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Zynga wins in copyright suit against Mattel over Scramble with Friends
Zynga has emerged victorious from a round of battle in the High Court after Mattel claimed Zynga's Scramble With Friends app infringed on the toy maker's trademark for Scrabble. Mattel argued that the app's name was too similar to their classic boardgame, Scrabble, which is known as one of the best ways to turn the action of forming of words into a passive-aggressive, violent affair. Although the judge ruled in favor of Zynga concerning the name dispute, he did side with Mattel concerning the app's logo, stating that it "gives the impression that the word is Scrabble when one looks at it quickly." Mattel spokesperson Alan Hilowitz said the company is "disappointed that the court did not rule that Zynga should cease using the Scramble name, which Mattel intends to appeal." The ruling follows the departure of several Zynga executives, including co-founder Justin Waldron. The company also recently shut down four of its games and the website for Draw Something creator OMGPOP.
New Zynga titles struggle, analysts call for increase in daily active users
Zynga's two latest games, Hidden Chronicles and the iOS-only Scramble With Friends, have failed to accumulate the same daily active user (DAU) totals as two of the social giant's previous releases, Castleville or Empires and Allies. This spells big trouble for the company's trading value and future growth, at least according to a report released by financial analysis group Cowen and Company. Hidden Chronicles' 12 day post-launch DAU total of 710,000 is well below the over 5 million DAU figure reached by Empires and Allies and Castleville during their first 12 days of existence; similarly, Scramble With Friends has failed to penetrate the Top 20 barrier on the App Store. Historically, Zynga's DAU totals peak 3 months after a game has been released (according to the report), and while it's possible that both Hidden Chronicles and Scramble With Friends could slowly acquire a larger user base, there's nothing in Zynga's statistical history to make that extremely plausible. Now, 710,000 daily users sounds like a ton of people, but Zynga has set the bar so high that it's not enough to keep the company's overall growth even: "The quarterly rate of DAU decline for Zynga's titles that are at least three months old has averaged 18.4 percent per quarter for the last two years," explained Doug Creutz of Cowen and Company. "Assuming Zynga averages a 20 percent quarterly rate of decline for titles beyond their launch windows in 2012, the company must add 9-10 million DAUs per quarter from new games just to keep total DAUs constant." So basically, any game Zynga releases in 2012 has to achieve at least 5 million daily users in order for the company's user base to break even. In other news, Zynga has constructed a super-sonic ultra-high-altitude aircraft to recover the bar it's accidentally set for itself in the exosphere.
