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Europe has played a key role in the evolution of virtual goods outside of Asia. Habbo Hotel, created by Finish developer Sulake, was one of the first proof points that virtual goods could work on a mass scale outside of Asia. Today, Habbo Hotel gets about 15 million visitors a month and generated $60 million in revenue in 2009, primarily from virtual goods.
In addition to virtual worlds, Europe has played a key role in the development of the social game market and many view European social networks as a key front in the expansion of social gaming outside of Facebook. In a recent interview with Lloyd Melnick on Social Games Observer, Playdom’s General Manager of International Operations discussed how the company views European social networks, such as Germany’s StudiVZ and Poland’s Nasza Klasa, as a key part of its expansion. Melnick cites the fact that strong monetization on Orkut, Google’s social network which has a heavily international audience, is an indicator that international users monetize as well as if not better than U.S. users.
Leaders in the virtual goods, social media, and social gaming industry will gather at the Virtual Goods World Europe 2010 conference in London. The conference will last three days from November 15 to 17 and will feature CEO-level speakers in the industry including Timo Soininen, CEO of Sulake, Mari Baker, CEO of Playfirst, and John Earner, General Manager of Playfish EMEA. The conference will focus on the opportunities and challenges presented by the explosive growth in virtual goods, and will cover a range of topics to help social networks, game developers, and brands turn this growth into a reliable revenue stream.
Social games have transformed Facebook from an advertising-oriented business to a virtual goods powerhouse. Today, the majority of social game revenue is generated on Facebook, but Facebook makes up only about 30% of social networking traffic. The next wave of growth in social games will come from beyond Facebook, and social games will change the way we think about the social networking business. My guest post on Mashable, Why Games Are the Killer App for Social Networks, discusses how social networks can take advantage of this explosive opportunity.