Inside Facebook

Founded by PayPal co-founder Max Levchin in 2005, Slide has become synonymous with the explosion of social network applications in recent years. Its properties and widgets, including popular applications SuperPoke, Top Friends, FunSpace, and SuperPoke Pets, reach over 155 million people per month on popular social networks like Facebook, MySpace, Bebo, Hi5, Orkut, Friendster, and Tagged. And with around 24 million monthly active users on Facebook, Slide is (and always has been) one of the largest application developers on the Facebook Platform.

However, unlike other top app developers, Slide hasn’t been rolling out many new applications over the last year. Instead, it’s been honing and optimizing its core network of properties, and spending a lot of time and energy tuning its monetization efforts.

On the advertising side, Slide has built a sales team with several staff in New York and San Francisco that has been driving the company’s premium integrations like branded SuperPokes or viral FunSpace videos. However, the company has also quietly been building its direct to consumer business, selling virtual currency and subscriptions that give users access to premium features. For example, each bar of Slide Gold costs USD $0.10 (the same exchange rate as Facebook Credits), and unlimited premium SuperPokes can be purchased for a USD $4.99 monthly subscription fee.

Just how important has Slide’s virtual goods business become? As of today, a Slide spokesperson tells us its direct-to-consumer virtual currency sales and subscriptions account for 50% of the company’s overall revenues.

Furthermore, given the increasing importance of virtual goods sales to the company - and that Levchin, CFO Kevin Freedman, and VP Strategy and Business Development Keith Rabois all share a history at PayPal - we’ve been hearing increasing rumors lately that Slide has plans to bring more parts of the payments layer in house in order to be able to exert greater control over the payment user experience. Today, Slide confirms that that is indeed the case.

“We believe it’s important to improve the system for paying for virtual goods. We are working on innovating that technology to make the experience easier for our consumers,” Lily Lin, Slide’s Director of Communications, tells Inside Facebook.

Whether or not Slide will make its payment infrastructure available to other developers remains to be seen. Slide’s Lin, however, says that that is “not the plan.”

“The focus is just for our own users,” she says.

For a company like Slide, which has 150 million users around the world yet connects with many of them through social network platform partners, taking greater control over the payments infrastructure, which is of increasing strategic importance to the company as it grows its direct to consumer sales, makes a lot of sense. Unlike smaller developers, it has the resources and experience to potentially establish direct relationships with payment processing companies instead of working with social application payment service providers like Social Gold, Spare Change, Zong, or Boku - or the social networks themselves. (Facebook recently started testing a payments program for developers, and MySpace has said it plans to do the same later this year.)

Overall, we think these are all smart moves by the company. Virtual goods sales are booming on the Facebook Platform, and Slide is in a unique position to capitalize on both the advertising and e-commerce opportunities inside Facebook. We’ll continue to track the company as things progress on both fronts throughout the year.

This weekend at SXSW in Austin, Facebook’s Dave Morin announced the launch of Facebook Connect for iPhone. Now, iPhone app developers can integrate Facebook Connect natively into their apps so users can easily connect and share game content with their Facebook friends from inside the app. Facebook Connect for iPhone is a big step forward in the advancement of the social web because it bridges the social graph, identity, and privacy of Facebook with the rich, mobile application platform of the iPhone for the first time.

However, unlike some may think, Connect for iPhone doesn’t just create new opportunities for Facebook application developers to expand their reach to the iPhone (though it certainly does that too - companies that were large on Facebook before the iPhone like Flixster, SGN, Zynga, and Playfish are already showing the power of a cross platform mobile and social app ecosystem with the strategies behind their iPhone Facebook Connect integrations they launched this weekend).

Rather, it also offers significant new opportunities for iPhone app developers to create new kinds of engaging social interactions and powerful viral growth by connecting their applications to Facebook’s social graph and feed system for the first time. We’re going to see lots of interesting new and improved applications coming from iPhone app developers in the upcoming weeks and months that take advantage of both the social graph to create more compelling experiences and the power of the News Feed and invitations to create more powerful viral loops.

Take Urbanspoon for example, of the highest rated restaurant review applications on the iPhone that announced Facebook Connect integration this weekend. Urbanspoon has already added a “Friends” feature that lets users share their ratings with Facebook friends and see what their friends have done on Urbanspoon lately. The potential for this type of interaction to become very engaging and viral is quite high - especially as Facebook adds more support for all the communication channels on the iPhone that Facebook Platform application developers have been using for some time.

We’re only at the beginning, but Facebook has opened the door for iPhone app developers to create some seriously social mobile applications. Which iPhone developers take advantage of these opportunities most quickly will be interesting to see.

While there was certainly a lot of media coverage around Facebook’s decision to revert its terms of service a couple of weeks ago, few Facebook users decided to leave Facebook because of the concerns, according to data released by Compete.

