SAN FRANCISCO-- A new report released today by research firm Inside Network concludes that the total US market size for virtual goods will reach $1.6 billion in 2010, with social gaming contributing $835 million of that total. The report, "Inside Virtual Goods: The Future of Social Gaming" is the latest in-depth study in the Inside Virtual Goods series, co-authored by Justin Smith and Charles Hudson.

"2009 was the year that casual games like Zynga's popular FarmVille took over the major social platforms and changed the way millions of people socialized with friends online. Casual games introduced a rich, new way of interacting with friends on social networks, and saw the highest engagement numbers that the online entertainment industry has ever witnessed," Justin Smith, founder of Inside Network's InsideFacebook.com and InsideSocialGames.com, says.

"With tens of millions of returning users, and millions of new visitors daily, it is no wonder that the social gaming industry saw significant M&A activity: an up-to-$400 million acquisition of Playfish by Electronic Arts, and hundreds of millions of dollars in additional venture investments. Social games are now impacting businesses across the media landscape," adds Charles Hudson, VP of Business Development at Serious Business, and host of the annual Virtual Goods Summit.

The second research report in the Inside Virtual Goods series, "Inside Virtual Goods: The Future of Social Gaming 2010" concludes that social games will alone make up half of all virtual goods revenue in the United States this year.

With research based on interviews with top executives and entrepreneurs in social gaming and virtual goods, Smith and Hudson indicate that the 2010 virtual goods industry will be bigger than previously predicted, and that social gaming will make up the largest and fastest growing portion of the total market.

It's become clear that there are substantial opportunities for social game developers with virtual goods revenue models, but the market is still evolving rapidly and opening new doors on a regular basis. "This type of rapid change and growth is exactly what we sought to cover and analyze in The Future of Social Gaming," says Smith.

"Inside Virtual Goods: The Future of Social Gaming 2010" takes an inside look at the present state of social games and the future of what's shaping up to be a very fundamentally strong and profitable industry.

The report is focused on the following areas:

1. Emerging Social Game Development and Studio Models - How do small, medium, and large developers organize their teams, and how does this affect development cycles and growth?

2. Social Game Design and Mechanics - The emergence of a few key game genres with proven mechanics and monetization have spawned dozens of fast followers. How are some publishers continuing to innovate?

3. Monetization Data and Payment Trends – Now that developers have proven the virtual goods model, how does monetization break down by key game genres, demographics and monetization methods, and what's likely to change?

4. Facebook's Platform Changes, Credits, and What's In Store for the Future - In late 2009, Facebook announced major adjustments that will dramatically alter how social games reach users.How will continued change impact the industry? As Facebook rolls out its much-discussed Credits currency, how will monetization be affected? Will another dominant platform emerge?

In 2009, social games began to show that immense value can be created on top of social networks. According to Inside Virtual Goods, 2010 will be an even more important year as social gaming, powered by virtual goods, becomes this year's industry to watch.

For more details and to purchase the report, please visit: http://www.insidevirtualgoods.com
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