Facebook aims for revenues with e-commerce credits

Mon Jun 1 2009, 08:39 AM UTC+01:00

Facebook is quietly trialling an on-site payment platform that lets users buy credits in order to make purchases on Facebook. The trial comes days after Facebook announced updated terms for on-site payments and confirms long-running rumours about the social network's launch of a virtual payment platform.

The system is currently trialling with three third-party applications, in addition to the Facebook Gift Shop. These are illustrated card game app PackRat and virtual greetings card apps Birthday Calendar and Group Card.

Facebook users could previously use site vouchers to buy virtual gifts through the Facebook Gift Shop. By rolling out the platform to other apps, the network may eventually establish a comprehensive site-wide currency that could also extend to Facebook Connect partner sites. If this payment platform gains widespread uptake among Facebook's 200m users, it could provide a lucrative business model for Facebook, which could charge fixed-rate transaction fees.

On the GroupCard app, users can now select a 'Pay with Facebook' tab, which will take users to a screen where they can buy site credits using a credit or debit card. Critics say the system may prove unpopular in the short term, as users can opt to pay directly with their credit card rather than with credits. However, with wider uptake, Facebook is hoping that users will be tempted to buy credits in bulk to make one-click purchases simpler.

It costs USD1 for 10 credits. Previously, Facebook sold 100 credits for USD1. Facebook says the new pricing will make transactions simpler, and has adjusted users' existing credits accordingly.

The trial follows an adjustment to Facebook's payment terms outlining how transactions would be dealt with in the future. At the time, numerous commentators predicted that the change would precede the roll-out of a unified payment platform. Facebook product manager, Joe Sullivan, hinted at the roll-out in an official blog post: "You also may see credits appear in other ways on the site."

The credits trial follows rumours last month that Facebook was preparing to introduce a PayPal-style system that will use real currency for use on virtual gifts as well as real products. This followed speculation stretching as far back as December 2007, when developers were said to first be submitting apps for consideration as part of a new virtual payments scheme.

RELATED ARTICLES

RELATED WEBLINKS