Research Labs.

Peanut Labs co-founder Ali Moiz will be speaking at the up coming FailCon Conference on Tuesday, Oct 27th.

FailCon is a full-day event focusing on the trials and tribulations of successful entrepreneurs. Since most successful entrepreneurs have had to deal with some sort of failure one way or another, FailCon was created to highlight these failures and  how to recover from them financially, emotionally, and practically.

During Ali’s 4pm speaking spot he will be highlighting missed opportunities and mistakes by Peanut Labs. The missed opportunities came on the assumption that certain advertising wouldn’t work with end-users. This made the company hold back on expanding the Survey/offer inventory into other advertising areas, and allowed competition to surpass.

Some other question that will be addressed during FailCon:
* How do VCs handle failing investments?
* How NOT to build a social app
* What are some social web branding failures, and how can you avoid them now?
* How do you financially prepare for the possibility of failure: legally, fiscally, and in your team?
* What have some of the leading executives today learned from their past experiences?
* What are you watching out for with the current social web and rising companies?
* How do you recover from a failed product or marketing campaign?
* And how do you let it all go if you must?

Ali will be speaking at 4pm in the “Stories from the Field” section of the event. For a 25% discount on tickets please click the link below.

http://snapsummit4.eventbrite.com/?discount=RFoP25>

Zynga’s “Café World” began its first week with gaining 8.6 million users. This is an astounding number for a Facebook application that was just launched. Zynga, the leading facebook game application developer, has once again hit gold with their own version of online restaurant management. Below you can see their growth curve and how quickly the application caught on.

Café World is an Application that puts you in charge of your own restaurant. From hiring your staff (other FB friends) to cooking the food. Your success as a restaurant owner is entirely in your hands, similar to Playfish’s Restaurant City, with a few slight differences.

Zynga’s success with their Cafe World application has evolved mainly on the heels of their incredible knack of cross promotion. With successful applications like Mafia Wars, FarmVille and YoVille, the chance that users are going to use their newer applications increases substantially. Here are some examples of how Zynga is cross promoting.

The easy to use built in bar below allows Zynga application users to easily navigate form one game to the next.

They are also directing traffic by allowing users who might be getting tired of one virtual setting, to move onto the next.

With Zynga’s Applications like Cafe World growing at such a fast pace, and with word of them going public, their innovation and dominance should lead the Facebook application world for some time to come. And for any other company that develops a game that gets traction, Zynga has the ability to come in and do it better.

Justin Smith, the founder of Inside Network, and Charles Hudson, VP Business Development of Virtual Goods Summit, are releasing a report tomorrow analyzing and forecasting the US Virtual Goods Market. Charles and Justin spoke with dozens of execs and entrepreneurs from all parts of the Virtual Goods ecosystem to gather data and information to help them materialize their report.

This will be one of the first times in the US someone has broken down virtual goods detailed estimates, analyses and predictions for 2009 and 2010. The Report is designed for entrepreneurs, investors and analysts interested in the growth of online commerce and is broken into four sections.

Social Networks, Applications and Games:

Casual MMO’s and Virtual Worlds:

Hardcore MMO’s and Free-to-play online games, and Emerging Areas:

Consoles, iPhone and subscription MMO’s:

Each of these sections will contain A brief history of the evolution and growth of this space in the US, estimates of the size of the market in 2009, and a diagnosis of the opportunities and issues of that space, including outlook and prediction for 2010.

This report is something many people in this business are going to need to get their hands on.

To learn more or to purchase this report early, click the link below.

http://www.insidevirtualgoods.com/us-virtual-goods/

China’s press and copyright authorities have banned foreign investors from operating online games “in any form” in the country. The announcement came Saturday from China’s General Administration of Press and Publication and the National copyright administration. Foreign businesses are banned from investment in online game operations either through wholly owned enterprises, joint ventures or cooperatives, according to the website China.org.cn.

The ban is so water tight that it even prohibits foreigners from controlling gaming companies through agreements or providing technical support. In a recent attempt to crackdown on online games operating illegally and featuring unhealthy contents, the Administration shut down 45 overseas online games run without prior approval, according to China.org.cn.

In addition to cracking down on foreign companies interests, restrictions were put in place for domestic gaming businesses, making it illegal to run an online gaming business without permits.

