July 01--For a social gaming giant, Zynga's expansion into Austin has been fairly
It's almost as if the developer famous for hits like "FarmVille" isn't even here, quietly occupying the seventh floor of a nondescript building downtown.
But Zynga's local presence has grown steadily, to include not only the downtown office but a quality assurance office in North Austin as well.
In all, Austin has become the company's largest satellite branch in the United States, with about 215 people locally and plans to add 20 more by the end of the year.
Company officials acknowledged that Zynga has flown below the radar here, but that hasn't been intentional, said Mark Skaggs, senior vice president of product development.
"We were just focused on games," Skaggs said. "We were just focused on making it."
One of those products, the latest in the company's popular "Ville" series, was developed in Austin. Titled "The Ville," the virtual house-building game was released last week on Facebook along with a slot machine game also developed locally.
Zynga first came to Austin two years ago when it acquired Challenge Games in 2010. From there, the company slowly expanded in Challenge's old digs, knocking out walls and gradually adding more and more space.
"When I first came, we pretty much stopped at these pillars here, and so we've expanded twice in the last year to fill out the rest of the floor," Glen Steinberg, the company's human resources director, said during a tour to show off the offices.
Steinberg, who moved to Austin last year, said that like a lot of gaming companies that set up development outposts in Austin, Zynga came to town because of talent.
"I've been in the gaming industry for 14, 15 years now, and Austin is forever home of awesome gaming talent," he said. "And I think that translates really well to the social gaming space."
Many of Zynga's employees, Skaggs included, come from traditional big-name publishers such as Electronic Arts.
But compared with traditional console or PC gaming, social gaming has a new set of rules, Skaggs said. For instance, gamers on Facebook tend to be much more collaborative, compared with the other platforms.
"And the way I describe it to (new hires) ... is look, when you come into this business ... we're bringing you to our company because you have a lot of experience making games," he said. "But what you have to do is, you've got to learn a new language and how things actually work here, because a lot of the traditional things don't work. ... The audience is different, so you have to really change your thinking."
It's also different because users can play Zynga's games for free (the company makes money through advertising or in-game microstransactions).
"You don't have to spend any money," Skaggs said. "So our job as game makers is that we have to entice and give the gift of great gameplay to people before they spend money."
These are a transitional times for Zynga.
Last week the company unveiled a network designed to provide the more than 290 million players of its games with the same tools, whether they are competing on Facebook's online social network, a mobile device or the company's own website.
The network is called Zynga With Friends. That's a reference to one of Zynga's most popular games, the Scrabble-inspired "Words With Friends."
Zynga also previewed several new games, including a food-themed title called "ChefVille" as well as its Austin-developed offerings.
The addictive allure of Zynga's free games helped establish the company as one of past decade's brightest Internet stars. Zynga has more than 290 million users worldwide and is expected to generate $1.4 billion in revenue this year.
But some investors appear to be worried Zynga is running out of new ideas as it girds for fiercer competition.
The company's stock closed at $5.44 on Friday, well below the company's initial public offering price of $10 six months ago. The IPO raised $1 billion, enabling Zynga to buy its San Francisco headquarters for $234 million earlier this year to accommodate the growth envisioned by CEO Mark Pincus.
The concerns dogging Zynga include its ability to keep churning out popular games, increasing competition from more experienced entertainment companies such as Walt Disney Co. and Electronic Arts Inc. and a shift toward playing games on smartphones that is expected to fragment that industry.
Still, Michael Pachter, a research analyst with Wedbush Morgan Securities, says he sees a "bright future" for the company.
"The Ville looks similar to The Sims Social, and should do very well," he wrote in an email. "Their zFriends and Zynga.com platforms are smart, (and) make their games more accessible and engaging."
Austin will be a big part of the company's plans going forward, Skaggs said.
"You think about it, we bought Challenge Games, and we established this, and we're growing it," he said. "Some of our other studios, we established (them), and there's a team, and we'll grow them kind of naturally as we need it, but this is here because the talent base and the desire."
Additional material from The Associated Press.
(c)2012 Austin American-Statesman, Texas
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