Facebook: Google can charge less because Google+ has no users
Last week, Google added games to its Google+ social network, and then Facebook updated its gaming platform later the same day. Since Google+ Games only started off with 16 titles, made by 10 game developers, and Facebook has developers from more than 190 countries building apps and games on its platform, Google decided to start a price war with Facebook. Now Facebook is saying Google did so because it is the underdog.
Google knows it needs to win over developers to get games on its new social network, so it is undercutting Facebook on the commission price for in-game transactions. Facebook charges a 30 percent commission on any transactions that use its Facebook Credits virtual currency, which is now required in all games on the company's platform. Google has decided to start off with a 5 percent commission for Google+ Games.
"Google has emulated aspects of our system, which is what they have the right to do," Sean Ryan, Facebook's director of game partnerships, told CNN. "We just need to be better. Google is at 5% because they don't have any users." Ryan compared Google's entry into social gaming to McDonald's recent efforts to offer premium coffee in competition with Starbucks, using low pricing to build market share. It's worth noting that McDonald's coffee business has proved quite lucrative.
At the start of this month, Google+ passed 25 million users. At the beginning of last month, Facebook passed 750 million users.
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