This week could prove quite the turning point for browser-based social games, especially where Facebook is concerned. First Electronic Arts said that it is pulling its most popular games from Facebook, raising questions over whether it plans to shut down its Playfish social games subsidiary. Then figures from metrics tracking firm SuperData showed that last month, the social games segment reached a new low of $124 million in total revenue. The social games space is holding back the overall digital space, says the company. But has this week been the final nail in the coffin for the social games space, or has it simply opened up the floor for a host of new developers to try their luck? Facebook, expectedly, reckons it's the latter. "One developer shifting resources or moving a game does not speak to the health of the ecosystem," Facebook's technology communications manager Tera Randall tells me, "the same way a console game maker pulling a game off a store shelf doesn't mean that the store is having problems." She continues, "It's a natural progression that's not unique to social games and one we've always seen as people move from one hit to another, or focus on a new franchise." Stats shared with Gamasutra earlier this week back up Randall's statements to a point, and she says that following EA's cutting back of its support for social games, Facebook is "not at all worried about an exodus." "It's important to note as well that if/when developers invest more in mobile (as we also have with our own apps), the vast majority use Facebook as the cross-platform identity system, as well as one of the primary ways to drive app discovery through News Feed, App Center, and our new mobile app install ads," she adds.

Social devs speak

Talking to the platform holder is all well-and-good, but Facebook was always going to say that everything is hunky dory. The real test is whether social game developers still feel like it's a space worth sticking with. UK-based Playdemic has seen great success with social games in recent months, as its Facebook and Zynga.com game Village Life has around 2 million daily active users. Notably, according to data from AppData, the game has between 100,000 - 500,000 DAUs on Facebook, thus the majority of Village Life's players must be from Zynga.com, as part of Zynga's incentivized cross-promotion efforts. "I think we need to be careful here to distinguish between EA closing game services which they no longer feel are viable, and the overall health of the Facebook games platform," states Paul Gouge, CEO at Playdemic. "An inevitable consequence of the Social Game Service business model is that, at some point, the service will become uneconomic for the publisher," he continues. "This is the point at which the monthly revenues generated simply aren't sufficient to justify the costs associated with running the game." With the games industry embracing the "games as a service" philosophy in recent times, Gouge believes that revenues no longer justifying costs "is going to become a much more frequent occurrence regardless of platform and something that, as an industry, we need to ensure we are able to manage in a way that is the best it can be for our players." It will also become something that gamers actually begin to anticipate with their games, he reasons. "As for the Facebook games platform, whilst there have been significant changes we still see it as a viable and exciting platform for publishing games and if you look at the $2.8 billion in revenue spent in games on Facebook in 2012, players would seem to agree." What Gouge sees isn't a decline in the number of players who are willing to play social games, but rather, an industry that is fickle and prone to changing its mind about what's hot and what's not much too frequently. "What worries me is that as an industry we are good at having huge collective mood swings about platforms, business models and genres," he says. "Only 2-3 years ago Facebook gaming was being hailed as the greatest opportunity in the industry and now the collective conscious seems to be ready to throw it out as a bad idea." "The truth as always is somewhere in the middle," he continues. "Facebook is still an important platform for casual and social games and its power in enabling both discovery and engagement of players on desktop and mobile will be with us for a while yet." Of course, even with all this talk, it's difficult to look past the fact that a number of big companies like Zynga and EA are still pulling away from Facebook. Gouge believes this is down to the nature of Facebook as a platform for multiple outlets and not just games. "Facebook is a constantly changing animal, and as games are not its prime offering some of the changes are good for game makers and some bad," he explains. "As a result this means that those companies hoping to get a share of the $2.8 billion being spent on the platform need to dynamically respond to the changing nature of the platform to succeed." Pretty Simple Games is another studio that is having success on Facebook. Its hidden object game Criminal Case currently has over 4 million DAUs, and the company's head of communication Serge Versille is baffled by EA distancing itself from social games. "EA has some big successes, and it's hard to believe they'd just throw away the millions of DAUs," he notes. "But EA isn't a market leader, and in Europe alone, big studios like King or smaller ones like Social Point or Pretty Simple are showing objectively that there are opportunities for growth and success," he adds. "So as it stands, we're seeing this as an opportunity to entertain casual players who will no longer be able to play EA's games." His experience with the social games space is that tight integration with Facebook's features is the key to success on the platform. Notes Versille, "As our co-founder Bastien Cazenave was quoted a month ago, when he was talking about going from 0 to 3M DAUs in the first 3 months since releasing the game, 'The success of Pretty Simple with Criminal Case shows that Facebook remains the best performing online platform in order to reach such an audience in such a short time." Elsewhere, Serbian game developer Nordeus has one of the most popular games on Facebook, football manager game Top Eleven. CEO Branko Milutinovic notes that these kinds of shutdowns from big publishers aren't uncommon in the social games space, and that's likely to never change. "Online games require servers that cost, and when the game stops being profitable, the company will eventually shut it down," he says. "Other big publishers, not just EA, closed dozen of games in 2012, not to mention previous years." However, Milutinovic admits that he has noticed a recent momentum in the space, with more big titles shutting down on Facebook than usual. "I believe that both the media and the industry are experiencing a bit of a shock that these big publishers with big IPs have failed," he reasons, "and that news is generating quite much buzz in the media right now." From what Milutinovic can tell, it appears to be a problem of monetization, rather than a drop-off of players in the space. "We closely monitor developments with every single publisher in the social gaming sphere, and as far as we are concerned, the biggest problem with publishing companies these days is not knowing your audience and not listening to gamers' requests and needs," he says. "Being the well-known company with the big budget and licences just isn't enough, and we could all witness that in the case of EA FIFA Superstars vs Top Eleven. Superstars has shut down last month and Top Eleven is the number one sports game with over 10 million active players today." As a result, Nordeus isn't concerned about EA's decision to move away from social games, or indeed, about what any of the larger publishers are doing.

