With the rise of so-called “crowdfunding,” game makers are finding fans online who are willing to pledge a few bucks toward a game they’d like to see produced.

The primary site where these connections are being made is Kickstarter, a three-year old company. Since Kickstarter got off the ground, the games category has garnered $29 million in pledges, according to the New York Times. Other popular categories include film/video, music and design.

Further, it was reported that 854 game developers successfully reached their fundraising goals, raising an average of $29,409 apiece.

Most impressively, three game companies have raised more than $1.5 million each since the beginning of this year: Double Fine raised $3.3 million from 87,000 backers; Wasteland 2 raised $2.9 million; and Shadowrun Returns secured $1.8 million.

Another site, Gambitious, which will be exclusively dedicated to helping game companies raise money, is preparing to launch on June 5 in Los Angeles as part of E3, the industry’s big annual conference.

The shift to nontraditional fundraising is now even catching the eye of megapublishers like Electronic Arts. Last week, EA said developers who crowdsourced funding will be able to sell their games on Origin at no cost for three months.

Origin is the company’s online game store, which allows users to download PC games electronically and counts up to 12 million users worldwide.

“The public support for crowdfunding creative game ideas coming from small developers today is nothing short of phenomenal,” said David DeMartini, EA’s SVP of Origin, in a release. “It’s also incredibly healthy for the gaming industry. Gamers around the world deserve a chance to play every great new game.”

EA doesn’t disclose how much it charges because it says fees can vary, but through this program, developers will now receive 100 percent of sales during the 90-day window plus any pre-sales that are generated before the title officially launches, a spokesman confirmed.

It’s unclear whether crowdfunding is a fad and consumers will tire of it quickly, and to be clear, not every company that requests money is able to get it.

But it pairs nicely with a broader trend in the industry that AllThingsD’s Eric Johnson wrote about last week. He explained that game developers are increasingly finding it advantageous to stay small, rejecting the notion that productions need big budgets in order to create blockbusters.

The evolution has been aided by the rise of three new distribution platforms, Apple’s App Store, Facebook and Valve’s Steam Store (and to a lesser extent, EA’s Origin, which is catching up). With these digital platforms, developers can reach customers without having to package up their software and sell it at retail, saving thousands of dollars.

With the crowdfunding phenomenon completely under way, Videogame Analyst and Consultant Scott Steinberg saw the opportunity to write an e-book on the subject called “Crowdfunding Your Business: A How-To Guide.” In the recently released book, he argues that crowdfunding helps developers identify projects that consumers are willing to pay for, before they’ve wasted the money and time on developing them.

He writes that by “requesting feedback or recruiting help from public donors via open calls for assistance — you can gauge demand for and create bankable products from day one.”

Recently, Funzio sold to Japan’s Gree for $210 million, and Zynga acquired OMGPOP for $180 million; not too long before that, Electronic Arts paid $750 million for PopCap.

In an interview, Pocket Gem’s COO Ben Liu said that mobile game companies are hot commodities right now, but to sell is shortsighted.

“We feel like it’s the early days of mobile,” Liu said. “There’s a decade-long shift occurring from PC and the Web to mobile, and games is only the first vertical to take off. There’s so much opportunity. We need all of our attention on that to be successful.”

Liu would not disclose the company’s revenue, but said that it has been growing extremely fast. Over the past year and a half, the company has moved its offices five times to accommodate the growth of its staff — from 10 to 120 employees.

And as of a few months ago, the company recorded 60 million app downloads since its founding in 2009. Its hit title Tap Zoo generated 20 million downloads alone.

Pocket Gems’ games fall into the “casual” genre, and are focused on building products that have fairly addicting play; they attract a predominantly adult female audience. The games normally have “tap” in the name — Tap Zoo, Tap Pet Hotel and Tap Jungle allow players to build, respectively, their own zoo, pet hotel and mystical rain forest.

Last week, Pocket Gems released its first game exclusively for Android, called Tap Dragon Park, which allows players to train dragons to defend their kingdoms.

Pocket Gems has been able to rise in the rankings without having to tap investors too much. (Maybe their next game will be Tap Bank?) It has raised $5 million in capital from Sequoia Capital and a handful of angel investors, and is profitable.

Here are Liu’s thoughts on some of the issues facing the mobile games industry.

