Facebook lets users play game demos directly within News Feed

Facebook today announces a new feature that lets users try out games directly within News Feed.

Part of the social network’s continued effort to improve game discovery, the new “feed gaming“ feature lets developers create a short demo of their game that users can play when they see it mentioned in News Feed and Timeline. These samples don’t need players to authorize an app and don’t collect user data, creating a risk-free environment for users to test a game before they commit and give a game access to their personal information. Once the sample is complete, users are prompted to play the full version of the game.

Feed gaming is already being used by King.com’s Bubble Witch Saga, Rovio’s Angry Birds Friends, Tetris Online’s Tetris Battle and Idle Games’s Idle Worship. Bubble Witch Saga offers players a level to play and then rewards them with extra soft currency if they install the game. Angry Birds Friends challenges users to beat a level score posted by a friend. Idle Worship provides a mini-game designed to generate interest in the full game. Tetris Battle, meanwhile, allows users to publish video replays of two-player battles.

Demos are a reliable tactic within other sectors of the game industry, often released before a title’s launch in order to build word-of-mouth hype. Larger games have even had demos come to Facebook, like Majesco’s Cooking Mama Friends’ Cafe, which used Arkadium Stadium to let users directly play the Flash game from their Facebook walls. Users haven’t been able to play samples of Facebook canvas games before now, though.

Developers can test the effectiveness of different game samples, images and copy in their feed stories. Facebook app insights will now show the number of impressions, clicks and clickthrough rate of each feed game story. See more details in Facebook’s documentation here.

This story originally appeared on our sister site, Inside Social Games.

Facebook provides reach data directly on Timeline posts

Some Facebook page owners can now view certain post metrics directly from their Timeline, including the percentage of fans that saw a given post and the percentage of those who saw the post as a result of paid promotion.

This gives page owners an at-a-glance understanding of how many fans they are reaching. Or, more likely, make them realize how many they aren’t reaching. As users share more and connect with more Open Graph applications, there are more stories competing for placement in News Feed. Increasingly, page owners will have to support their content efforts on Facebook with paid media.

In February, Facebook said that pages reach only 16 percent of their fans each week on average. By showing reach percentages on Timeline rather than requiring page owners to visit the insights dashboard to see them, the social network can subtly encourage page owners to consider spending money on Sponsored Stories or Reach Generator, a premium offering which guarantees that a page reaches at least 75 percent of fans within a month.

Facebook has provided other post metrics in-line with a page’s content in the past. In 2010, it began displaying total impressions and feedback percentage for each post. This wasn’t always helpful because impressions were not unique and feedback was calculated by adding Likes plus comments and dividing by the total number of impressions. Posts that generated fewer impressions often had higher feedback percentages, which made it difficult for page owners to determine their success.

A year later, the social network tried expanding the number of metrics included below each post on a page’s Wall. Page owners could see impressions, unique users, clicks, clickthrough rate and engagement percentage. However, the real-time insights were buggy and ultimately scrapped. Toward the end of 2011, Facebook changed its per post metrics from impressions to total people reached and from feedback to People Talking About This. When Timeline for pages rolled out in March, these counts were only visible from the insights tool.

Our friends at All Facebook first wrote about this change to Timeline.

Facebook hires team behind UX research and design firm Bolt Peters

Facebook has hired the team behind the San Francisco-based user experience research and design firm, Bolt Peters.

Bolt Peters will end operations on June 22 to join Facebook’s design team. The firm has fewer than 10 people, but it is unclear how many of them will become employees of the social network. The company, co-founded by CEO Nate Bolt in 2002, has done work for Twitter, Zynga, Pandora and dozens of other well known clients. It also spawned a standalone company, Ethnio, which provides a way for websites to recruit visitors for real-time research. That company will continue to run independently.

As Facebook expands its reach throughout the world and designs experiences for multiple devices, the social network needs a strong grasp of how users interact with the platform. It is constantly testing variations in design and functionality, and the Bolt Peters team could provide a lot of value in pushing usability forward.

In a blog post announcing the move, Bolt says, “We’re stoked about Facebook’s commitment to user experience, and the design team is a critical part of this.”

Facebook did not provide comment or details beyond what Bolt included in his post.

Investing in Facebook: Rick Marini of BranchOut

This week, Inside Facebook asks people who have built businesses on the Facebook platform why they believe in the company. These are the people that are truly invested in Facebook, whether or not they bought stock.

For Part 4 of our series, we spoke with Rick Marini, founder and CEO of professional networking service BranchOut. The Facebook app lets users organize their professional connections, see which friends have worked at companies their interested in and search for jobs. The company has raised more than $49 million in venture capital since it launched in 2010.

