Into Zynga Poker? Want a bit o’ artificial intelligence to tweak-up your game play? Then meet your new buddy, PokerBuddy Pro that is.

The PokerBuddy team spent nearly two years perfecting algorithmic and statistical analysis for no-limit Texas-Hold’em. The result is a Windows-only software client that provides players advice, in real-time, throughout their game play. In case you’re wondering, no it’s not limited to Zynga Poker, this is just the first implementation.

Using PokerBuddy Pro is quite simple, all you need to do is keep it open alongside your Zynga Poker window, and just follow its advice. It will keep it coming as it continuously updates its hand-play recommendations based on assessment of hole cards (your hand), the flop cards (top facing cards on the table), the number of cards dealt, and pot size.

How does it gather this data? Good question. All I was able to get out of CEO Alex Frenkel is that evidently it’s not all that difficult to do using deep level of communication protocols.

He went on to say:

You need to understand that this wasn’t the major challenge as there are many ways to integrate, this includes reading the chat, scraping from the screen and more. Legally we don’t see any problem as well because it is not a bot , it won’t play for you!

Here’s where PokerBuddy’s truly compelling features come into play.

The application provides players with two situation indicators:

• Hand Rank – After a player is dealt the first two hole cards, PokerBuddy rates the hand against the overall deck, and provides a percentage indicator of how many possible hands the player’s current cards gives them an advantage over. For example: An Ace of Clubs with a 7 of clubs is statistically better than 88.1% of all other possible hands.

  Once top facing cards are dealt (the “flop”), the Hand Rank lets you know exactly what your highest current hand combinations are (two pair, Flush, etc.).

• Your Stack – This is the number of Big Blinds (potential bets against the current high bid) that you have left so you can plan your betting strategy accordingly.

  After the flop, this indicator switches to let you know how many cards left in the deck can improve your hand, also known as ‘Outs’.

Note: I am more of a cock fighting man, so all this Texas Hold’em lingo had to be explained slowly to me

To make things even easier for players, PokerBuddy deftly integrated game play aggressiveness levels in the form of characters who act as ‘advisors’. These range from the more conservative ‘Edward Bailey’ (The Hold’em Professor), to the mid-road ‘Karen Brown’ (Brown Sugar), to the most aggressive advisor ‘James Ford’ (Young-Gun Ford).

When it’s time to act, the advisers’ backgrounds will change to yellow, allowing the player to click on any one of them in order to get their advice on the current hand in play.

Interestingly, the PokerBuddy team has limited real-time advice at five hands per game. Their logic behind this decision was not to hurt the game or give unfair advantage to any of the players. Also, the team noted that they will gladly adjust this should Zynga ask them to. Post action feedback (after the player made a move) is unlimited because the decision was made and the feedback has no effect on the results of the hand.

There’s one additional part to PokerBuddy Pro and that is its website. The site acts as a sort of social data locker where players can track their results and performance. For players that take their Zynga Poker more seriously, this is a big deal because Zynga Poker doesn’t provide game logs, so the only alternative is to video record a game session.

A social envelope on top of the data allows players to discuss game play with others. All-in-all a great way to learn and improve your game play.

How does PokerBuddy aim to make money? Quite simple really… They plan on selling credits for real-time advice. At the moment advice is free to all, but the company plans on turning on for-pay advice in the coming months.

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With PokerBuddy Pro, You Can Go “All In” With More Confidence

One thing Zynga loves are the “ville” games. Farmville now has 80+ million monthly users, and they’ve go FishVille, YoVille, PetVille, etc. as well as lots of other games. Next up, it looks like, is FrontierVille And as ridiculous as these games are, people love them, sometimes they get addicted to them, and the revenue keeps rolling in.

Next up is FrontierVille, if the screenshots I saw while logged in to Facebook as a Developer Test Account are to be believed.

The game description? Click and then keep clicking. Ok, not really. It’s “Howdy Pardner! Let’s explore a new life on the frontier. You gotta chop trees to construct buildings, clear land to raise livestock, plant crops, and raise a family. The untamed wilderness is hazardous, but your fellow pioneers are there to help.”