On making acquisitions versus being acquired:

Liu says Pocket Gems isn’t entertaining offers at this time, but will consider making acquisitions of its own. “We’ve been completely focused on organic expansion, but I think as we continue to grow, something we’ll look at is acquisitions, as well. We are focused on building a great team organically, and are opportunistic.”

How many games can you release in a year?

“Last year, we launched 10 games total. Some of them are new IP that requires a larger team and can be franchise-sustaining, and others are seasonal titles or extensions.”

Is there an issue with copycats in the space?

“Yes, all of our games have been cloned extensively by most of our competitors. But that’s one of the prices of success. We’ve always prided ourselves on being an innovator. The thing that is difficult to clone is creativity. … We have a saying: Pocket Gems is a leader and not a follower. And many of our competitors have a fast-follower strategy.”

What are your thoughts about third-party distribution platforms, like Gree and DeNA, which are trying to create mobile social networks?

“We haven’t opened our games to third parties. It’s in our interest to develop our own platform. Their businesses are really compelling, but there’s no winning platform yet in the mobile space. We have our own loyal community, which is a powerful game engine. We don’t want to be dependent on someone else’s platform. Our own great platform is a powerful source of marketing, and it is good at letting our users know about the games. That’s the most effective.”

Is summer a good time for people to play and discover new mobile games?

“It’s a good time. People are on vacation and in transit, and it’s a natural device to use during those times. And people have more downtime and free time. We’ve found historically for it to be good. Holidays are another.”

Typically at this point in the hardware cycle, he said, the cost of developing new videogames would lead to a loss. But in a conference call with investors yesterday, Riccitiello said revenue from digital content will keep EA profitable.

“In the face of, unfortunately, somewhat of a headwind relative to console, we’re getting top line growth, robust digital growth, robust margin expansion, robust EPS growth, while affording the investment in the next-gen console. I don’t think, going back to our foundation in ’82, that’s ever happened before. So what we are guiding for is entirely unprecedented, and it’s a function of everything we’ve been saying on the call so far. … It’s our hope to be able to accelerate top line through a transition and accelerate bottom line growth through a transition because we won’t be facing sort of negative console compares.”

Nintendo expects to release the Wii U later this year, which will require new games that tap into both the TV and a touchscreen device. Neither Microsoft or Sony have unveiled plans for their respective next-generation hardware systems, the Xbox and PlayStation. Riccitiello did not mention the new consoles by name, and instead referred any direct questions about hardware to Sony, Microsoft and Nintendo.

“We intend to invest $80 million in Gen4 console development in fiscal ’13. We are strong believers that console will return to strong growth, and represent a great opportunity — one that is in lockstep with our digital plans.”

In fiscal 2012, EA generated $1.2 billion in digital revenues, representing a 47 percent increase year over year. In the past six months alone, FIFA 12 — one of the company’s traditional packaged good titles — was able to break $100 million in digital revenues for the first time. This year, it’s predicting digital revenues of $1.7 billion, representing 40 percent of the company’s overall business.

Even though Riccitiello painted a positive outlook, he failed to turn to the tide.

Along with a broader market meltdown, the company’s stock fell 65 cents, or 4.3 percent, at $14.48 a share. At that price, the company’s stock is off more than 40 percent from its 52-week high of $26.13 a share.

During the call, Riccitiello also tried to stress that while Star Wars: The Old Republic is an important title for the company, it is getting an unfair amount of attention by analysts. In the quarter, he said the number of subscribers fell to 1.3 million from 1.7 million when the game launched.

“So while I understand there’s an enormous amount of interest, I don’t know that it warrants as much as what we’re seeing right now,” he said, according to a SeekingAlpha transcript.

The final highlight from the call was when Riccitiello questioned how much Zynga paid for OMGPOP and its hit title Draw Something, which was No. 1 for a short period of time. He didn’t actually name the two companies, but it was implied.

“Right now, what I’m starting to see is valuation expectations that assume that these things are all hockey stick moving up and to the right with no end in sight, and I think those are bad assumptions,” he said. “Some of them will work, some of them won’t, but they can’t all be worth the multiple that I’m seeing in the market right now.”

But the company reported fewer than expected users for Star Wars: The Old Republic, which had 1.3 million subscribers at the end of the year, falling short of analysts’ expectations, who were estimating that the company would report roughly 1.6 million subscribers for the online game.