Seeing the potential of Facebook

Marini realized the potential of Facebook when the social network moved in on the turf of his own company. In 2009, Marini created Superfan.com, a social entertainment site that allowed users to express themselves by becoming a fan of everything they love in life. It soon became clear that Superfan couldn’t compete with Facebook’s own fan pages product. When Facebook changed “become a fan” to “Like” in 2010, the number of Facebook users joining fan pages quickly accelerated.

“I realized the power of the network,” Marini says. Superfan began to incorporate sharing features so that users could “fave” things on the site and then post that activity to Facebook.

Around the same time, Marini and his team began to think about how Facebook could be applied to a number of different of industries.

“We realized there were all these verticals that should be social, that should be done on Facebook,” he says.

Developing a business idea

Marini says the most obvious industries that would be transformed by Facebook were those that were inherently social, like dating, ticketing or travel. These are things that bring people together offline, so they should be done that way online, too.

After working at job search company Monster for three years, Marini and his team still had ideas about the jobs and networking space.

“We realized no one had owned the professional side of Facebook,” he says. This seemed to have greater potential than Superfan did.

Marini and his team pivoted and became BranchOut in June 2010. They launched the app a month later.

Confidence in Facebook

Marini believes in Facebook because of its scale, the frequency with which people return to it, and the strength of connections people have there with friends and family.

“Facebook has combined [these] three big things that I don’t think anyone’s ever done,” Marini says. “That’s incredibly powerful and they still have a lot of runway.”

Then there’s BranchOut’s own quick rise. The app, which runs on the Facebook canvas and the mobile web, has more than 10 million monthly active users, according to AppData. Last month when BranchOut raised $20 million in a series C round, the company announced it had more than 25 million total registered users. Much of the app’s recent viral growth comes from Facebook’s Open Graph publishing and single sign-on for mobile.

Future of Facebook

Marini sees Facebook’s future not just in advertising but as a platform for developers.

“They want companies like BranchOut to disrupt multibillion dollar businesses,” Marini says.

In order to do that, Marini says he’d like Facebook to invest more resources in the platform so there are more engineers focused on developer relations and fixing bugs sooner.

“We want Facebook to be responsive and move as quickly as we can,” he says.

Though, Marini notes that in other areas Facebook already moves extremely fast and continues to innovate. He sees the company making big strides in mobile this year.

“I think it’s going to go from good to great,” he says. “I think they have a lot of focus to really make an enhanced experience there.”

Marini says the IPO gives Facebook the financial flexibility to attract top talent and do more deals like the Instagram acquisition so that it can stay on top of trends. As far as monetization, he says Facebook seems to be paying the most attention to advertising, though they’re looking at ways to monetize the platform better. For example, Facebook has said it might reduce the 30 percent fee it takes from developers using Credits for payments.

“For companies like BranchOut, that 30 percent doesn’t make sense,” Marini says. “Facebook gets this.”

Overall, Marini believes Facebook will continue to operate with a long vision of the future, not for short-term gain.

“They’ve made it clear they’re not going to manage the company quarter by quarter,” he says. “Mark [Zuckerberg] wants to focus on product innovation. Sheryl [Sandberg] will continue to focus on the business side.”

Read Part 1 with Clara Shih of Hearsay Social
Read Part 2 with John Corpus of Milyoni
Read Part 3 with Hussein Fazal of AdParlor 

Facebook launches standalone camera app for iOS

Facebook today released Camera, a standalone iOS app that lets users take photos, add filters and share them on the social network. It also includes a photos-only feed.

The app, which sounds a lot like Instagram, was developed by Facebook alone since the Instagram acquisition has not yet closed. Camera is now available in the App Store, but there’s no word on a release for Android yet. A recent update to Facebook for Android included a shortcut to the camera within the main app, but it did not have all the features of the new iOS standalone app. [Update 5/24/12 11:57 a.m. PT - Previously this story said that Facebook for Android still included a camera shortcut. We have corrected it since a more recent version of the app removed the shortcut features.]

On first impression, the most useful aspect of Camera could be the bulk upload feature. The main Facebook for iPhone app does let users add photo albums or attach multiple photos to a single post, but most users are unaware that this is possible. The process is also pretty slow. The standalone Camera app seems to have sought to improve this.

The launch of a mobile photo-sharing application is a bit of a surprise considering Facebook’s recent $1-billion purchase of Instagram. Screenshots of a Facebook photo app leaked last summer, but when the app didn’t launch and the social network bought Instagram, we figured the company had moved on. Facebook says that it will continue to let Instagram operate under its own brand and allow sharing to networks like Twitter. If Camera takes off, Facebook could ultimately merge Instagram with the app.

