Google Me Will Use Games as a Weapon Against Facebook

Google is spoiling for a fight with Facebook over the fast-growing market for online games, part of the search engine giant's latest attempt to build a social networking business.

The move would pit two of Silicon Valley's most powerful companies against each other.

Google is believed to have opened talks with several of the games developers that have come to prominence on Facebook, where millions of users play simple social games such as FarmVille and Mafia Wars.

Eric Schmidt, Google's chief executive, yesterday stoked talk about a push in social networking by promising that any Google service would be different from Facebook: "The world doesn't need a copy of the same thing."

Google gets $28bn (£18bn) a year in revenues from selling advertising alongside search results, but faces questions about whether and how to diversify. Internet users are spending more time in social networking sites, and linking to outside web pages from there, potentially cutting Google searches out of the equation.

Facebook, which is privately owned, celebrated the sign-up of its 500 millionth user this month. Its revenues have grown substantially, in part because it takes a 30 per cent cut of any sales generated by the games users play on its site.

And games developers have become some of the hottest properties in the technology industry, thanks to the popularity of so-called "social games" which can be played between members of social networks.

Google has already made an investment in Zynga, which makes FarmVille, whose 60 million users run their own virtual farms, and is also reportedly in talks about partnership deals with other developers, including Playfish and Playdom. Disney agreed this week to pay up to $763m to acquire Playdom, the maker of Sorority Life, in which users can pay to dress up their avatar and take her to online parties.

Google hopes to lure games developers to build its new social networking platform, which Silicon Valley rumours suggest will be called Google Me.

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