In response, the company’s stock was down more than 10 percent in after-hours trading at $13.60 a share. The drop is especially harsh given that the company’s stock has fallen 20 percent over the past few months.

As part of the financial release issued today, the company tried to paint a rosy picture of the company’s digital future.

In the fiscal year 2012, it generated $1.2 billion in digital revenues, exceeding its goal of $1 billion this year, and representing a 47 percent increase year over year.

In an interview, EA’s interim CFO Ken Barker said the company is forecasting digital revenues in fiscal 2013 of $1.7 billion, representing a growth rate of 40 percent. At those levels, he said digital will now comprise 40 percent of the company’s overall revenues, breaking away from its reliance on traditional packaged goods.

Barker noted that in the past six months alone, FIFA 12 was able to break $100 million in digital revenues, a first for one of its packaged goods titles.

The company said mobile revenues totaled $87 million in Q4, up from $70 million in the same period a year earlier. It also said the number of users who played a social game at least once in a given month was up, totaling 49 million in Q4, up from 36 million in the year-ago period.

For the fourth quarter, the company reported non-GAAP earnings per share of 17 cents on revenue of $977 million. Analysts were expecting EA to earn 16 cents a share on revenues of $960 million. EA’s own estimates were calling for a profit of 10 to 20 cents a share on revenues of $925 to $975 million.

When applying strict accounting rules, the company’s earned GAAP net income of $400 million, or $1.20 a share, on revenues of $1.4 billion. The same quarter a year earlier, the company recorded a profit of $151 million, or 45 cents a share, on revenues of $1.09 billion.

The first quarter, which has only one retail game but 11 digital games scheduled to launch, will be predictably softer. The company expects revenue of $950 million and profit of 40 to 48 cents a share.

Since the company’s last earnings release in February, the videogame publisher’s stock has fallen 20 percent, and on Friday, it tumbled another 3.5 percent, or 55 cents, to trade at $15.12 a share.

In general, the market for game stocks are teeter-tottering, as the industry works through a massive transition from packaged goods sold at retail to digital games that are given away for free and distributed through Apple and Facebook.

Even pure plays like Zynga — which are focusing exclusively on mobile and social — aren’t immune, as investors question the free-to-play model and the dependence on third-party platforms. Zynga’s stock is off almost 20 percent since its IPO in December.

This afternoon, analysts are expecting EA to exceed the company’s internal guidance by earning 16 cents a share on revenues of $960 million. EA’s own estimates are calling for non-GAAP earnings of 10 to 20 cents a share on revenues of $925 to $975 million.

As a sign of the times, Wedbush analyst Michael Pachter revised his expectations down by $5 million due to U.K. games retailer Game Group going bankrupt during the quarter.

Otherwise, Pachter said that he’s expecting the company to report at the high end of the guidance, thanks to strong sales of Mass Effect 3, which went on sale during the quarter, and to a solid performance by the company’s online game, Star Wars: The Old Republic.

Other console titles shipped during the quarter include FIFA Street and Tiger Woods PGA Tour 13.

Instead, the company is focused on building games for smartphones.

“We are maintaining the old games, like Happy Aquarium, but we don’t build new Facebook PC games any more — we are 100 percent focused on mobile,” Relan said.

Last year, he said, 90 percent of the company’s revenues came from Facebook, but he predicts that this year 90 percent will come from mobile.

CrowdStar’s decision to leave Facebook is bad timing for the social network it as nears its public offering.

A platform must have both a lot of applications and a lot of users in order to be successful, but if the perception is that the platform can be profitable only for a few, developers will go elsewhere. Today, the reality is that Zynga dominates the charts and makes far and away more money than anyone else. Meanwhile, fledgling developers are seeking financial alternatives.

Founded in 2008, the Burlingame, Calif., company was one of the first to feed off of Facebook’s social graph, which allowed companies to endlessly post messages on players’ walls to get the word out about their games. Since those viral channels were shut down, Crowdstar has had a difficult time keeping up with social game leaders, such as Zynga, Electronic Arts, Wooga and King.

A year ago, the company raised its first round of funding totaling $23 million, but since then, its games have slipped in the rankings as its focus has shifted to mobile. Today, it attracts fewer than 8 million monthly users, down from 29 million a year ago, according to AppData.