While user visits to the Terms of Service document more than tripled in the week before Facebook announced its new Terms of Service governance process, account deactivations only rose slightly above their normal levels:

While this is third party data (and thus pretty rough), it does generally show that relatively few Facebook users were so concerned by the events of the past few weeks that they decided to deactivate their accounts. After Facebook reverted its terms to the old version and announced the new site governance process, these metrics went back to normal.

For those tracking Facebook’s international growth, 2009 is continuing where 2008 left off: Facebook is growing quickly in a lot of countries around the world. Facebook’s international growth has major implications for other social networking platforms around the globe, like Bebo, MySpace, Hi5, Friendster, Orkut, StudiVZ, and dozens of others, as well as for global brands and marketing firms evaluating Facebook as a communications platform.

Inside Facebook is tracking Facebook’s 2009 international growth closely. Our monthly Facebook Global Monitor reports provide detailed insight into Facebook’s international growth trends. Here are some interesting statistical highlights from Facebook’s January growth metrics:

• Almost 1 million people in Italy, or over 1.6% of the national population, joined Facebook in January.
• Over 500,00 people in Spain joined Facebook in January.
• The number of people on Facebook grew by over 10% monthly in 52 countries in January. It grew by over 20% monthly in January in 13 countries.
• Facebook’s monthly growth accelerated by at least 25% in 30 countries in January vs. December 2008.
• The number of Facebook users in Indonesia grew by nearly 40% to over 1.1 million in January - the fastest of any country.

We’ll continue tracking Facebook’s international growth as 2009 progresses!

Friendster, the biggest social network in Asia, will announce later this evening that it is expanding its application developer program by adding support for the Facebook Platform API. With tonight’s launch, Friendster will be the first social network to have implemented support for both the OpenSocial and Facebook Platform application development standards. Friendster launched OpenSocial support just this August, after implementing its own application platform in 2007.

The Friendster launch is a big opportunity for Facebook application developers interested in Asian markets. Facebook developers will be able to easily port (most parts of) their Facebook applications over to Friendster with very little work, gaining access to Friendster’s audience of 57 million users. According to comScore, Friendster’s user base only has a 22% overlap with Facebook’s, so Friendster offers access to an audience largely untapped by most Facebook developers.

In addition, Friendster is less restrictive about which parts of the application can be monetized. Developers can put ads on any real estate they control, including the profile page.

Facebook Platform API categories that will be supported as of launch tonight include: users, friends, notifications, photos, FBML, FQL, authentication, requests, and profile. The news feed API will not be supported, but it will be in the future. Friendster’s Director of Marketing Jeff Roberto says that Friendster intends to keep its Facebook Platform implementation up to date with Facebook’s, but it will just take a little more time to initially get in sync.

“Our vision with the developer program is to build a very open platform and to make it easy for developers who have built on common standards like Facebook and OpenSocial to deploy on Friendster,” Roberto says. “We will maintain our Friendster APIs, Facebook APIs, and OpenSocial APIs.”

Friendster becomes the second major social network to license the Facebook Platform API under the Facebook Open Platform (fbOpen) initiative. Late last year, Bebo launched its platform using Facebook APIs, shortly before being acquired by AOL.

Friendster, which has risen to become the largest social network in Asia after its precipitous fall in North America years ago, is today announcing  support for OpenSocial 0.7 as part of the Friendster Developer Program.

The Friendster app platform actually launched in late 2007 - it was the second social network to launch a platform after Facebook. Since then, thousands of developers have joined the Friendster Developer Program and about 500 apps have been released on the Friendster platform. Friendster told us today that 10 million unique users have installed at least 1 application so far, and half a million apps are installed every day. Of those who have installed applications, the average is between 2-3 apps installed per person.

Friendster’s Jeff Roberto says that the company will continue to support existing APIs as it adds OpenSocial support. “We plan to support both. This is really an extension of the Friendster Developer Program to developers of OpenSocial applications, who should now be able to run their apps on Friendster out of the box. We’re the only place that app developers can reach 55 million unique users in Asia on a single social network. And we have very low overlap with other social networks.”

Friendster’s platform as an open revenue model, meaning developers are free to monetize their apps however they like. One unique aspect to monetizing on the Friendster platform is that ads on the profile page are permitted - unlike other social networks.

“Friendster’s launch is another major milestone in the adoption and deployment of OpenSocial throughout the social web and around the world. We’re particularly excited that OpenSocial is helping Friendster bring new social applications to users in Asia, and we look forward to seeing users embrace these apps,” said David Glazer, director of engineering at Google.

Roberto says that while the company is not ready to announce specific dates yet, Friendster does plan on supporting the OpenSocial 0.8 spec. OpenSocial 0.8 adds REST API support - like the Facebook Platform does - something OpenSocial developers have been clamoring for for months.