Google & Zynga Hooking Up for Gaming Network

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gamer11.jpgADOTAS – Visions of “Google Me,” the much whispered- and tweeted-about answer to Facebook, got a bit more colorful over the weekend as anonymous sources spread the word that Google and Zynga were teaming up to launch “Google Games.”

TechCrunch’s Michael Arrington did some old-fashioned muckracking and discovered that Google has quietly invested $100 to $200 million into Zynga, social gaming’s kingpin and the makers of FarmVille and Mafia Wars. Unnamed sources, always my favorite, told Arrington and VentureBeat that Google made the investment, not its venture wing.

“Zynga will be the cornerstone of a new Google Games to launch later this year, say multiple sources,” Arrington wrote. “Not only will Zynga’s games give Google Games a solid base of social games to build on, but it will also give Google the beginning of a true social graph as users log into Google to play the games.”

Buoying this idea is Google’s new hire Mark Deloura, a games evangelist, and a classified for a Product Management Lead on Google’s site.

You don’t have to be a soothsayer to predict that Google Games will be an integral part of Google Me, upping its ante in being a Facebook contender.

Virtual goods and free-to-pay trade-ups would also make a killing for online payment processing service Google Checkout. PayPal, which recorded $500 million in virtual goods payments last year, announced back in March that Zynga was its second largest merchant behind parent eBay.

Earlier this year, the tech media was a-flutter with rumors that Zynga would depart Facebook and launch its own gaming site, but in May the two companies agreed on a five-year strategic relationship that cemented Zynga’s spot on Facebook and expanded use of Facebook Credits in the company’s games. Zynga is projecting $1 billion in revenue in 2011.

If they become direct competitors, can Zynga feasibly maintain intimate relationships with both Google and Facebook?

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