Since then, said Relan, they have discovered an attractive audience on mobile, consisting of females age 13 to 30 who are not interested in sitting in front of a PC or a console to play games. “They are very mobile and communications-oriented,” he said.

For example, Crowdstar’s Girl franchise, including Top Girl, Social Girl and Modern Girl, has collectively hit 20 million downloads across both iPhone and Android. Modern Girl alone surpassed two million downloads within three weeks of its launch.

The Girl franchise includes role-playing games where users dress up avatars and are judged on their outfits as they walk the runway.

Relan said Zynga has done a good job serving the females, aged 35 and over, who grew up on PCs and enjoy playing games online. But the slightly younger demographic is looking for a different kind of game play on a different platform. Relan said they still will leverage the Facebook platform on mobile.

The decision to pull away from Facebook on the PC is new since the company announced a three-prong strategy in October that included Facebook games, mobile games and an emphasis on Asia.

Relan said that even if the company weren’t targeting a niche that gravitated toward mobile, he’d still be wary of developing games for Facebook. That’s because he believes the audience for Facebook games has plateaued or started to decrease.

“If I was going after an older audience, I might focus on tablets,” he said.

In an interview with Bloomberg, CEO Mark Pincus said he’s looking for both great teams and companies that have break-out hits.

It’s not a big surprise that the social games company would go on a buying spree.

As the largest social games developer on Facebook, it has created a hits-driven business, and since it is virtually impossible to sustain a near-perfect record of hits, it must also buy them.

The San Francisco company also has the resources to pull it off. Thanks to its IPO last year, it has $1.81 million billion in cash and no debt, and in January, it hired Barry Cottle from EA to head-up acquisitions and corporate development.

OMGPOP is a case in point: It developed a game called Draw Something, which was an instant sensation on iPhones and Android devices. Zynga paid more for the 40-employee company than it did for the past 22 acquisitions combined. Over the past year, it also tried aggressively to purchase both Rovio and PopCap, which ended up selling to Electronic Arts.

And now it’s telling the world that its purse strings are loosening.

“We’re sitting in a very advantageous position,” Cottle told Bloomberg. “We have a significant amount of cash, we have no debt, and we have access to debt to be as aggressive as we need to be.”

Startup Grind, which first reported the layoffs, said between 500 and 1,000 employees will be affected, representing between 5 percent and 10 percent of the game-publisher’s workforce.

In an emailed statement to All Things D, the company said: “EA is growing and looking to hire hundreds of people for our digital, console, mobile and social games. Like all game companies, we make occasional adjustments to resize teams as projects are completed and new priorities are established. Overall, we expect that headcount will be up at the end of this year.”

Our sources indicate that the layoffs will be closer to 500 and are tied to the company’s game schedule. Last year, the company shipped two epic projects: Battlefield 3 and Star Wars: The Old Republic, which were challenging Activision’s respective dominance in first-person shooters and massively multiplayer online categories.

Once a title shifts, some employees stay on to work on other projects or remain on teams that build new content for the existing games to keep them fresh.

In this case, it appears the cuts show just how many resources the company was investing in these titles before launch. We expect to hear about these titles’ performance in a couple weeks when EA reports fourth-quarter earnings.

Three years ago, the company conducted a larger restructuring, totaling 1,500 employees.

Still, the Redwood City, Calif., company has aggressive hiring plans. Previously, it disclosed it wants to hire 5,000 engineers by the end of the decade to help build a platform, crossing all of its labels, including mobile, social and console. In particular, CTO Rajat Taneja has been bulking up his team since joining EA in October and now has 600 people on staff.

In afternoon trading, EA’s stock was down more than 5 percent, or 89 cents, to trade at $15.29 a share. Over the past year, it has traded as high as $26 a share.

As it turns out, Electronic Arts’ most popular game on Facebook, The Sims Social, is a perfect candidate for in-game advertising.

“It lends itself well with brands,” said Dave Madden, EA’s SVP of global media solutions. “Across The Sims Social, there’s nutrition, hygiene and careers.”

After all, it’s much harder to work a bottle of shampoo into a game that’s set in the forest or at a poker table. But when a game is about sleeping, eating microwave dinners or taking showers, that sort of product placement becomes much easier.

