progress through 2011′s first quarter.

Traffic Saw Little Growth, but Remained High

With around half of the American and Canadian populations now on Facebook, it’s still too early to tell if the site is nearing its saturation points in these markets, or if there is still room to capture the half that is still unclaimed.

However, Facebook traffic in North America has hovered around 140 million for a few months now; as this market matures, the site may begin to see diminishing returns on its efforts to bring uninitiated users to the site.

In the year ahead, Facebook’s work in these markets will involve not only capturing new users, but also delivering experiences that keep today’s users coming back for more.

Detailed data on ad rates by demographic for over 190 country markets around the world is available with a membership to Inside Facebook Gold, our data service that also includes the monthly Global Monitor Report. Learn more at Inside Facebook Gold.

In response to official complaints from German officials concerned about protecting user data, Facebook will change its Friend Finder tool to increase transparency about how the site uses imported contacts. However, it appears that many of the requested changes are already live, and it’s unclear whether any additional changes will only apply to German users or the site’s entire population. The move could also encourage more governments to levy restrictive privacy legislation against Facebook.

The frequent prompts on the home page and new user flow for users to upload their contacts through “Find Friends” links have helped Facebook grow to over 500 million users. Uploaded contacts aren’t shared, but are saved so user can send them invitations to join the site, and power friend suggestions that increase user retention by facilitating interconnection.

These suggestions and invites caused privacy concerns, leading German officials to initiate “proceedings against Facebook.” Still, Facebook doesn’t send invitations to imported contacts automatically or without permission as German online news source Spiegel implies.

The site has agreed to provide users “transparent control over the addresses he or she imports”, and to “alert users that they should only send invitations to those contacts who they know personally and who, in their opinion, want to receive such an invitation”, according to Johannes Caspar of Hamburg’s data protection authority.

Facebook already offers an “Invite History” page which lets users manage and remove imported contacts, an informational dialog about how contacts will be used, and an unsubscribe button on invitation emails, but this was not sufficient for the officials.

Additionally, officials are requiring that “the non-Facebook member who receives the invitation must likewise be informed why he or she received the mail.” To adhere, Facebook might include explaining that the address was imported through the Friend Finder tool. Also, since users might have thousands of email contacts who they don’t know personally, Facebook might have to make sending invitations opt-in, while now it defaults to sending invites to all imported contacts.

Facebook and Government Intervention

Friend Finder landed Facebook in the news earlier this year when it butted heads with Google over whether the social network could import contacts from Google’s Gmail if it didn’t allow users to export the addresses of friends. It also released the Impact tool, linked to on the home page under “Track your invites”, which made inviting friends seem like a game in order to encourage the viral spread of the service.

Facebook has clearly billed its Friend Finder as a tool that assists users when it’s also crucial to its own growth and successes. Since Facebook is already in compliance with many of the requests, changes shouldn’t immediately cause a significant hiccup in expansion.

This isn’t the first time Facebook has had to answer to a government inquiry. A probe from Canada’s privacy commissioner into how data is shared with third-party applications led Facebook to create the explicit permissions system and a predecessor to the modern applications, games, and websites privacy dashboard.

Without a serious competitor in the social networking market, government intervention could be the biggest threat to Facebook’s longevity. These types of flaps raise it’s profile amongst lawmakers, which Facebook is countering through an increased presence in Washington.

Germany’s move could inspire other government agencies to seek feedback from their constituents over whether to impose limits on the site’s actions. Facebook should consider expanding privacy and security messaging, and toning down controversial uses of user data to preempt farther reaching legislation that could stymie future growth efforts.

Check out the top headlines and insights this week from Inside Social Games – tracking all the latest developments at the intersection of games and social platforms.

Monday, January 17th, 2011

• Train City Adds Another Rail Line to Facebook Gaming
• Farming Games Break Through on This Week’s List of Fastest-Growing Facebook Games by MAU
• Totally Be a Spy on Facebook, While Still Shopping for New Clothes

Tuesday, January 18th, 2011

• Rock Out With the Undead on Facebook in Zombie Mosh
• Facebook Ads and the Rising Cost of User Acquisition
• Cooking Mama Brings an Iconic Restaurant Game to Facebook
• Last Chance to Register for Inside Social Apps InFocus 2011, January 25th

Wednesday, January 19th, 2011

• Zynga Sets Up RewardVille for Dedicated Players
• Kingdoms of Camelot, Ravenwood Fair Rise on This Week’s List of Fastest-Growing Facebook Games by DAU
• BringIt Adds Minigames for Pop Boom and Happy Aquarium, Claims Improving Metrics
• Highlights This Week from the Inside Network Job Board: NaturalMotion, Meteor Games, & More

Thursday, January 20th, 2011

• Kabam Pulls In a Giant $30 Million Funding for Massively Multiplayer Social Games
• Raise a Kingdom for Facebook With Mini Kings
• New Hires in Social Gaming; BringIt, Brooklyn Packet, Digital Chocolate, & More
• Sold Out! See You at Inside Social Apps InFocus 2011, January 25th
• Zynga Wants Beta Testers for New Game “Crime Nation,” or “Mafia Nation”

Friday, January 21st, 2011

• Shop & Build with Magic Mall on Facebook
• Miscrits and a Mean Hand of Cards on This Week’s List of Emerging Facebook Games
• Zynga Buys Area/Code, Developer of Ubisoft’s CSI: Crime City Game on Facebook
• Social Gaming Roundup: Playfish, Scoreloop, Old Navy & More

Facebook Pages aren’t just for communicating. Thanks to tab applications, they can serve as ecommerce storefronts as well. Russian ecommerce widget startup Ecwid allows businesses to set up a single store that can be embedded on Facebook Pages, blogs, websites, and mobile sites. All Pages should consider monetizing their fan base through an ecommerce app like Ecwid, even if that means just slapping their logo on a t-shirt produced through a print-on-demand service like CafePress or Zazzle.