With the online gaming industry exploding, the Chinese government definitely wants to keep those profits in house, without any foreign entity reaping the benefits.

Entertainment, Online Research & Communication account for over 50% of all online activities while levels of Online Shopping & Payment are still comparatively low. Online Gaming grew by 30 Million users and in total 181 Million Chinese netizens now write their own blog. Here is a more detailed ranking of what Chinese people are actually doing online:

• Music: 85.5%
• Network News: 78.7%
• Instant Messaging: 72.2%
• Search Engines: 69.4%
• Video: 65.8%
• Online Gaming: 64.2%
• Email: 55.4%
• Having Blogs: 53.8%
• Forum/BBS: 30.4%
• Online Shopping: 26%
• Online Payment: 22.4%
• Online Stock Speculation: 10.4%
• Travel Reservation: 4.1%

Recently, eMarketer published a chart showing the percentage of people using social networks according to country. The data from September 2007 and September 2008 can be compared. A large majority of countries showed an increased in users from 2007 to 2008 – some substantially. The percentage of internet users who visit social networks could even be higher than what is represented below because the chart excludes traffic from public computers and access from mobile phones and PDAs.

The last post focused on the decrease of users visiting the majority of top applications on Facebook. To clarify, this does not mean that social networks are doing poorly. In fact, as a whole, social networks are growing. Compete.com, which provides user traffic within the United States, shows that between June 2008 and October 2008 Facebook, Bebo, Orkut, Ning and hi5 all had an increase in US traffic. The chart below outlines the US traffic for many social networks, as well as the percent change experienced during the time frame.

This graph shows the percent change of US traffic for each social network.

Worldwide social networks are also growing.

The chart below shows the worldwide growth experienced by social networks for the first half of 2008. Facebook and hi5 had the most new visitors (34,313,000 and 24,939,000 respectively).

According to Mark Zuckerberg, more than two hundred million dollars have been invested in Facebook applications as of July 2008.  But is it a good investment if the number of unique monthly users visiting Facebook applications is decreasing?  I found that the average change in an application’s unique monthly users from September to October was a decrease of 87,997.  All over the internet, people are stating their opinions on what they think is happening to the Facebook platform.  The data that I found, which is illustrated below, suggests that Facebook applications are losing popularity, which could mean a huge loss of money for those people who have invested in the applications, as well as businesses which depend on people using these applications.

A review of a recent one month period showed that 66% percent of the top 250 Facebook applications experienced a decrease in the number of unique monthly users.  Out of that 66%, 16% was a decrease of more than 50%. On September 9, 2008, I entered the number of unique monthly users into an Excel sheet for the top 207 Facebook applications (ranked by unique monthly user).  Then, one month later, on October 12, 2008, I did the same for the top 200 Facebook applications on that date.  Of course, there were some new applications that had not appeared in September, 42 to be exact. To make the graphs and compare the data, I had to fill in data that I did not have.  There were applications that appeared in the October list, but not on the September list.  For these applications, the number of unique monthly users in September was unknown, so I used the value of 200,000.  I also entered 200,000 as the value for the applications that were in the top 207 in September, but did not appear on the top 200 list for October.

The declining traffic that Facebook applications are experiencing is important to the many people who built businesses around these applications and within social networks.  There are many possible reasons for this decline.  A popular opinion is that the decline is a result of the new Facebook design which was implemented in July.  There are so many applications that are very similar, like the ones that focus on sending gifts to friends.  There is not much to these applications and how many flowers, chocolates, hugs and toys can you send to friends before the novelty wears off?  When looking at the top fifty applications in September (ranked by unique monthly users), the one that grew the most, in terms of both number of unique monthly users and percent change, was Causes.  Causes unique monthly users increased by 4,641,318, which is a 156.83% growth.  Maybe people got tired of living a virtual life and instead are spending time online raising money for charities.  Or it could be that giving to charities is becoming popular and people are getting more recognition among their friends for giving money to charity rather than doing well in a virtual world.  Finally, Facebook traffic could just be leveling out. Just in the past year from September 2007 to September 2008, Facebook’s unique monthly users actually increased by over 15 million.  Sooner or later there will not be as many new people visiting Facebook, while there will still be people leaving.