That’s how Unilever got interested.

In January, the massive consumer brands company — known for being the second-largest advertiser in the world — kicked off a multimillion dollar, year-long advertising campaign with EA.

It started with providing a virtual Dove Hair Spa in the Sims’ bathroom, where people’s avatars shampooed using the “Care & Repair with Dove Hair Therapy shower.” Upcoming Unilever products will include ice cream brands for the spring and summer, such as the new Magnum Mini ice cream bars, Yosicle ice pops, Cornetto ice cream cones and Heartbrand ice cream.

Because the advertisements offer virtual goods for free, players don’t typically mind interacting with the product placements. The Sims Social offers a fairly large global audience, attracting roughly three million daily users and 17.2 million monthly active users to make it one of the top 15 games on Facebook, according to AppData.

While advertising in social games by Electronic Arts or other big publishers like Zynga isn’t new, Madden said it is becoming more routine.

“Everyone knows the audience is there, and that they are spending a lot of time in the games, but from a media standpoint, it’s still been fairly new,” he said. “For a global company like Unilever to want to partner with EA and launch a campaign globally, it’s an indication that gaming is finding a stage.”

To accommodate the interest, Madden said they’ve created a rate card, developed four types of in-game advertising features, and have determined a calendar for how much integration work the developers can handle.

Here are the four advertising types that EA has focused on:

1. Traffic Drivers: Typically, these ads drive players in the game to visit a brand’s Facebook page, where they can download a free in-game virtual good. In a two-week period, more than one million players from The Sims redeemed the Dove Hair Spa virtual items in their games, and 50 percent of the players chose to “Like” the brand on their own accord.
2. Quests: These are the deepest and most involved. Players will have to take a number of steps inside the game to earn a valuable item at the end. For instance, Toyota launched a quest where players earned a Prius.
3. Store Tabs: In the virtual goods store, there will be a whole tab dedicated to the brand. Unilever, which plans to do all four types of advertising, plans to roll out a Dove tab, where users will see five items related to vanity and hair care.
4. Media Integrations: Users can watch a short video advertisement or other type of media, to unlock a virtual good.

Its multi-million dollar investment in Star Wars: The Old Republic, is starting to pay off.

In EA’s third quarter, the massively multi-player online game generated 1.7 million active subscribers and sold more than two million units in a little over one month.

Is that enough units sold to call off the critics?

In an interview, EA’s CFO Eric Brown said he thought so. ”We were able to sell more units beyond what we were able to plan, and because of that, it was a big part of the upside of our EPS of 99 cents a share,” he said.

The company said non-GAAP diluted earnings per share, which excludes acquisition costs and other non-cash items, totaled 99 cents, exceeding its guidance of up to 95 cents, and exceeding analyst expectations of 93 cents.

The company’s non-GAAP revenues also exceeded estimates, totaling $1.65 billion, which was slightly above the top end of internal guidance and the $1.61 billion that analysts were looking for.

Additionally, its big first-person shooter, Battlefield 3, performed well.

To date, Brown said the game has sold 11 million units, and that it was able to gain 12 points of market share in the category year over year. “It’s an incredible success,” he said.

Still, in after-hours trading, the company’s stock continued to slip, dropping 4.3 percent, or 79 cents, to $17.65 a share.

The company’s fourth-quarter outlook suggests that it will not be able to sustain the levels seen at the end of the quarter. It predicts that non-GAAP revenue will be between $925 million and $975 million, and earnings per share will fall between 10 cents and 20 cents.

In the third quarter, EA’s GAAP revenues, which follow all accounting standards, totaled $274 million. Its loss per share was 62 cents, weighed down by the acquisition of PopCap as well as other expenses.

Brown said it was also worth calling out that its digital revenues for the 12 months ended in December hit $1.07 billion, exceeding the company’s goal of hitting $1 billion in digital revenues by March.

Digital revenues in the quarter grew 79 percent year over year with the assistance of Star Wars and digital revenue coming from Battlefield 3, he said.

The videogame company’s stock has also been hammered by recent concerns about how well its new online blockbuster title Star Wars game is selling after launching in December.

In 2011, U.S. retail sales of new physical videogame content — including portable and console hardware, games and accessories — totaled $17.02 billion, an 8 percent decline over the $18.6 billion generated the year before, according to NPD.