This is third standalone app from Facebook. In addition to the main iOS app, Facebook offers Messenger and Page Manager. We can imagine the company continuing to develop standalone apps to provide additional functionality without bogging down the main app, while also gradually taking over users’ home screens on iOS and Android devices. For example, Facebook could develop an events app that makes it easier for users to organize spontaneous meet-ups and find out what their friends are doing. This could be separate or combined with a location-based app that helps users find their friends and new people around them, similar to Glancee, which Facebook acquired last month.

See screenshots of Camera below:

Facebook testing global/regional fan pages that share a single Like count

Facebook appears to be testing a way for pages to customize their presence for different regions while maintaining a unified total Like count across all pages.

It seems users who visit a page will be automatically directed to the version specific to their region, but they can access any regional or global page through a drop-down menu. Many pages have amassed large global fan bases, but any given post reaches a small subset of those people. Sharing region-specific content with the right audience can have a big impact on reach and engagement. This latest test allows each page to display the same total fan count, which could encourage brands and organizations to expand their regional efforts without worrying about the perception of having pages with a low number of Likes.

Earlier this year a study found that posts from local branches of a business generate reach five times the percentage of fans as a post from a corporate page. The study also found that local posts see engagement from eight times as many of the fans reached compared to corporate posts. NPR conducted an experiment that used Facebook’s geotargeting feature to post local stories to a smaller, more relevant subset of its fan base, and found that local stories outperformed global stories six-to-one in terms of engagement rate.

We do not yet have details on how regional pages might be created or managed through Facebook, but it seems that these pages can be completely customized with different cover photos, posts, about sections and apps. Although the total Likes will be the same across global and regional pages, each will have its own Talking About This count. We will share more information as it becomes available, but so far this test seems to be limited to Facebook’s own marketing pages, based on what we can tell from our PageData tracking service. See some examples below.

Hat tip to AllFacebook.de, which first wrote about the feature.

Lawsuits and regulatory investigations turn IPO into a black eye for Facebook, underwriters and Nasdaq

Facebook, its underwriters and the Nasdaq exchange continue to face scrutiny over the company’s $16 billion initial public offering, as a number of investors have filed lawsuits and regulators have called for investigations.

Facebook’s stock closed at $32 today, up more than three percent since yesterday but still down from its $38 IPO price. Here we’ll recap the two main issues causing this onslaught of controversy and discuss what has happened so far as a result.

First were technical issues with the Nasdaq, which many claim led to botched trades on Friday when Facebook went public. The exchange had said it would set aside $13 million to cover compensation costs, but Nasdaq OMX Group was then sued on Tuesday by an investor claiming the exchange was negligent in handling orders for Facebook shares. Nasdaq representatives now say that if they had fully realized the extent of the technical problems they faced, they would have delayed the IPO. Facebook is reportedly getting pitches from the New York Stock Exchange to switch its listing.

The other controversy involves underwriters Morgan Stanley, JPMorgan Chase, Goldman Sachs and others, as well as Facebook itself. Reports claim underwriters’ analysts reduced their earnings projections for the social network during the company’s roadshow, but did not make the change widely available to potential investors. According to Reuters, the banks are now forecasting 30.4 percent year-on-year 2012 revenue growth on average, instead of the 36.7 percent growth previously expected. In 2011, Facebook’s revenue grew 87.9 percent year-on-year to $3.71 billion. Another report says Facebook executives were involved in suggesting analysts revise their estimates.

As such, lawsuits have been filed in New York and California on behalf of investors who claim they had a legal right to know about the lower growth forecasts before the IPO. The underwriters, Facebook and its executives are listed as defendants in these suits.

According to Reuters, the U.S. House and Senate committees that oversee financial sector matters are planning to look into the allegations — as are the Securities and Exchange Commission, the Financial Industry Regulatory Authority, and the Massachusetts Commonwealth.

Morgan Stanley said in a statement Tuesday that it “followed the same procedures for the Facebook offering that it follows for all IPOs.” Facebook did not provide comment about the regulatory inquiries, but regarding the lawsuit, spokesperson Andrew Noyse said in a statement, “We believe the lawsuit is without merit and will defend ourselves vigorously.”

Facebook to sell premium ad placement through Ads API, Power Editor

Advertisers will be able to buy premium ad inventory — on the home page and within News Feed — through the Ads API and Power Editor tool rather than working directly with a Facebook ad representative, the social network tells us.

Although the functionality is not yet live, this could allow third-party ad companies like AdParlor, Buddy Media and TBG Digital to continue to serve high profile clients who want more prominent ad placement that wasn’t previously available through the API. It also means Facebook may be able to better scale its premium advertising product without having to greatly expand its own staff.

