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Facebook Bets on Gambling

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"Bingo & Slots Friendzy" launches in the UK.

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MINYANVILLE ORIGINAL Facebook (FB) has launched a bingo game that uses real money, only for users over age 18, in the UK. The "Bingo & Slots Friendzy" app has 90 slot machine and bingo games that take real money, not Facebook Credits.

The move could be a money maker for the company as Facebook takes 30% of the revenue. UK-based Gamesys, the app developer, will take the other 70% of revenue. Certainly it seems a positive move given all the negative attention the company has recieved.

In true Facebook fashion, activity on the app will appear in users' timelines, but Facebook's age-gating and geo-location technology will restrict those posts from appearing to underage users and those outside the UK.

Zynga (ZNGA), Facebook's gaming partner in the US, is noticeably absent from the UK deal. The two companies were once each other's best source of revenue (tied to in-game transactions of online goods, not profit from the games themselves). However, players for Zynga's games have been steadily decreasing as users move from PCs to mobile devices. It has made its own attempts to enter the mobile gaming market, including purchasing mobile game developer OMGPop.

Facebook users in the US won't have access to its new gambling app as online gaming is illegal in most states. Although Delaware is moving closer to legalized online gambling, as is New Jersey, Facebook would need legislation in all 50 states to bring gambling to its home shores. So far only 20 states have even considered legalizing online gambling.

The most likely regions for expansion of Facebook's gaming venture are Asia and Australia. Although gambling is not legal in most of China, it is in Macau. Australia and Singapore already have legalized gambling.

No positions in stocks mentioned.
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