Ruslan Fazlyev started Ecwid in September 2009 as a nimble, social-minded offshoot of his ten year old ecommerce software company X-Cart. The self-funded, twelve-person startup now has 38,000 stores set up on its platform. Though only 25% of those have a Facebook version, the company reports that it is the second largest Facebook ecommerce provider next to frontrunner Payvment, which operates a network of interconnected stores. Fazylev says businesses should choose Ecwid because most merchants don’t want their customers to be able to easily click to a competitor’s store — something Payvment facilitates.

Ecwid uses a freemium model where businesses can sell physical or digital goods with no fee, or opt to pay $17 a month for a white-labeled widget or app with API access and the option to distribute discount coupons. $950 gets businesses setup support and custom features.

To set up a store, businesses visit the Ecwid Control Panel where admins can register an account with their Facebook, Google, or email account. They can add products to their catalog, view a summary of orders, and get the embed code for their widget. The Sales tab offers detailed data on payments and shipping, and the Customers tab offers basic CRM functionality.

To add the store to a Page, admins can visit the Ecwid Facebook app and input the unique store code from the Ecwid Control Panel. This create a “Products” FBML tab on the selected Page that includes images and prices of four products from their store. Clicking any of the products or the “Open Our Store” button brings users away from the Page to a full-width iframe Facebook app. The AJAX interface allows users to drag desired products into their shopping cart, see product details, or share products to their feed.

Upon checkout, users can select to use PayPal, Google Checkout, Authorize.Net, or any of the nine other payments methods the merchant has activated. Users are directed off-site to enter payment details, which could be viewed as more secure or as adding friction to the process.

Businesses who want to sell across the web but only manage a single catalog can benefit from Ecwid. The user interfaces seem a bit hacked together and could use some polish, but all the necessary components are there. Though Payvment may become the premier Facebook ecommerce tab app, there is plenty of room in the market for an embeddable storefront that also functions on Facebook.

Facebook Accused of Negligent Security – Sophos security firm and BitDefender have both taken Facebook to task for not providing adequate security and protecting user privacy. Most recently Sophos found that 40% of social network users were sent malware, up from the year before — Facebook’s rebuttal is that the report doesn’t detail how many of those were actually successful, and adds that attacks have decreased in effectiveness.

Facebook Hosts HTML5 Tech Talk - Facebook announced it will host a Tech Talk on Wednesday, Jan. 26 at 7 p.m. PST to explore how Facebook, Zyng and Sproutcore are going to use HTML5.

MySpace Not Closing, Partnering with Facebook? – MySpace reached out to Facebook recently to “talk about unique ways we could work together which truly benefit bands and the fans that are on the Facebook platform,” according to Roberto Fisher, vice president of product for MySpace Music. Fisher went on to tell Digital Music News that the company is “hanging in there” because he believes MySpace has different things to offer fans than Facebook.

NPR, Facebook Media Success Story – NPR’s digital strategist Andy Carvin appeared at an Online News Association meeting this week to talk about how the organization’s 1.4 million fans communicate around Facebook. NPR’s main goal is building a community on Facebook, as opposed to just driving short-term clicks, which gives them success such as growing its click generation from 1.5 million to 1.4 million pageviews a month.

Facebook Shuts Down, Reinstates Cuba’s Page - According to an odd mix of sources mostly outside of the US, YouTube and Facebook reportedly shut down a Cuban political channel and Page from a group called Cubadebate over “copyright” issues — both then quickly reinstated the group after being denounced by the Cuban government.

Two Thirds U.S. Teens Facebook Friend Parents – A recent study from Kaplan Test Prep found that about 65% of teenagers friend their parents, 38% ignore parental friend requests and 16% said friending parents was a condition of joining the social network.

Facebook Gets Flack Over Name – Facebook is on the receiving end of accusatory talk over its name, according to TechCrunch. A long-distance calling company Talkbook, is trying to cancel Facebook’s trademark on its name.

Majority of American Adults Use Facebook - The Pew Internet & American Life Project recently released a report, “The Social Side of the Internet,” and found that about 82% of American adults use social networks, among other interesting statistics.

Due to a bug that was causing the multi-friend selector to not load properly, Facebook has temporarily removed the “Suggest to Friends” option from Pages. Rather than allow users to encounter the error, Facebook removed the feature’s link from Pages until it can fix the bug. Admins can still see the link, but it is dysfunctional.

Other news outlets have reported that Facebook purposefully removed the feature, which would have hampered Page growth, but this is not the case.

Update: Facebook has now confirmed that users can no longer access Suggest to Friends. Admins can still use this feature. For more information about Suggest to Friends, visit our 4/27/2011 article Facebook Revamps Page Suggestions, Adds Page Invites Manager to Page Browser.

Page admins should not fret, as their users will soon regain the ability to invite friends to Like a Page. Admins who try to click the Suggest to Friends link on Pages they control will see a gray line appear but no way to select friends.

The Suggest to Friends feature helps Pages grow socially. Though Facebook prohibits Pages from specifically incentivizing users to invite their friends, some Pages like that of Lil Wayne use the “About” box located just below the link to draw attention and encourage users to click it. These calls to action will seem confusing until Facebook reactivates the feature and restores the link to Pages.

If users or reporters are ever confused by a broken or removed feature, they can check the Known Issues on Facebook Page. It posts updates that can help them determine if the problem is only occurring for them, and whether Facebook is aware and working on a solution.