Many advertisers feel Facebook does not have enough employees taking the time to address their individual business needs. The competition among third-party providers may lead these companies to be more attentive and an increasingly ideal alternative to working with Facebook directly. According to the Preferred Marketing Developer directory, there are 44 companies with access to the Ads API. The Power Editor, a self-serve desktop tool with advanced functionality, is available to some advertisers who request it from a Facebook representative.

In February, Facebook announced new premium ad offerings, including mobile Sponsored Stories, Reach Generator and logout ads. At the time it was unclear how this would affect third-party ad services and software providers, who only had the ability to buy ads that ran within Facebook’s right-hand sidebar. We do not have details on whether all of these premium options will be available through the API or Power Editor, but Facebook tells us it is working on this with developers and agencies now.

[Update 5/23/12 4:16 p.m. - Facebook confirms to us that it will only give third parties access to premium homepage ads within the feed and right rail, not mobile inventory. Logout placement and Reach Generator services will also still need to be managed by a Facebook representative. Since these are newer offerings, the social network is likely looking to manage these ads more carefully.]

Example premium placements soon to be available through the Ads API and Power Editor:

Note that page-post ads such as the one below are only eligible to be shown in the News Feed of users who already Like the page running the ad or who have a friend that does. Ads in the sidebar can be shown to users who do not Like the advertiser’s page or have any other social connections to the brand. 

Facebook settles Sponsored Stories lawsuit without disclosing terms

Facebook today settled a proposed class action lawsuit that contested how the site uses names and images of users in its Sponsored Stories ad product.

The plaintiffs of Fraley et al v. Facebook, Inc. asserted that the social network’s new ad type turns users into spokespeople, and thus entitles them to compensation under California law. The company did not share terms of the settlement in court documents and representatives did not offer comment on the case. Had Facebook not settled, it might have risked what it sees as a major component of its future advertising business.

Sponsored Stories, introduced in January 2011, allow advertisers pay to promote a user’s actions — such as Liking a page, playing a game or sharing a link — to their friends. However, California’s Right of Publicity Statute prohibits the use of another person’s name, voice, signature, photograph or likeness for advertising without a person’s consent. According to Reuters, Facebook claimed it was immune under the law’s “newsworthiness” exemption because the plaintiffs are considered public figures to their friends and their actions on the platform are generally newsworthy.

Some advertisers have found Sponsored Stories to have lower costs and higher clickthrough rates than Facebook’s traditional ads. Earlier this year Sponsored Stories became part of Facebook’s initial steps to monetize mobile usage with these ads now eligible to be shown within mobile News Feed. The company is also testing options for advertisers to create Sponsored Stories that promote Open Graph activity, including actions, such as what users watch, read or listen to. We’ve also seen the social network increase the size and design of Sponsored Stories within the desktop feed recently.

Facebook IPO raises questions for regulators; SEC, FINRA likely to investigate

Regulators suggested today that they will review Facebook’s initial public offering following reports of the Nasdaq’s technical issues and possible violations by underwriters, according to Reuters and the Wall Street Journal.

Securities and Exchange Commission Chairman Mary Schapiro and Financial Industry Regulatory Authority Chairman Rick Ketchum separately told the press that their agencies would be looking into allegations and concerns surrounding the much-scrutinized IPO. [Update 5/22/12 2:27 p.m. - Massachusetts Secretary of Commonwealth William Galvin has issued a subpoena to Morgan Stanley over it discussions with investors on Facebook prior to the IPO.]

Sources tell Reuters that Morgan Stanley, JPMorgan Chase and Goldman Sachs revised their earnings projections for Facebook during the company’s roadshow but did not make the change widely available to potential investors. Business Insider’s Henry Blodget explained that the underwriter analysts reduced their estimates after Facebook had filed an amendment to its IPO filing, which included a note that user growth continued to outpace revenue growth in the second quarter of 2012. He wonders whether Facebook had any direct involvement in the analysts adjusting their projections. [Update 5/22/12 3:02 p.m. - Blodget now says he has sources confirming that a Facebook executive told analysts to lower their estimates.]

Although companies do not release their own financial forecasts before an IPO, they generally provide guidance to underwriters whose analysts determine an estimate. Any information a company offers leading up to an IPO is required to be made available to all potential investors, however, bankers often favor their institutional clients and share information with them before disseminating it to retail investors.

As for issues with the Nasdaq, the exchange experienced a number of technical issues on Friday that could result in $13 million in compensation for bad trades. A number of investors were unable to verify whether their orders went through for several hours.

These problems seem to have led some investors to be more wary of Facebook’s stock, which has fallen to $31 today after initially listing at $38 and going as high as $45 on Friday morning. Shares are down 8.9 percent since Monday and down 18 percent from the offering price.

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