As we detailed in the Ad Watch Year in Review, ad supported casual games are a huge booming industry. Be they on PCs or mobile phones or maybe even on consoles (stay tuned) casual games with ads just seem like a winning combination. Some have referred to it as the "new television" given its propensity for time wasting among the masses and casual gaming companies have no doubt benefited from the recent writers' strike.

Another popular time waster competing with television is online social networks. Whether updating a personal page or messaging friends, much free time (or even work time) is spent on Facebook or any number of other comparable sites. It should come as no surprise that the forces of casual games and social networking websites have come together to scour the Earth of whatever free time people had left over.

We talked with Mark Pincus, CEO and Founder of Zynga, a company on the leading edge of this latest trend of placing game apps within social websites.

Before Dot Com
Pincus has been on the new media frontier since the early '90s. He founded his first Internet company in 1995, later founded SupportSoft and left soon after it went public and then he started Tribe.net, one of the first social networks in 2003. Pincus' latest company started innocently as a decision to make a Texas Hold 'Em application within Facebook.

"[Zynga] just got started as a side-project," admits Pincus. "I just thought it would be nice to integrate Texas Hold 'Em into social networks and add features like the ability to see each other's pictures in the Flash app. I also wanted users to feel like people could always be coming and going like a real casino and we just sort of took it from there. We found ways to make it expand."

"We gave people free chips if they got their friends to join and later chips for initially installing the app," he explained. "Then we found we had more installs then we could sell, so we focused on different games and we eventually saw the potential for an actual network [of games]. We wanted to have features useful to everyone across the various games. People hang out on a social network in an asynchronous way – perhaps doing activities at the same time that other people are doing them but not necessarily doing them together. By contrast, we wanted to make what we were doing a social utility, a way to actively connect with people."

"It's great to hang out with my college roommate or maybe my niece for a few minutes playing one of our games," he added. "We all have these odd moments to ourselves, unscheduled, and I could use these three minutes by playing with someone I know, or perhaps I'll have an interesting experience with a solider in Iraq or someone in a cafe in Lebanon. It's facilitated by Facebook or Devo but we're putting a layer on top of that."

I remember when Facebook was only for college grads...
Casual gaming has a potentially broad appeal, and card games (like Texas Hold 'Em) can be played by almost everyone. Social network sites, such as Facebook and MySpace, are also appealing because of their basic level of accessibility. The seemingly simple equation of combining the two gives Zynga great potential for taking off.

"Part of what we're doing is letting people play very basic games," said Pincus. "Because we're not from the game industry, we're not trying to build a 'cooler' game than the next guy. It's not so much the gameplay that's appealing as how the game is a facilitator of the experience itself. It's kind of like what Nintendo has with the Wii; they have silly basic games, like bowling, tennis and boxing, and it's really appealed to a wide audience. We see what we're doing as going in a different direction."

"I think of sites like Facebook and the open API movement as similar to what AOL was in the late '90s," he continued. "There were all sorts of cool stuff on the web, but the mass market was getting it through AOL. AOL would integrate it all and make it available and safe. That's what Facebook is doing; they're integrating things and making it available there. You don't have to go to some far flung website; you can do it from there with your friends. It's important, because a lot of Web 2.0 hasn't made the mainstream because of availability."

Zynga is named after Pincus' bulldog, BTW
Of course, you can have as successful a game on a social network as you want, but it's going to get crushed under the weight of its own traffic if you don't have proper advertising support. For Zynga it's been a slow maturation process, trying to find the right ways to offer advertising. The company has finally started settling into some solid revenue methods, however.

"Our model is that we sell in-network ads, so they pay us by install [of our app]," detailed Pincus. "They can pay us by the number of installs and we also can install a number ads on a cost per click basis. We think in the future we'll test CPM as well and any gaming advertising companies that want to test out our ads, we're happy to do it with them."

"You're not leaving the browser with the download of our app and you can 'take a turn' and be done with playing a session of our games in three to 10 minutes," commented Pincus on the appeal of Zynga to advertisers. "The problem with most games is that they're too sticky and people never leave; you only make money when people leave and come back. It lends itself much better to clicks."

Pincus seemed very optimistic for the future and for larger gaming companies entering Zynga's field. "They [already] are in some very small testing ways," he said. "[For example,] EA has Smarty Pants, which is a social game app. Ultimately, I think this will be a major distribution platform for those companies. I think it will be great for them to bring their established brands and their new stuff to it and we hope to partner with those companies."