Did you know Amazon powers up to 80% of social games?
When it comes to the new market of "social games," a few names always pop out - Zynga, Facebook, Farmville, EA's Playfish... but actually, one of the most important players is Amazon.
Yes, Amazon - the same place that most people associate with cheap books and electronics. The online retailer has its own division responsible for providing cloud computing Web Services, and a lot of big names have come on board - names like Netflix, The New York Times, Nasdaq, and even NASA.
Venture Beat has an interesting look at how Amazon has become an unexpectedly important name in social games, and thus in the video game medium as a whole. Amazon's Web evangelist Jeff Barr says that at any given moment, around six to eight of the top 10 Facebook games are being hosted through its online services.
The video game industry is rapidly changing its climate away from one where just a few big players rake in huge amounts of money to one where those same big players are now sharing their profits with hundreds of independent developers, none of whom are exactly getting rich either.
In this kind of market, it seems like a player like Amazon stands the most to gain, as it can touch the entire industry. And Amazon is a familiar name, so a new developer can get into the service without much intimidation.
Amazon Web Services is expected to blossom to a $2.5 billion industry by 2014, and a lot of that will probably be attributed to social games, because that's just about the most dynamic market out there.
By putting its hand in the entire industry's cookie jar, it stands to gain a lot of ground and it keeps itself very insulated from failure. It's a brand new shift for the industry. In previous generations, there certainly weren't a lot of opportunities for any company to be a middleman to just about everyone.
How Amazon was able to attract so many social game developers is unknown, especially because it doesn't advertise its hosting services that substantially, but it has obviously planted its roots in social games, and it should pay off in droves.