Thursday, December 6, 2012

Zynga Inc (NASDAQ:ZNGA) applies for gambling license in Nevada

Games developer Zynga Inc (NASDAQ:ZNGA) had said earlier that it was foraying into the area of money-gambling games as a way of seeking alternative revenue streams.

On Wednesday the company announced that it had filed an application with the authority of the state of Nevada to commence real-money gambling games. This is a significant move for the company and has the potential to get the faltering company back on track.

The Nevada Gaming Control Board, to whom the preliminary application has been made, will now take a call on whether the company should be issued the license to run such games and allow gamblers in the state to bet real money on the San Francisco-based company's popular games like Zynga Poker.

At present Zynga Poker is played with virtual chips and does not involve any monetary transactions.

Zynga, which at one time used to mint money from social network games such as Farmville (on Facebook) has been seeing a slide in revenues. The company is looking at gambling as a way to plug the gap.

"We anticipate that the process will take approximately 12 to 18 months to complete," Zynga Chief Revenue Officer Barry Cottle said in a statement.

"As we've said previously, the broader U.S. market is an opportunity that's further out on the horizon based on legislative developments, but we are preparing for a regulated market."

Not all states in the United States have legalised gambling and it could take some years before widespread approval is given in the country.

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