14 DAY TRIAL // Social gaming is becoming increasingly popular and a big business. The trend became apparent last year, as more and more people played games on social networks and the companies that made them started raking in the money. Social network hi5 saw this as an opportunity to refocus and revamp the site with social gaming in mind. Its latest move solidifies its position, as it has acquired social gaming developer Big Six for its all-star team, but also for the technology it has created so far.
"The Big Six team and technology are a perfect complement to what we have already developed at hi5," Bill Gossman, CEO of hi5, said. "Over the last two years, we have made a substantial investment in building out the industry's most robust commerce infrastructure for virtual goods and gaming and this acquisition will considerably augment both our commerce platform and domain expertise."
Big Six's founders, Kevin Gliner, Monty Kerr and Chad Hansing, will be joining hi5's executive ranks. hi5 says the move will bolster its own gaming and virtual currency platform with an emphasis on "payment processing, fraud detection and conversion optimization." Big Six's existing gaming platform will also be integrated in the social network, joining the growing number of existing games available on hi5. The details of the deal were not disclosed by either of the companies.
The core of hi5's new direction is its virtual currency, hi5 Coins, and the micropayments platform. The social network says users have over 60 methods of paying for hi5 Coins and there is also an ad-based system for acquiring them. The strategy seems to be paying off too, its gaming section now attracts one third of its traffic and the social network makes 15 percent of its revenue from the virtual currency. If this model will pay off in the long run is anyone's guess, but, judging by the popularity of social games and the fact that Facebook seems otherwise untouchable, the move may be as good as any other to provide the site with growth and revenue.