Is Social Gaming a Fad? Or the Future?

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The other day, I watched a hilarious episode of South Park, You Have Zero Friends, about Facebook. Besides having a great time watching the show, it made me think about the social media gaming business.

Personally, I’m not into social gaming and can’t really relate to the idea of spending money to buy a virtual tractor on Farmville. However, the millions of players spending their hard earned money on games like Farmville, Mafia Wars and CafeWorld is something you can’t ignore. Zynga, the maker of the most successful social games, is now valued at over $5 billion.

What’s interesting is that middle-aged women are the primary social gamers. Over 55% of social gamers are women with an average age of 43. Only 6% of the online social gamers are under the age of 21. From all those social media gamers, about a quarter end up spending real money. So it’s not me and my 16-year-old friends that are the primary players. The demographic is very different from the traditional video and online gamer player. While I can’t relate to those games, I am intrigued by the potential business opportunities.

Zynga is making over $100 million a year, purely from gamers who are paying for upgrades within these free social media games. Not long ago, a kid raked over $1,400 of debt on Farmville within two weeks, showing just how addictive these games can be.

I wonder, however, if in a year or two from now whether people will still buy guns on Mafia Wars and virtual seeds on Farmville? And if not, will there be other blockbuster social media games to replace them?

I leave you with this: Is this a brand new industry with a lot of great opportunities for entrepreneurs or is it a phenomenon that will quickly fade out?

Let me know what you think.