Milestones include things like “learned the ropes,” “just broke ground for a new homestead!,” and “just finished building a General Store in FrontierVille.”

I just wish they’d create BloggerVille. I think I’d be really good at that.

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Zynga’s Newest Game: FrontierVille

One of the cofounders of Zynga, the company’s executive vice president of sales and business development Andrew Trader, is no longer with the company, we’ve confirmed. He has been quietly removed from the company’s management page. Remaining cofounders – Mark Pincus, Michael Luxton, Eric Schiermeyer, Justin Waldron and Steve Schoettler, remain.

As of a month ago Trader’s title had been downgraded to VP of Partnerships and Studio Services, although no top sales or business development replacement executive has yet been named.

Why is he gone? No one is saying. CEO Mark Pincus says only “AT [Andrew Trader] and zynga have parted ways. He made an awesome contribution. We need to continue scaling the company.” Trader hasn’t yet returned a phone call asking for his comment.

Zynga’s revenue growth has been nothing short of astronomical over the last 18 months, so it would be hard to blame him for not bringing in the dollars. Perhaps he took the fall for the Scamville saga although that has largely blown over now.

Trader was with Zynga nearly three years, so he’s vested on a lot of his stock. Given how much money is at stake, the whole story about why the first cofounder of Zynga has left the building may never come out. Zynga raised $180 million in December 2009, at a rumored valuation of above $2 billion.

And no, I have no idea why he’s holding a banana in the picture.

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Zynga Cofounder Andrew Trader Out

Zynga investor Fred Wilson remained mostly quiet during the Scamville debacle in October. But he’s starting to talk now, and he isn’t happy.

In a post about Etsy a few days ago a commenter brought up the Zynga/Scamville stuff. Wilson replied “Citing techcrunch on the zynga stuff is a joke.” He waded into the subject again today on another of his posts, saying in a number of comments “i’ve tried hard to stay out of that debate because it is a false debate…zynga makes almost all of its revenue on virtual goods…the “scammy ads” thing is total red herring that everyone got excited about but is almost entirely irrelevant” and “nobody who got involved in that shitstorm took the time to really do the work and look at what Zynga did and did not do. or compare it to Google and everyone else who does way worse on a daily basis…the whole thing totally annoys me. it’s not fair.” He also said numerous times that we didn’t have our facts straight, and that we didn’t take the time to understand what really happened.

Hogwash. Fred Wilson is a brilliant investor, but he’s conflicted and wrong yet again.

There were a total of 22 Scamville posts (see updates) on TechCrunch alone. For the most part we left Zynga alone, until we were slammed in the face with CEO Mark Pincus on video saying “I Did Every Horrible Thing In The Book Just To Get Revenues” (how do you take that statement out of context?). Pincus also said “we need to be more aggressive and have revised our service level agreements with these providers requiring them to filter and police offers” in a post about Scamville. And Facebook took one of their games offline for a few days for a violation of their terms of service around scammy offers.

Zynga had claimed in the past that fully 1/3 of their revenue came from offers. Some of that wasn’t legitimate, likely tens of millions of dollars, and other companies have said that the bad stuff tended to push out the good stuff.

There is an excellent argument that you can continue to find most of these scams on Google and other search engines. But a big difference is the incentive that social games give users to enter into these scams via virtual currency, as well as the fact that they targeted teens without credit cards by pushing mobile subscription offers. Google is wrong to post these ads. But that doesn’t make what Zynga has done right.

I think Pincus took the right steps to move his company in the right direction, and I think the industry is on the right track now, and Zynga looks to be a legitimate business even without scammy offers. I support Pincus as an entrepreneur. But to deny that there was ever a problem is irresponsible. And to suggest that we didn’t take the time to understand the facts is outrageous. In addition to the 22 posts where we spoke to dozens of sources on and off the record, I asked Pincus to go on video with me to tell his side of the story without editing. He declined.

