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Perhaps more significantly, Zynga's massive audience is showing signs of fatigue with the inane forms of entertainment that have earned the company so much money. FarmVille's 62 million monthly users represent a significant drop from the application's peak of popularity. FishVille now has about 9 million monthly users, down from a high of 26 million.
A consensus has formed among industry observers that Zynga needs to be on the lookout for its next blockbuster. "Zynga is now a studio, and it should be looked at in terms of its financial future as a studio," Martino says. "And if a studio can't produce hits, it will eventually suffer impairment to its financial situation."
One of those preparing for a future in which Zynga's brand of simplistic entertainment no longer holds sway is Alex St. John, president and chief technology officer at Hi5 Games, a website trying to establish itself as a hosting platform for more sophisticated social games. He predicts that "a second generation of games" will overtake the wildly popular suite of mafia-style and "Ville" applications that have so far dominated the web. "FarmVille's audience has collapsed," he says. "There's a perception that Zynga has a very large audience. Zynga itself is completely dependent on Facebook — for its audience, for its monetization. Nobody wants to play the games outside."
According to St. John, the new generation of social games will have more depth. Such apps could prove better able to hold users' attention over time, and their complexity would serve as a safeguard against the kind of profitable copycat-ism perfected by Zynga. "The only way to make games that are highly defensible" from copyright infringement and user boredom, he says, "is to make the gameplay richer and more sophisticated, or the business model richer and more sophisticated."
It may be that Zynga is starting to figure this out. The company's latest release, FrontierVille, is basically FarmVille moved to a Davy Crockett-style American outback. But it does feature a wider range of gameplay options — from simple missions, such as bringing a wife out West, to activities like clobbering snakes and scaring off bears — that distinguish it from the mind-numbing repetition that characterizes FarmVille.
One former Zynga game designer, speaking on condition of anonymity, says he has kept in touch with former colleagues who say the company has hired high-caliber designers and adopted a new emphasis on original content and more sophisticated applications to draw in, and keep, users.
"They've brought in people who know games, which is why FrontierVille is a much better game than what they've generally put out in the past," he says. "They've moved somewhat away from the startup model and seem to have much better structure, from what I've heard from people still there. Of course, the real question is whether they can actually get the company value up to the point it needs post-IPO. Pincus will undoubtedly make his money and take off, as he has before, and the company's bubble will burst." Zynga's roughly $600 million in venture-capital funding, he adds, is "a lot of investment to show value for."
Zynga has pivoted before. Its three successive hits — Zynga Poker, Mafia Wars, and FarmVille, with their various spinoffs — each involve essentially different styles of gameplay. But none of those styles originated at Zynga. FrontierVille might be a step in the right direction, but it's a small step. The game is still a variation on a well-worn theme, and to date has attracted 37 million monthly users — about 40 percent of the audience FarmVille enjoyed at its height of popularity. To continue dominating the social-gaming gold mine, Zynga might soon be forced to do something it has avoided in its short and celebrated history: innovate.