Big hitters and mobile transitions

SuperData's report from earlier this week suggested that while the larger companies are dropping away from Facebook, this may leave space for smaller and medium-sized companies to take up the empty space from the departures. However, the larger companies that we talked to didn't appear all too bothered about EA's downsizing. Wooga currently holds a number of the top games on Facebook in terms of MAUs, including Diamond Dash (pictured) and Bubble Island, and the company's founder and CEO Jens Begemann told me that "EA downsizing on the platform is not cause for any concern." "Like any big platform, Facebook.com is extremely competitive," he added. "Probably a big difference between the platform and consoles is that big brands tend to matter less. To be successful you need to create the best games with the best user experience and continually iterate upon that. That's an approach that has helped us grow these games over years." Elsewhere, King CMO Alex Dale noted that his company currently has over 108 million monthly players, while King has found that players who connect with games on both mobile and social platforms are generally the most engaged. Indeed, King currently has three of the top 20 games on Facebook, including Facebook's top game Candy Crush Saga. In total, the company has six games in the top 100 rankings based on MAUs. However, Dale chose not to comment specifically on how he sees EA's move this week affecting the platform. Notably, each of the companies that I talked to also has a mobile games presence -- and each was keen to stress that it has no plans to abandon social games in favor of mobile, as many industry people believe is currently the case. Playdemic, for example, says that Facebook games can aid companies in discovery and engagement of mobile titles, while Nordeus says it has always been about cross-platform games, hence a focus on both Facebook and mobile will remain - at least for the foreseeable future. Despite the fact that Wooga holds a number of the biggest games on Facebook, it is a mobile first company with its focus firmly set on iOS. However, the studio does have a number of Facebook games planned for later this year that it hasn't yet revealed, and it says that Facebook will continue to play a big role in its future releases. And Pretty Simple Games sees the two platforms going hand-in-hand, especially considering Facebook's latest mobile games features such as the games feed on iOS. The developer is currently adapting Criminal Case for tablets, with Facebook integration in mind. Social games revenue may be way down compared to at its peak a few years ago, but there are still plenty of developers who believe that there's room to not just survive, but prosper in the space. No doubt the remainder of 2013 will show us exactly where social games are headed.