Microsoft Research has launched its first Facebook game, known as Project Waterloo, and is using it as a launchpad for a platform for behavioral game theory on social networking sites.
The Research Games team is focused on "testing the behavior of real people in game theoretic interactions in social networks" and is exploring topics like how people negotiate with one another, how behavior reciprocation works and how individual opinions are aggregated.
"The ways in which people interact, socialize and communicate have dramatically changed in recent years due to internet-based technologies," said a Microsoft Research page about the Research Games team. A couple of the researchers on the team have strong links to advertising, indicating at least some of the potential financial motivation behind Microsoft's explorations in this area.
"This is (Facebook Game Theory Lab) platform that would allow us to carry out experiments in which people interact with their friends in a set of games, designed to examine the strategic interactions that occur in a principled way. Example games are competition and resource allocation games and negotiation games. This way we can examine where peoples’ behavior differs from predictions from classical game theory, and devise tools to better predict the behavior," the site explained.
The team is hoping to capitalize on Facebook's viral-marketing mechanisms so as to be able to observe a large study base and to analyze better the "playing field" of the social graph. "The artificial 'lab setting' of traditional experiments in behavioural game theory is replaced by the natural social habitat of the subjects, their circle of friends," the research page notes. (With Facebook's now greatly expanded "Open Graph," things might get even more interesting for Microsoft researchers around the social graph.)
Project Waterloo is just one of a number of social/casual games with which Microsoft has been dabbling increasingly across the company. Microsoft also introduced a social-gaming toolkit for Windows Azure in July.