After beta testing for almost a year, the Facebook Credits API is finally being opened to all developers. Before beta testing the service had been in very limited alpha testing for over six months before that. On July 1st, more than two years after the social networking site started working on the system, all Facebook-based games that process payments will be required to use only Facebook Credits. The 350 applications granted early access already account for 70% of such transactions. Facebook credits can be purchased by users at a rate of $0.10 each (with an additional 10 free when buying 100) and redeemed by application developers for $0.07, leaving Facebook with the balance.
It's no surprise that Facebook wants in on whatever money changes hands for virtual goods in popular games that run on its Platform (22 of the top 25 of them, apparently). From the announcement and Documentation it does seem like the main focus of the initiative is gaming. After all, Facebook Credits are very strictly virtual currency. The program terms are clear that developers "may not accept Credits as payment for tangible goods." It follows that most of this pretend money will be spent in pretend contexts.
But games are still serious business. No matter how fancifully Facebook credits are spent, it's clear that a great deal of work went into the system over its two year development. The API is extremely detailed, including features as specific as programmatic methods for dispute resolution with dissatisfied customers. The Credits API also comes with some of the most thorough documentation available on the Facebook developers site, which isn't always the best at providing such resources.
Tellingly, the detailed technical explanation of the new API isn't all Facebook has released. There's another page that includes nothing about practical implementation, but instead discusses increasing revenue, decreasing cost, and growing your business along with compelling quotes from executives at companies turning a profit with Facebook Credits. There are even links to download multiple case studies about such success stories.
It might be at the developer sub-domain, but these resources clearly aren't aimed at developers. There's no question that Facebook isn't just interested in cashing in on existing games, but also looking to actively promote credits to new companies and entrepreneurs. Not only that but Facebook is working on ways to profit from credits that go beyond charging a fee to cash out virtual arcade tokens to developers.
Though the example at the developer site is already sold out, Facebook is offering novel online advertising that pays users (in Facebook Credits) to watch short video ads. This initiative comes out of a collaboration with TrialPay, a "transactional advertising" company already working with Facebook on promotions that offer shoppers credits for certain purchases.
It's an impressively self-serving model—Facebook sells brands and companies credits to bundle with purchases as an incentive and the credits can only be redeemed by users spending time on Facebook in front of games with other, display ads running along next to them.
Facebook has probably kept an eye on the 150 or so developers given access to its credits system early. With the floodgates now open, there will be far more applications handling users' money, even if it is in virtual form. Of course, that's what Facebook is hoping for, but it doesn't mean that it will be easy to manage. With money to be made, the sizable Facebook developer community will no doubt push the envelope both in terms of what's possible and what's allowed. Considering that Facebook itself seems to have mini-crises about privacy and user confidence on a regular basis, it seems like Facebook Credits may have a bumpy road ahead of it.