Facebook Drops Credits, Adds In-App Subscriptions

Facebook this week announced plans to ditch its Credits platform in favor of local currencies and allow app developers to offer in-app subscriptions.

Starting in July, users can sign up for recurring subscriptions in addition to one-time, in-app purchases on all Facebook.com and mobile Web apps, Facebook said in a blog post.

"With subscriptions, you can establish a recurring revenue stream and offer updated content or premium experiences for a monthly fee," wrote Facebook's Prashant Fuloria.

Subscriptions are already being tested by developers like Kixeye and Zynga, Facebook said. Kixeye's Backyard Monsters, for example, will start testing an offer of exclusive items for $9.95 per month.

Google to Google Play last month. Apple a subscription billing platform for the App Store in Feb. 2011.

Meanwhile, Facebook plans to say farewell to Credits, which let users buy virtual goods via online tokens. Pricing started at $5 for 50 Credits and went up to $200 for 2,360 Credits.

Since the launch of Credits in 2009, "most games on Facebook have implemented their own virtual currencies, reducing the need for a platform-wide virtual currency," Fuloria wrote. "As a result, we are updating our payments product to support pricing in local currency (ex: US dollar, British pound and Japanese yen) instead of Credits."

Switching to local currency will "simplify the purchase experience," he said, and allow Facebook to reach a global audience.

"With local pricing, you will be able to set more granular and consistent prices for non-US users and price the same item differently on a market-by-market basis," Fuloria said.

Facebook said the transition to local currency will be "seamless" for current Facebook users. "Already, most people see items priced in their local currency in the payments flow," Fuloria wrote.

Remaining Credits and gift card balances will be converted to local currency, which can be spent on in-app purchases.

Facebook will release local currency support for in-app purchases in the next few months, and any apps or games that sells virtual items must switch to the local currency format by year's end. More details are available on Facebook's FAQ.