Social Games Player Zynga Is #2 on PayPal

The fact that eBay is PayPal's largest merchant isn't exactly surprising. The auction market is huge, and it's also the online payment company's parent. Yet, the word out of the 2010 Media Summit in New York last week is that Zynga, the social media games company, is the second largest merchant for the payment environment. Social games are growing rapidly, bolstered in large part by the rise of Facebook, which now boasts around 400 million users.

As social media companies realize they need to move to the next level -- from adoption to revenue -- the virtual goods market has emerged as a substantial revenue stream, and Zynga's environment appears to have been designed to capitalize on it. According to an estimate by Citigroup analyst Mark Mahaney, PayPal took care o$500 million in virtual goods payments last year.

Nonetheless, this is small change for PayPal, which processes more than $60 billion in payments a year. Much of it comes from the parent, though hundreds of thousands of smaller merchants around the marketplace. InsideFacebook notes that the rapid ascent of Zynga isn't surprising, given that PayPal's client base consists mostly of smaller participants.

About Zynga
Zynga Game Network Inc. was founded in July 2007 with the vision of connecting the world through games. Since then we’ve dedicated ourselves to making fun and social games for people to play with their friends and have become the largest developer of social games on the web in the process. Zynga games provide a platform for players to express themselves and form deep social connections with their friends.