Zynga continues to be a very close partner to Facebook. They share a major investor, DST. A facebook board member, Marc Andreessen, is also an investor in Zynga. And Zynga is Facebook’s largest advertiser. The fates of these two companies are deeply aligned, and there has been more than a little evidence of wrongdoing. The relationship between Zynga and Facebook needs more scrutiny, not less.

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Zynga Investor Calls Scamville Debate Irrelevant And Unfair

Zynga CEO Mark Pincus said earlier this week that he intends to make sure his company’s games don’t include scammy offers in the future. Our full background on this story is here.

But what he didn’t say in that blog post is that Zynga has been scamming users from the beginning quite intentionally as part of their revenue model. Rather, he pointed much of the blame at middlemen offer companies: “We need to be more aggressive and have revised our service level agreements with these providers requiring them to filter and police offers prior to posting on their networks.”

Last spring, though, he gave a much clearer explanation to an audience at a Startup@Berkeley mixer, admitting that scamming users was part of Zynga’s business model from the start. And it was all caught on video. I think everyone sort of knew that this was exactly Zynga’s gameplan. But to hear it said so directly is just shocking.

The full 30ish minute video is here. We’ve taken the relevant section of the video, roughly starting at around the 10:40 mark, and embed it below. From the video:

I knew that i wanted to control my destiny, so I knew I needed revenues, right, fucking, now. Like I needed revenues now. So I funded the company myself but I did every horrible thing in the book to, just to get revenues right away. I mean we gave our users poker chips if they downloaded this zwinky toolbar which was like, I dont know, I downloaded it once and couldn’t get rid of it. *laughs* We did anything possible just to just get revenues so that we could grow and be a real business…So control your destiny. So that was a big lesson, controlling your business. So by the time we raised money we were profitable.

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Zynga CEO Mark Pincus: “I Did Every Horrible Thing In The Book Just…

Zynga changed their lead gen scam policy this morning (the whole Scamville background is here, see updates at bottom as well). And now RockYou is taking steps to clean up their act to, according to an email we’ve been forwarded.

In an email to RockYou’s publishers, they say that they will begin complying with Facebook’s rules on offer scams (and like you, we’re not sure why they haven’t been complying all along, but lax enforcement is likely the cause).

Two interesting nuggets from the email though. First, RockYou says that from now on you’ll only see “clean, safe surveys from top tier brands advertisers.” All of the surveys we’ve seen are mobile subscription scams, so I’m not sure there’s such a thing as a clean, safe survey.

Second, the email says “the Facebook compliance team will be keeping a very close eye on offer walls starting tonight.” We’d heard that Facebook is coming down hard on app developers around scams right now, but Facebook won’t comment about it other than to say that they have always been monitoring application offers and enforcing the rules. From what we’ve seen, that enforcement didn’t bring much in the way of results, but perhaps they’re more serious about the situation now.

The full email:

Subject: RockYou Offers: Facebook Offer Wall Compliance Update

Hi RockYou Publishers,

You may have heard the recent controversy around the types of offers that are being run by most offer wall providers (Offerpal, SuperRewards, etc.). If you haven’t heard, take a look at this post on TechCrunch:
http://www.techcrunch.com/2009/10/31/scamville-the-social-gaming-ecosystem-of-hell/

The Facebook compliance team will be keeping a very close eye on offer walls starting tonight.

Since the RockYou Ad Network is the largest display network on the Facebook platform, we have a long history of working directly with the Facebook compliance team to ensure that we always maintain the highest standards of compliance and ad quality.

We will apply the same level of quality assurance to our RockYou Offers platform.

Some thing to keep in mind that set us apart from the other offer wall providers:
* 100% Facebook compliance starting this evening, and on an ongoing basis
* Clean, safe surveys from top tier brand advertisers
* High quality brand campaigns ranging from video ads to free sample offers
* Cost-per-install campaigns for other Facebook applications

We believe we will continue to outperform the competition based on our diverse advertiser base, and we will do so while always maintaining full compliance with Facebook policy.

