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Facebook reassures Credits developers, gets patent on news feed

February 26, 2010 |  7:57 am

Just a week after Facebook announced that it is partnering with PayPal to make it easier for users to buy Facebook Credits, the site's currency used to buy virtual goods, it now plans to double-down on the technology.Fb logo

According to Facebook, there are now over 500,000 applications available to its users. Facebook Credits, which was put into testing in May, is becoming increasingly important to both Facebook and developers.

The company reported that its "early testing has shown that users paying with Facebook Credits are significantly more likely to complete a purchase that the average Facebook user" who pays with standard currency.

Realizing that, Facebook has decided that Credits, even though it's in its infancy, is worth committing to. The company plans to make it easier for developers to integrate Credits into their applications. It also plans to invest in research to "improve the program and increase conversion and net revenue for developers."

For its efforts, Facebook wants a portion of Credits revenue. The company will collect 30% of Credits spent by users on its site. The remaining 70% will go to developers.

Facebook's decision to take 30% from developer revenue is nothing new. When Apple announced its App Store for the iPhone and iPod touch, it also said that it would take 30% of all application revenue.

News feed patent

As Facebook focuses on increasing its Credits adoption, the company has also secured a patent on its news feed, which displays the actions of a user's friends. It lists when they have commented on a photo, includes images that they have uploaded to the site, and much more.

According to the filing, Facebook's patent includes "a method for displaying a news feed in a social network environment."

The patent describes displaying "news items regarding activities associated with a user of a social network environment and attaching an informational link associated with at least one of the activities, to at least one of the news items, as well as limiting access to the news items to a predetermined set of viewers and assigning an order to the news items."

Some have speculated that the patent will affect other social networking sites, like Twitter.

But further inspection of Facebook's patent reveals no mention of status updates or anything closely related to Twitter. The patent explicitly describes Facebook's news feed, which is nothing like Twitter's timeline, and focuses on how information from the news feed is displayed and distributed to friends.

For its part, Facebook said that it's "pleased with being awarded the patent," but wouldn't comment on how it might affect other social networks that use a similar method for displaying items.

-- Don Reisinger

twitter.com/donreisinger

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