Additionally, multiple reports indicate that while unit sales were up year over year in December, overall revenues suffered from steep discounting. Game retailers, such as GameStop and Amazon, both reported that holiday sales fell below expectations.

Electronic Arts’ third-quarter figures will be released today after the bell.

Its stock is trading down 12 cents, or .62 percent, to $18.46 a share. That has fallen significantly from its recent high of $25.20 back in November.

Back in October, the company said it was expecting third-quarter revenues of $1 billion to $1.1 billion and a loss per share of 77 cents to 63 cents. Excluding some stock-based compensation, acquisition-related expenses and other charges, the company said it is expecting a profit of 85 cents to 95 cents a share.

Analysts are expecting revenues of $1.61 billion and earnings per share of 93 cents.

The company also faced a setback when it announced that Barry Cottle, who was in charge of the company’s digital efforts, was leaving the company. Cottle took a job with Zynga, the company’s rival when it comes to talent and publishing games on Facebook.

And, while the industry is continually contracting on the hardware and physical retail front, one area of tremendous growth is digital.

At the time of Cottle’s departure, which was the third high-profile steal Zynga made over the past year, EA confirmed the company had achieved more than $1 billion in digital revenues in 2011.

Digital revenues include everything from downloadable content on consoles to social games, like the company’s hit The Sims Social, to the new release of Star Wars: The Old Republic, which is set to challenge Activision’s World of Warcraft game.

In the second quarter, EA said digital revenues were growing 30 percent year over year, and because of that, it was able to raise its full-year guidance.

Check back here to see if the company can deliver.

Electronic Arts is predicting that the New York Giants will defeat the New England Patriots in the Super Bowl, by a single field goal.

For the past several years, the videogame publisher has been using its hit title Madden NFL to simulate the outcome of the Super Bowl — and in six out of the past eight matchups, it has guessed correctly.

But unlike the camel in the New Jersey zoo that has picked the winner of five of the last six Super Bowls, EA breaks down the score quarter by quarter.

EA simulates the Super Bowl by using artificial intelligence and real data from each team. It even includes variables such as injuries. The simulation is powered by Madden NFL and Xbox 360, the official console sponsor of the NFL.

EA replays the game’s highlights in a video, including Giants quarterback Eli Manning being named MVP for completing 25 of 39 passes with two touchdowns, and the Patriots’ Tom Brady throwing for 327 yards and three touchdowns.

Spoiler Alert: To win the game, Giants kicker Lawrence Tynes will make a 40-yard field goal, with the final score 27-24.

But one of PopCap’s original developers, Roy Liu, believes he has come up with an alternative. Gimmie, based in San Francisco, has created an incentives platform for mobile app developers.

It launches today with 10 mobile app developers in its beta program.

It works like this: In return for using the app, a player can earn points which can be redeemed for real-world products. It’s sort of like a traditional arcade, where players earn tickets that can be redeemed for candy and toys, but instead of gumballs and baseball cards, Gimmie primarily doles out game downloads and other mobile content.

Gimmie is also announcing today that it has raised $200,000 in funding from Tandem, an incubator in Silicon Valley.

Liu, who was one of the lead developers on Plants vs. Zombies for PopCap before it was purchased by Electronic Arts, co-founded the company with CEO David Ng.

The idea is not so different from other in-game incentive programs, which ask users to fill out a survey or download a different game in exchange for free virtual goods or other benefits.

Those types of programs, served by companies like TapJoy and others, have been immensely successful — although more recently, they have been received poorly by Apple and others because they can affect the most popular games list.

Gimmie believes what it is doing is different because it rewards users with items outside of the app for performing actions inside it.

Other companies are also trying to come up with alternative advertising platforms for mobile games. In games, banner ads are often completely ineffective because people are focused on playing the game, and don’t take the time to read the ad or leave the page to investigate it further.

A Chicago-based start-up called Tap.me is creating an ad network for virtual goods, which can gain advertisers on a broad scale for generic items, such as being able to jump higher or more energy across many games.

The two independent moves illustrate how quickly the social games industry evolves.

Rather than tell the stories separately, here’s an overall look at how Google plans to chip away at Facebook’s dominance as a platform, and how EA is challenging Zynga as the top social game maker.