Our technology provider for RockYou Offers, PeanutLabs, has also posted an interesting research study they ran over the weekend that clearly outlines how users feel about the scammy offers that have been so prevalent on offer walls:
http://peanutlabs.wordpress.com/2009/11/02/survey-finds-arrington-has-a-point-given-choice-users-overwhelmingly-prefer-direct-payments-and-research-surveys-to-cpa-offers/

We believe the new Facebook policy enforcement is in the best interest of Facebook users and the entire platform ecosystem, and we look forward to working with you as a safe and effective monetization partner.

If you have not yet switched over to RockYou Offers, all you have to do is:
1. Log in to your publisher account at ads.rockyou.com
2. Click on the RockYou Offers tab
3. Follow the 4-step integration process

If you have any questions or issues with integration, please contact Chris or Aaron:

Chris Akhavan
[redacted]

Aaron Choi
[redacted]

Thank you,
RockYou Offers Team

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RockYou Joins The No Scams Parade. But What’s Facebook Up To?

A big part of the debate about the lead gen scams plaguing Facebook and MySpace via social games is over how much money is being made on these “offers.” Zynga, by far the most successful at building and monetizing these games, is now telling us exactly how much – 1/3 of total revenues, according to Andrew Trader, a co-founder of Zynga:

Andrew Trader, co-founder of Zynga, said the company makes about a third of its revenue from advertising and another third from virtual goods transactions. The last third comes from companies that provide commercial offers, trading Netflix memberships and marketing surveys for in-game cash.

Zynga revenue guesses range all over the place, but are likely $250 million a year or more. That means $80+ million/year is being brought in from legitimate offers like Netflix subscriptions, as well as the really smelly stuff like recurring mobile phone and learning CD subscriptions that trick users into paying big dollars for little or no return value.

What percentage of offer revenue is scammy? We believe it varies over time, and is heading in the wrong direction. Legitimate advertisers like Netflix and Blockbuster, hit with countless laundered subscriptions from repeat subscripers, are said to be dramatically lowering bounty fees paid on signup. Far less scrupulous advertisers like Video Professor and Tatto take their place.

HotOrNot cofounder James Hong said it best in a comment to our post yesterday outlining the scams: “In a nutshell, the offers that monetize the best are the ones that scam/trick users. Sure we had netflix ads show up, and clearly those do convert to some degree, but i’m pretty sure most of the money ended up getting our users hooked into auto-recurring SMS subscriptions for horoscopes and stuff.”

Offerpal and others, who provide these offers to game developers, try to downplay the percentage of revenue that comes from scams. Clearly they are obfuscating the truth, to put it kindly.

Facebook and MySpace must takes steps to address this.

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Scamville: Zynga Says 1/3 Of Revenue Comes From Lead Gen And Other…

So much for the first generation of big Facebook/MySpace social application startups. Slide and RockYou both got huge valuations in venture rounds. But a new generation of application developers has taken center stage and are racking up big revenues and their own eye popping valuations: Zynga, Playfish and Playdom.

All three own popular social games on Facebook and MySpace. Zynga’s Farmville has 61 million monthly users. Playfish’s Pet Society has 21 million monthly users on Facebook. And Playdom has 16+ million monthly users of Mobsters on MySpace and Facebook Combined.

All three companies are getting a ton of press and investor attention. Zynga wants to go public next year. Playfish probably already got bought by EA for $400 million or more. And Playdom probably raised an unannounced big chunk of venture capital over the summer.

These three companies may be generating as much as $300 million annually on sales of virtual goods. Need a shotgun to do that next job on Mobsters? No problem. Pay with a credit card, paypal, or your mobile phone and it’s all yours. And people are obviously very willing to buy these virtual goods. Nothing new there.

The goal of all of these games is to get to a higher level, and generally have more fun growing things or killing things faster than your friends. Get addicted to the free version, then start spending to move things along more quickly. Once people are committed, it’s easy to get them to pay. You can read all about it on Business Week.

Except Business Week didn’t mention the dark side of the business at all.

