
Zynga Stock Dives as Facebook Keeps Backing Away - lleims
http://www.wired.com/business/2012/11/zynga-facebook-chill/
======
jrosenblatt
Sure, ZNGA went down 6% yesterday, to about the same price it was on
Wednesday, which is still 15% more than it was a couple weeks earlier.

Not sure about Zynga as a company, but it's easy to overreact to the market's
reaction to this news.

~~~
travisp
Even though this is Wired, this is typical of financial reporting: to take a
single day of price movements and write whole stories about them, completely
ignoring larger price movements or alternative explanations. I've even seen
news articles about stock market movements changed after the price swung from
negative to positive in the same day... but the article kept the explanation
for the price movement essentially the same! My guess is that this Wired story
would have found a way to be written regardless of what the stock price did.
But, getting to say that it "dove 7%" makes for good headlines (even if soared
8% just the day before, meaning that it just "dove" back to its original
price).

While I don't think Zynga is a great company to invest in, its stock price is
very volatile, which probably makes for good frequent attention grabbing
headlines. Sure, this news was part of the reason the stock price was down,
but apparently market price setters still think the company is 13% more
valuable than it was 30 days ago.

~~~
hosay123
One of the early innovations of Bloomberg was to totally automate certain
classes of news story, driven entirely by data. As you can see from spending
any length of time browsing Google Finance, the number of this class of
stories in the present day is absolutely huge, from a wide variety of 'news'
outlets.

"Top movers! Miners down 0.00001% as fears grow over
$calendar->getNextECBAnnouncement()"

What's more terrifying is that Google Finance even syndicates these articles,
and that people trade off of them - "informed" traders, buying and selling
based on articles that are quite literally generated from sampling noise

~~~
JumpCrisscross
Do you have a reference for this? As someone with a Bloomberg terminal I've
found their wire service completely free of that kind of junk more typical of
tech journalism, MarketWatch, or StockTwits.

~~~
hosay123
Bloomberg mentions it in his autobiography (Bloomberg by Bloomberg) while
Taleb mentions encountering similar stories on his Bloomberg terminal in
Fooled by Randomness.

------
minimaxir
It's worth noting that Zynga has diversified revenue streams other than the
games themselves: they have a pending Draw Something TV show [1] _and_
physical merchandise [2].

That probably won't be enough to save the company, though. It wouldn't
surprise me if Zynga pivots into a Rovio.

[1] [http://www.tvguide.com/News/CBS-Draw-Something-
Pilot-1048932...](http://www.tvguide.com/News/CBS-Draw-Something-
Pilot-1048932.aspx)

[2] <http://i.imgur.com/OZSZb.jpg>

~~~
antr
can you point me to the estimated revenue numbers?

if zynga wants me to consider this going fwd they need to throw potential
investors a bone. such "revenue streams" with no quantitative backup is plain
speculation, water cooler chitchat.

~~~
podperson
I think the idea is that each player gets their own revenue stream and clicks
on it until it gets bigger. You can share your "earnings results" with friends
and trade rare revenue stream features, and there's a kind of limited PvP
setup where you can pit your revenue stream against another player's and click
a bunch of times and one of your revenue streams gets bigger.

------
AznHisoka
We should all short Zynga. Zynga has nothing special, no competitive
advantage, no intellectual capital, no special sauce to maintain their market
share.. and what OTHER social platforms are there for games? Twitter? Google+?

"Oh, our plan is to launch poker in the UK!" Um.. ok, and compete with 10000
other companies that had a decade head start and know all about the online
poker business. Good luck with that.

~~~
zaidf
_Oh, our plan is to launch poker in the UK!" Um.. ok, and compete with 10000
other companies that had a decade head start and know all about the online
poker business. Good luck with that._

I think your reasoning is perfectly logical and yet, it sounds similar to all
the VCs who turned down google back in the day because _hey_ all these other
guys had been doing search for years so how can you compete with em? You may
argue that Google actually had a plan to compete with them to which I'd ask
you in how much depth you have researched Zynga's poker plans before reaching
the conclusions in your post.

~~~
jorts
While I don't think the Google Search : Zynga Poker comparison is fair, I
think that your comments' parent has a valid point as the online gambling
market is pretty saturated. It would be interesting to see if they can do
something innovative for the online gambling marketplace.

~~~
RobAtticus
Probably a long shot, but should online gaming ever come back to the US (and
perhaps this will work in other markets), maybe Zynga can position themselves
as the choice for casual gambler. If they can convert a bunch of their
Farmville, etc users into playing poker, it could make for some very soft
games. I don't think you'll see them as the place to be for serious players
who want high limits or lots of different tournaments/options, but something
that even the most casual of poker players/gamblers can be very lucrative (as
well as draw in low/mid limit sharks who want easy cash). This all depends on
the premise that the friction from being a player of one Zynga game to being a
gambling player on a Zynga game is less than being a player of a Zynga game
and also joining an unrelated gambling site.

------
jasonkolb
Facebook will be able to buy them for the price of a taco soon.

~~~
w1ntermute
A virtual Facebook taco, at that.

------
macspoofing
Yeah Zynga sucks but this is another cautionary tale of relying on someone
else's (web) platform.

~~~
Karunamon
Not really. Zynga isn't failing because they were screwed by a Facebook policy
change or really anything Facebook themselves are doing (unlike, say,
Twitter's recent API brouhaha), but because of their business model. AznHisoka
in this thread said it better than I can; they have nothing to build a
business on.

~~~
macspoofing
Facebook changed their platform right underneath them.

------
hayksaakian
Well that was completely unexpected...

Said no one ever.

------
wilfra
I don't understand why the market reacted negatively to this news. There are a
number of positives:

-They don't have to use FB credits -They don't have to use anything FB on Zynga.com -They got a guarantee if their is real-money gaming on FB.com, they have to be allowed in

So what if FB can now make their own games? They aren't going to.

------
wow_that_sucked
good fuck you zynga. My first taste of their shitty ways, was just the other
week. lidgren - is the best open networking library available for indie gamers
and this fuck, goes and duplicates the code base, re-releasing it on a
separate source control site. THEN he mails the group, including the author,
asking for permission.

After hearing about this, the author understandably is concerned about
splitting the dev hub of his code across multiple sites, and its community,
culminating in him saying this is not a good idea.

The stupid fuck, replies saying he already has done it, and matter of factly
states it is getting quite popular.

Community hits back, tells him it is detrimental to everyone, and asks him to
take it down. Eventually after a few days of building pressure, he does.

I was curious, did a little research. Turns out the dickhead was an important
dev from Zynga.

I have omitted names.

Fuck Zynga.

~~~
kt9
Its understandable that you don't like zynga but this post isn't constructive.
In general terms rant != cool.

~~~
yesimahuman
Also, as far as I can tell the license is MIT so he can pretty much do
whatever the hell he wants with it. Open source goes both ways.

~~~
wow_that_sucked
the point of the rant is that he was a dick

~~~
bdcravens
I feel you, but there's some serious dicks in the open source community as
well. It seems the same behaviors somehow have different meaning if they're
attached to a company that it's popular to dislike.

~~~
bdcravens
See my comment got down voted, and rereading it, I can see why. I wasn't
saying that all that everyone in the open source community is a dick, but
rather, a person can be a dick no matter who they work for. Nothing intrinsic
about who they work for, or whether they're part of the OSS community.
However, there seems to be a confirmation bias when it's a company we're
predisposed to dislike.

