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Comment by pclark | Hacker News Reader

> i've tried hard to stay out of that debate because it is a false debate

> zynga makes almost all of its revenue on virtual goods

> i said in my etsy/san telmo post the other day that more tractors are sold every day in farmville than are sold in the US every year

> that's where the money is in social gaming

> the "scammy ads" thing is total red herring that everyone got excited about but is almost entirely irrelevant

in the comments to that post: http://www.avc.com/a_vc/2010/01/areas-of-interest.html#comme...

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> i said in my etsy/san telmo post the other day that more tractors are sold every day in farmville than are sold in the US every year

The supply of real tractors is limited by a large number of things that cost real money including raw materials, labor, and so on. The supply of virtual tractors is not really limited by anything (marginal cost is pretty much 0), so the cost ought to be 0 or awfully close. Granted, there are costs to 'develop' virtual tractors, but those don't limit the production of them once they've been created.

Virtual tractors in fv only have one supplier. Therefore the pricing will be monopolistic and would not trend to zero.

They ought to be zero were it in any way a sensible market, but it's not. I think people buying that stuff are a bit batty.

> i said in my etsy/san telmo post the other day that more tractors are sold every day in farmville than are sold in the US every year

(1) There are more farmers in farmville than there are in the US. Farming in farmville is all luxury activity, so folks will spend more time on fun activities.

(2) Farmville is a game where tractor buying is part of the game. Farmers buy tractors out of necessity.

Not a fair reply, Zynga today makes >90% of its revenues from virtual goods (and above 80% of that is from Farm-ville) that was not the case when Fred invested when they were makeing >75% of their revenues came from offers.

where do you get this data? it is wrong. nowhere near 80% of zynga's revenues come from farmville. i won't say more than that because it is nobody's business. but it is not even close to 80%.

I apologize http://news.ycombinator.com/item?id=1028422

wow. i appreciate that post you made.

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