All three companies are willing to give game currency in exchange for offers. Sign up for Netflix. Buy a ringtone subscription. Or energy drinks. Sign up for a credit card. Get car insurance. Take an IQ survey that requires a $9.99/month mobile subscription to see the results. We even found one for arthritis medication. Here’s how it all looks. One executive we spoke with says that 70% of total revenue from these applications may come in from lead generation, not direct payments. Netflix alone will pay $30-$40 for a free trial (requires credit card).

Three companies control most of these lead generation offers: TrialPay (appears to have the most legitimate offers), Offerpal and SuperRewards.

There’s nothing wrong with basing a business off of lead generation, although some of the offers are pretty sketchy (long term credit card or mobile subscriptions for little or not value). And the FTC does tend to take a swipe at them periodically. But the bigger problem is that advertisers may not be getting much for their payouts. As the higher quality advertisers bail, pressure to add the scam artists increases.

The cycle of all of these games is pretty standard. Get new users playing for free, give them incentives to message all their friends to signup, hit them hard for cash or lead generation for revenue, and move them up the levels. Rinse. Repeat.

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Social Games: How The Big Three Make Millions

There’s no love lost between competing social gaming platforms Zynga and Playdom. Earlier this year Zynga sued Playdom over what they called misleading ads. That litigation appears to remain outstanding, but Playdom has since changed their advertising practices.

Now there’s a much more serious dispute between the companies. Yesterday Zynga filed a lawsuit against Playdom and a number of other defendants in California state court. Among the many causes of action: misappropriation of trade secrets, breach of contract, breach of the duty of loyalty, tortious interference with contracts, tortious interference with existing and prospective economic advantage and unfair competition. The defendants include four ex-Zynga, now Playdom employees as well.

What this boils down to: Playdom has allegedly hired away a number of Zynga employees, and those employees have allegedly taken key information and documents from Zynga and have given them to Playdom. Among the most important documents that were supposedly stolen: The Zynga Playbook:

The Zynga Playbook is literally the recipe book that contains Zynga’s “secret sauce,” and its contents would be invaluable to a competitor like Playdom. The Zynga Playbook constitutes a collection in one document of many of the most material non-public commercially valuable concepts, techniques, know-how and best practices for developing successful and distinctive social games. The Playbook is the result of years of testing, development, trial and error, analyzing customer behavior, game behavior, optimizing past successful techniques, and collective know-how that Zynga has spent millions of dollars and more than tens of thousands of man hours developing and devising, and which could only be compiled by developing and deploying successful games over a period of years to millions of them. In the hands of a competitor like Playdom, this document alone creates huge exposure to Zynga as it breaks down in detail and memorializes the company’s key and collective efforts to develop and fit games to the social networking platform in the most successful manner. It is a “how-to” manual that belongs to Zynga.

Zynga accuses Playdom of actively soliciting Zynga employees to turn over proprietary information:

…Playdom recruiter Jennifer Farris emailed Defendant Martha Sapeta, a then-current Zynga employee who owed her undivided loyalty and best efforts to Zynga, with a “small assignment” as part of an upcoming and lengthy recruiting and interview meeting. Playdom instructed Defendant Sapeta to “compare and contrast” the precise Zynga games she was working on to corresponding competing Playdom games. Sapeta was offered “bonus points” if she could “propose a feature in [Playdom's competing] game that [she][thought] whould improve [user] growth.” Playdom even suggested the feature “can be a straight up ripoff from our competitors [i.e., Zynga's] app,” but with the caveat that Sapeta would “still have to explain in detail” how the ripped off features would work in Playdom’s competing game.

Specifically, Zynga accuses an ex-employee of downloading 70 files to a USB storage device two weeks before leaving to join Playdom. Three of the files were proprietary Zynga documents. Another defendant mailed 22 proprietary documents to his personal email account before departing to Playdom. The Zynga Playbook was among them.

The judge granted the request for a temporary restraining order against Playdom and the other defendants. Those defendants are prohibited from destroying any of the files allegedly misappropriated.

Neither company would comment on this story.

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Zynga Accuses Playdom of Stealing Trade Secrets; Judge Issues…