Google said this morning that its third exclusive game has launched on Google+, meaning that it will have the game before any other social network for the next 30 days. The other two were Rovio’s Angry Birds and Kabam’s The Godfather.

The new game, Pirates: Tides of Fortune, was created by Israeli developer Plarium.

The game has a city-building theme, where you must build rum distilleries, lumber yards and gold mines so you can build ships and defend yourself. A fun twist is that the game can be set to speak to you in Pirate or English, French, German, Spanish or Russian.

Meanwhile, Electronic Arts, the second-largest social game maker on Facebook behind Zynga, is following up the successful launch of The Sims Social with a Hasbro game title, Risk: Factions.

Instead of replicating the board game or console version of the game, EA says it has added a plot. Players must pick a faction, either the Humans, led by General William P. McGutterpants; an army of fearless Cats led by the honorable Generalissimo Meow; or a militia of brain-starved Zombies led by the cadaverous Colonel Stiffenberg.

Each develops special weapons, which give each faction a different strategy, and then players get to attack one another by rolling the dice. Players can also develop their military base to build up their troops and construct factories to produce weapons.

Some social games companies are opting to offer Google an exclusive because the search company says it will help promote the game. Also, although Google+ has a smaller network of users, it takes a smaller cut of the revenues — 5 percent compared to Facebook’s 30 percent — so it’s possible any revenue difference can equal out.

Still, Facebook has the larger gaming presence, totaling around 200 million users worldwide. At this point, it isn’t worth mentioning that it has gained a new exclusive, either.

Zynga easily tops the social games charts, but Electronic Arts is slowly creeping up through a combination of acquisitions and games based on well-known brands.

At one time, The Sims Social was close to toppling Zynga’s CityVille game as the largest game on Facebook, but it has since slipped in the rankings, trailing behind several other Zynga titles, according to AppData.

EA has launched other Hasbro titles on Facebook, including Scrabble and Monopoly Millionaires, but neither became an overnight hit. Its second-most popular game is Bejeweled, which it gained through its acquisition of PopCap in July.

At one point today, the stock dipped as low as $7.97 a share before closing at $8 even.

At that price, it is $2 below it’s initial stock price of $10, and has lost at least 20 percent of its market value in less than a month.

But why?

The San Francisco social games company has launched at least two new games since going public, and over the past few days, no harsh analyst report has come out with a negative rating.

It appears the once high-flying Silicon Valley company — known for addictive games on Facebook like FarmVille and CityVille, and mobile games like Words With Friends — is having a hard time gaining the market’s confidence.

To be sure, there’s no clear answer for the price drop; and other tech companies that recently went public, such as Groupon or LinkedIn, have experienced their own fluctuations. But there is one theory making the rounds.

Analysts and other sources suspect Zynga’s stock has been propped up over the past month by the underwriters, who agreed to buy shares if the stock started to perform poorly. The stock purchases would have created steady demand for the stock and kept the price relatively stable.

Furthermore, the theory goes, the underwriters have since met their obligations for buying the stock, and therefore are are no longer buying as many shares.

Incidentally, on Friday, Morgan Stanley — one of Zynga’s underwriters — disclosed that it had purchased nearly 16 million shares in December.

But while the disclosure, filed with the with the Securities & Exchange Commission, adds fuel to the theory, it is unclear if those shares were purchased as part of the IPO, or if they were spread out throughout the month.

Zynga declined to comment, citing its quiet period.

Still, whatever the reason for the drop, Zynga’s shares are seeing less demand.

As recently as last week, the stock was trading at $9.45 a share, but since then, it has struggled to stay above $9. On Friday, it lost 12 cents; today, it lost 81 cents, or 9 percent.

But even if the underwriting theory is on the mark, it doesn’t explain the broader question of why Zynga’s stock price is falling. Shouldn’t there be other investors who are willing to buy up a piece of Zynga?

Unfortunately, it seems the market isn’t sure what to do with the stock, or how to value it.

A social games company fits somewhere between traditional game makers, like Electronic Arts and Activision; and an Internet stock, like Google or LinkedIn.

Zynga gives away its games for free, but still manages to be profitable from selling virtual goods, such as a tractor or more power-ups, that a small number of players elect to purchase inside the games.

It’s also heavily reliant upon Facebook, which could be another problem. Facebook, too, operates privately, and reveals only as much information about its business as it has to — at least until it files to go public, which could be later this year.

