Facebook places ads on Zynga. Could an online ad network be next? - Los Angeles Times

Facebook is showing ads on Zynga's website, a move that could mean it's preparing to launch an online advertising network.

An online advertising network that stretches beyond Facebook could deliver the revenue boost investors are looking for.

Asked whether Facebook would begin showing ads elsewhere on the Web, Facebook spokeswoman Annie Ta said, "We are only showing ads on Zynga right now."

Zynga, which became a major game player by launching popular games such as FarmVille on Facebook, said in its IPO filing last July that it might show Facebook ads on its site, and that the two would share revenue.

A Zynga spokeswoman declined to comment.

A person familiar with the situation who was not authorized to speak about it publicly said that Zynga is testing the Facebook ads as another possible source of revenue for its gaming business.

It's the first time Facebook has distributed ads beyond its own website. Facebook has been under pressure since its disappointing stock-market debut last month.

People who play online games at Zynga.com log in with their Facebook accounts, so ads will be targeted to them based on information they share with Facebook. Ta said advertisers will not have any additional information to target Zynga players.

"People may now see ads and sponsored stories from Facebook on Zynga.com," Ta said. "We don't share any information about people or advertisers with Zynga, and advertisers do not have any new targeting criteria."

The long-awaited move by Facebook targets an area that Google has found to be a major moneymaker for years. Facebook made most of its $3.7 billion in revenue last year from ads that appeared on its site. On Friday, Facebook shares rose $1.21, or 3.8%, to $33.05.

Greg Sterling, senior analyst at Opus Research, said the success of a Facebook ad network would depend on broadly it is adopted. "Publishers will embrace it quickly if it works," Sterling said.

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