In all likelihood, many of these investor fears could be settled when Zynga reports its first period as a public company. No word on when that will be yet, but the fourth-quarter report should come as soon as this month, and no later than February.

The drop-off in players affected almost all developers, but did not hit all titles equally.

For example, Electronic Arts saw 1.2 million fewer monthly users over the past week for its top title The Sims Social; Zynga’s Empire & Allies game lost one million monthly users, and its newest game, CastleVille, lost 900,000, according to AppData, which publishes such information.

On the flip side, many of the games that performed well were old favorites; these logically would have longer-term, more-committed players, who would make a point of returning during the holidays to take advantage of seasonal promotions.

The games that benefited from the holidays include Zynga’s Words With Friends and FarmVille, which gained 1.3 million and 800,000 monthly active users, respectively, according to Inside Social Games. Other gainers rounding out the Top 5 were Tetris Online’s Tetris Battle; Wooga’s kingdom-building game, Magic Land; and Men vs. Women, a role-playing game by Social Point.

Still, the general direction for the week was heading down.

That contrasts with other game platforms, such as consoles, PCs and mobile, which largely benefit from the holidays and from more free time in general.

Console games often skyrocket in popularity as kids and adults unwrap new titles for Nintendo, Xbox or PlayStation on Christmas morning.

PC gaming also typically surges during the season. EA timed the launch of Star Wars: The Old Republic ahead of the holidays, in hopes of drawing new players who would be sold on sticking around for months, after spending time on the game during their time off.

But perhaps the biggest competitor came from mobile, which benefited from breaking records for the number of new Android and iOS devices that were gifted during the holidays. Flurry reported that more than one billion apps were downloaded worldwide during the last seven days of 2011, breaking the all-time weekly record. Games are often one of the most-downloaded categories of apps.

So the more important question to ask is, why would Facebook be an exception, if other platforms performed well?

Clearly, all of the platforms are competing for a limited number of minutes in the day, and so are other forms of media, like the Internet, TV and the movies. But when it comes to Facebook, a larger driver may be the environment — after all, it’s no big secret that a lot of social networking and social gaming is done in the workplace.

In a study conducted last summer, advertising agency Saatchi & Saatchi found that 47 percent of respondents said they play social games at work during a typical day, and that 28 percent play for at least 30 minutes. Without that dedicated time in front of the computer every day, people may have had the opportunity to be more obsessed with other screens, such as phones or TVs.

Another potential reason that Facebook and social games did not see a lift from the holidays is because they have not yet figured out how to capitalize on the Christmas economy.

For years, console games have been timed with the end of the year, so they could be wrapped up and placed under the tree. More recently, smartphones and gift cards for music and apps have helped mobile prosper. Perhaps there wasn’t enough hype and promotion for social games to compete for people’s dollars.

Regardless of the reasons, the drop may ultimately be a small a blip on the radar screen for most game developers, who also see several spikes in activity during the year.

The bigger impact may be felt at Facebook, which takes a 30 percent cut of all virtual goods sold inside social games, and would feel the cumulative impact across all of the games.

For players, the goal is to clear as many gems as possible, but going forward, PopCap’s goal is to get as many people as possible to play the game.

To do so, the company’s strategy is to make it free.

AllThingsD visited PopCap’s Seattle office this week, and caught up with Giordano Bruno Contestabile, franchise business director for Bejeweled, to see how the game is evolving after more than a decade.

Earlier this year, PopCap was acquired by Electronic Arts for up to $1 billion, thanks to Bejeweled and other hit games, including Plants vs. Zombies.

Up until now, players had to pay for Bejeweled in order to play it, but PopCap has recently launched free versions on Facebook and the iPhone.

In the free version, players can challenge others to score as many points as possible in one minute. They have the option to pay for “power boosts” to increase their odds.

A paid version on the iPhone allows players to knock out gems without a time limit.

With the switch to the free-to-play model, Contestabile said, PopCap has a way of reaching a half a billion users, up from 40 million paid users. That’s comparable to Rovio, which claims to have achieved 600 million downloads in two years — both free and paid.

In this video interview, Contestabile talks about the benefits of the approach, while also disclosing that Microsoft and Electronic Arts had the chance to buy the game a decade ago for cheap, but passed: