About a year ago, RealNetworks said the elimination of about 10 percent of its workforce officially marked the end of a difficult restructuring period, one that saw nearly 400 layoffs since 2009 and left the digital-media pioneer more focused, efficient, and ready for the future.

Turns out that was just a prelude.

On Thursday, the dot-com era survivor announced it was selling a chunk of its video software and some patents to Intel for $120 million. The deal, which significantly boosts RealNetworks’ cash reserves, also sent its stock price (NASDAQ: RNWK) rocketing up by a third. And it’s a signal of things to come as new CEO Thomas Nielsen repositions Real to focus on a smaller set of businesses.

Nielsen, a former VP at Adobe, joined RealNetworks in November after what founder and chairman Rob Glaser called the most exhaustive hiring process he’d seen in his career. Since then, Nielsen says, he went through a “bottom-up” review of everything the company did, and came away surprised at the sprawling businesses the company had been chasing.

Thomas Nielsen

If he had to give an elevator pitch for RealNetworks’ businesses, Nielsen joked, it would have to be in a very tall building. That won’t be the story in the future, however—Nielsen says the next several months will showcase more changes that reflect his strategy to refocus RealNetworks. And there is very little that is off the table.

“I’m basically turning over all the rugs within the company right now and looking at where there is value in each of our businesses—which ones will be strategic moving forward, and which ones won’t,” Nielsen says. “It’s very unlikely that this is a one-time transaction. On the same level here, I’m not trying to sort of break up the company into little pieces … My job, and what I’m doing here over the next 12 to 18 months, is really to focus the company and be really good about not being in 26 businesses, but being really good about one vision and one mission.”

The stock price shows how welcome the approach is on Wall Street. But new signs of life at RealNetworks will also probably be welcomed within the overall tech and business communities in the Seattle area. Real has produced plenty of notable alums over the years—including a U.S. senator!—and was once among the calling cards of a vibrant tech scene in the Emerald City.

In more recent years, the company has been kind of a question mark. Its once widely used media player software was bypassed by competitors even as Web and mobile video and music consumption skyrocketed, its Rhapsody music joint venture was spun out, and consumer offerings in cloud services and gaming were getting a new focus.

The game unit, GameHouse, has been discussed as a spin-of candidate in the past. But under new president Matt Hulett, GameHouse has focused heavily on the rapidly growing social games business, as AllThingsD’s Tricia Duryee detailed recently.

Asked about GameHouse’s future, Nielsen first talked about the ways that gaming was going through massive transformations in audience, distribution, and business models with the spread of social and mobile platforms. He also said that the company was “firing on all cylinders on social and mobile, and we have several things coming out over the next few months that will fuel that.”

At the same time, he said it’s still too early to tell how that fits into the company’s long-term plans.

“If RealNetworks becomes a powerhouse in gaming, then GameHouse should belong there. And if we decide to take a very different direction, then we will explore options like—I do realize that previous management looked at spinning it off,” Nielsen says. “It’s not off the table, but nothing’s off the table right now. It goes back to focus. I don’t think we can be in the gaming business and the potato-chip factory business and the networking business.” (No, they don’t really own potato-chip factories).

The sale of the RealNetworks’ video codec software, which makes those files easier to stream, means seven employees from that unit will be joining Intel. Nielsen acknowledged that the rather large restructuring he’s talking about would result in cutting some jobs, but he said the idea is to grow the remaining businesses rather than just getting smaller overall.

“I don’t have a target, but what I do know is that you don’t cut your way to growth,” he says.

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Amazon.com’s cloud-computing services already power some of the biggest names in online gaming. Its new Kindle Fire tablet and app store are giving game publishers a critical new sales channel. And now, the e-commerce pioneer appears to be getting more serious about publishing its own games.

Over the last few months, Amazon (NASDAQ: AMZN) has ramped up job postings for game developers, artists, designers, and producers at both an Orange County research and development office and, for jobs focusing on social games, at its Seattle headquarters. Several notable names from the gaming industry have also joined the company recently, with a range of experience that spans many different gaming genres.

Some game publishers—who count Amazon as a key partner—have now concluded that it could become a competitor as well. Not much is known about what the secretive company is working on, and no sources who suspect Amazon is planning a bigger push into game publishing would comment on the record for this story. Amazon itself did not respond to e-mailed requests for comment.

But, as is often the case, you can tell what the company is planning by what it’s telling prospective job applicants.

In ads for developer, engineer, and producer jobs, Amazon describes its game development studio as a place to “imagine and develop games that will shape the future of interactive media,” with “an agile team made up of the brightest engineers, artists, producers and designers in the industry.”

The scope of what the company says it plans to build is pretty wide, pointing toward the all-platforms gaming experience expected to soon be standard in the industry: “We conceptualize, build and distribute the most exciting and addicting games on Android, iPhone/iPad, Kindle, HTML5 and other next generation operating systems!” The studio is based in an Orange County, CA, office of the company’s a2z research and development subsidiary.

Digital game publishing isn’t completely new territory for Amazon, but it’s been relatively quiet so far. The company purchased small game studio Reflexive Entertainment in 2008, and that unit has continued to publish some casual titles and e-book games for the Kindle digital reader—examples include cheery casual game Airport Mania 2 and interactive e-book Dusk World.

But now that Amazon has introduced its new full-color, touchscreen Kindle Fire tablet, it’s got a much stronger hand in selling digital games—and a much bigger reason to explore creating its own titles. Tellingly, the company’s job board lists six new game studio positions since the public introduction of the Kindle Fire, including three that were just posted yesterday.

Meanwhile, up at its Seattle headquarters, Amazon is building up a group that focuses on “social games innovation.” The company’s job board lists a dozen open positions mentioning that team, most of them posted in the past three months. Some of the jobs being advertised could be suited to a platform project, rather than game production. But job descriptions for designers and artists are pretty specific about the kind of work needed to produce a title. The artist, for example, is expected to “set the artistic direction [of] a new social game.”

Word of a social gaming project started leaking out last summer when the website IndustryGamers reported that Amazon had hired longtime role-playing-game designer Jonathan Tweet to work on a social game, following his stint working on Facebook games at GameHouse, a division of Seattle-based RealNetworks.

Since then, Amazon has accumulated more experienced game-industry talent. They include Nik Davidson, a veteran of massively multiplayer online games; Paul Furio, who has experience in social and casual games, as well as interactive fiction; and Russ Glaser, a user experience designer who worked on several high-profile projects for Microsoft’s Xbox Live service, including Xbox Live Mobile and the integration of Facebook.

Some don’t think that Amazon is too serious about becoming a major game publisher. GameHouse president Matt Hulett says Amazon will probably use its industry talent to strengthen its distribution platform, possibly developing demonstration titles to show off the strength of its platform.

“Remember ‘Minesweeper’ on Microsoft Windows? Sometimes you need a couple of reference apps that are bundled in so that people know what to do,” Hulett says. “I just seriously doubt that Amazon would try to build its own hit games.”

But there are precedents for just such a strategy. For one thing, it’s quite common for big video game distribution platforms to produce their own titles—Microsoft, Valve, and BigFish Games are three prominent examples just in the Seattle area.

Amazon also has shown an interest in producing other kinds of content that it sells. After years of disrupting the business of selling books, Amazon is now directly taking on the publishing houses by signing up its own authors. And it’s also exploring new ways of getting movies made with its Amazon Studios project, a complement to a new video-streaming business.

That’s before we even discuss the plain dollars-and-cents reasons. Video gaming has been a relatively strong area of the overall media industry in the past decade, pulling in an estimated $16.5 billion last year. The console game sector may have suffered, but social and casual games continue to be hot, despite Facebook game-leader Zynga’s sometimes disappointing IPO—in Seattle alone, we saw PopCap Games acquired for up to $1.3 billion and Double Down Interactive sold for up to $500 million. And games continue to be the most popular smartphone apps, according to tracking by the research firm Nielsen.

Finally, don’t forget that Amazon started life as a seller of media—namely books—and views its new Kindle Fire in that vein, with CEO Jeff Bezos recently telling Wired that the device is “a fully integrated media service.”

If integration’s your thing, it’s pretty hard to beat this recipe: Owning the game itself, the app store that delivers it, the computing power that makes it tick, and the device that it lands on.

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Turns out gambling with digital money can pay off pretty big, too. Seattle’s Double Down Interactive, maker of casino-style videogames for social networks, is being purchased by slot-machine giant International Game Technology for up to $500 million.

Rumors of the sale started trickling out this afternoon, and IGT (NYSE: IGT) confirmed the purchase just after markets closed. The price includes $250 million in cash, $85 million in retention payments over two years, and $165 million in performance incentives over the next three years.

Like many of the top Facebook games, DoubleDown Casino is free to play. Once they get hooked, players pony up for virtual currency to keep their streak going. They can’t cash it out, since that would be actual gambling—but rules on that front are changing quickly, which helped push IGT to grab the startup.

For years, the federal Justice Department has forbidden online gambling under an interpretation of the federal Wire Act. But the DOJ recently flip-flopped on that stance, opening the door for the possibility of regulated online gambling in the near future. That brings us to today’s Double Down deal.

Even without those regulatory factors, the startup was doing pretty well. Double Down’s sole game, which has several casino-style games inside it, was named by Facebook as its No. 4 most popular game of 2011. Independent tracking from AppData says the DoubleDown Casino had 4.7 million monthly active users. Earlier this year, Tricia Duryee of AllThingsD reported from unnamed sources that Double Down was on a path for about $50 million in annual revenue.

It’s a big win for Double Down, which was founded in 2010 and has about 80 people—including a pair of executives lured away from fellow Seattle casual game company BigFish Games. But it’s not a jackpot for the area’s VCs—Double Down was started with the profits from founders Greg Enell and Cooper DuBois’ previous gaming company, along with one other (unnamed) investor, but that’s it.

In its release, IGT says Double Down CEO Enell will remain in charge of the operation in Seattle, and that it will run the property with “the appropriate level of independence needed to continue to foster exceptional growth.”

We expect to hear more on this deal, and the dramatic rise of social gaming, tomorrow as the executives give interviews. But it’s safe to say that one of the Seattle area’s traditional tech strengths, gaming, is leading the pack these days—take a look back to 2011′s megabucks sale of PopCap Games to Electronic Arts, and a group of smaller acquisitions along the way.

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[Editor's note: As a New Year's exercise, we asked a select group of Xconomists to answer this question: "What's the craziest idea out there that just might succeed?"]

That technology can actually play a significant positive role in education. The false promises go back at least 100 years—to extravagant claims by Thomas Edison. Certainly “computers in theclassroom” have contributed relatively little to this point—evenhighly principled attempts are yielding results that are, at best,controversial. (See the New York Times recently on Carnegie Learning.)

But one has to believe that there is hope, in the next 10 years, for advanced adaptive tutoring systems, and for games that embody entirely new approaches to interactive learning. Zoran Popovic at the University of Washington, whose Foldit protein folding game was recently credited with solving an AIDS-related molecular puzzle that had baffled scientists for a decade, has $15 million in research funding from the Bill & Melinda Gates Foundation and the Defense Advanced Research Projects Agency to study games for learning in his Center for Game Science.

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SweetLabs co-founder Chester Ng tells me a new class of intense social network games are threatening to disrupt some of the established players in the desktop gaming business, such as Activision Blizzard’s World of Warcraft and Electronic Arts’ Star Wars franchise.

Perhaps.

Today, as EA releases its much-anticipated Star Wars: The Old Republic, San Diego-based SweetLabs and Kabam of Redwood City, CA, are launching new Pokki desktop apps for four popular Kabam games: Dragons of Atlantis; Edgeworld; The Godfather: Five Families; and Thirst of Night.

As we reported in June, SweetLabs launched Pokki as a new platform (for Windows PCs) that gives desktop users easy-to-access apps with an “always on” experience more familiar to smartphone users. After creating a number of utility apps, Sweetlabs is now expanding its Pokki product line by introducing game apps for Pokki that enable users to quickly get into Kabam’s massively multiplayer, synchronous strategy games.

SweetLabs, which got $13 million in venture funding three months ago from Intel Capital, Google Ventures, and Bessemer Venture Partners, also announced a “Pokki 1Up” contest. The company is offering a total of $50,000 in cash prizes for developers who create new Pokki game apps.

SweetLabs ran a similar contest, the “Pokki Challenge,” just a few months ago as an incentive to encourage programmers to build out the Pokki app catalog. Before launching Pokki six months ago, SweetLabs developed a variety of apps for its own platform, including apps that enable users to easily access Facebook, Rdio, Gmail, Twitter, and other websites.

At the end of November, SweetLabs said developers submitted more than 60 apps and its Pokki judging panel selected Mixtape, an app by Mohamed Tedjani Meftah, for the $30,000 grand prize. Chess by Jeet Singh received the $13,000 second prize, and Instagrille, a photo app by Denis Denisyuk based on the popular Instagram service, took third place with a $7,000 prize. The contest enabled SweetLabs to make all the winning apps, along with a number of additional apps created for the Pokki Challenge, available for downloading at www.pokki.com/contest.

Creating game apps that are available without the inconvenience of launching a Web browser is an extension of what SweetLabs set out to do with Pokki, according to Ng, who says SweetLabs’ move into online games will be a killer app.

“These games are highly addictive,” Ng says. “It’s pretty crazy how much time people are playing on social networks like Facebook. We just wanted to make it really easy for users to access their favorite games right from their desktops.”

For Kabam, “This partnership with Pokki expands Kabam game distribution to reach more gamers and provides unique value to our players,” Kabam COO Chris Carvalho says in a statement released today. “It has the potential to usher in a powerful new chapter in core social game distribution.”

The games Kabam customized for the Pokki platform are free, Ng says. Some players, though, acquire virtual goods that can help them score extra points. “It’s free to play,” Ng says, “but as you start to play, you might want to speed up the game.”

SweetLabs’ Ng declined to describe how the partners will share revenue from the new Pokki game apps. “We’re experimenting on revenue-sharing models with all of our partners,” Ng says, “but I really can’t go into any details.”

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For about six months now, I’ve been trying to get Kris Duggan to change the name of his company. To me, “Badgeville” manages to be both faddish and inaccurate: it tries to snag a little of Zynga’s (fading) Farmville glory, while also suggesting that the Menlo Park startup’s business is all about gamification and virtual badges, à la Foursquare—which it’s not, as the CEO is the first to emphasize.

Alas, it looks like Duggan has dug in about the name. “I’ve gone back and forth, but my current outlook is that we are going to be 100 percent married to it,” he told me this week. “If you were the first person to see the name ‘Batman’ you would think that was a little weird too, but once you hear it, it’s kind of cool.”

So I guess I don’t have a future as a startup name consultant. But I’ve enjoyed getting to know Duggan and the company, which appeared out of nowhere (Duggan co-founded it just 14 months ago, in September 2010) to become one of the leading providers of technology for enhancing Web-based communities with loyalty, ranking, and reputation systems. That includes both customer communities and employee communities: fitness company The Active Network, for example, uses Badgeville’s widgets to let users log workouts and share achievements with their friends, while one large enterprise with 100,000 employees (Duggan can’t say which one) uses Badgeville to recognize workers for completing social media training programs.

Kris Duggan

In that big-company example, the recognition actually does come in the form of a virtual badge, which shows up alongside an employee’s name in the corporation’s online directory. But the badge is just a symbol, Duggan says—the startup’s technology is really all about motivating behavior. “We track the behaviors you want to reward, give users credit, and surface that reputation or status wherever you want,” he says.

Badgeville is one of a group of young companies staking out a new space that goes by names like gamification, behavior modification, and social commerce. Competitors include BigDoor, Bunchball, Gamify, Gigya, and Seriosity (proving that Badgeville isn’t alone in having a silly name). But one of the things that makes Badgeville unusual in this group is that it offers a broad platform of services, including a game engine that supports missions and rewards, customizable widgets, analytics software, and a Facebook-like “social fabric” complete with activity streams and friend notifications. The company’s philosophy is that almost any online operation, be it a big enterprise or a consumer-facing retail, education, publishing, or entertainment site, can benefit by putting known motivational techniques to use.

In Badgeville’s world, that means identifying the behaviors an organization wants to encourage among customers or employees; devising rewards and incentives that play on the basic human need for recognition; analyzing how the rewards are working; and continuously tweaking the program maximize the wanted behaviors. When the test prep site Beat the GMAT added Badgeville badges like “Thought Leader,’ “Strategy Guru,” and “Problem Solver” to its site, for example, it motivated some users to spend up to 8 hours a day on a giant crowdsourced project to tag and organize the site’s 70,000 pages of content. Duggan calls the whole incentivization process “behavior lifecycle management.” “It’s a closed loop,” he explains. “You influence and measure and influence and measure again.”

Another thing that makes Badgeville unusual is the torrid pace of its growth. It’s already got 100 customers, including big names like Samsung, Deloitte, CA, and Rogers Communications, Canada’s largest wireless carrier. It has 50 employees—twice as many as when I first visited the company in May—and has raised $15 million in venture funding, which is probably more than all of its competitors put together (except for Bunchball, which has raised $17.5 million). Duggan says Badgeville will collect “somewhere between $5 million and $10 million” in revenue in 2011, and twice that in 2012.

You can chalk up a lot of that growth to plain old economic pressures: companies are looking for ways to keep their existing customers engaged, because that’s usually a lot cheaper than recruiting new ones. “I asked Kris how he was adding customers so quickly, and he said, ‘We’re good at sales, but we’re not that good—it’s the market,’” recounts Tom Peterson, a partner at El Dorado Ventures, one of the four venture firms backing Badgeville. “Everyone is in search of revenue, and how you make your site grow and … Next Page »

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Rolling out a game on two platforms at once is so passé. Why not three at once? That’s the target for Seattle game startup Zipline Games, which is showing off its new game today on iOS, Android, and Google’s Chrome Web browser.

“No one’s been crazy enough to hit three platforms, so we thought we’d put a stake in the ground,” says Zipline CEO Todd Hooper, who’s in Mountain View, CA today for a gaming announcement by Google.

The game is Wolf Toss, a take on what’s known in the industry as a “physics game.” That’s the casual-game format popularized by Finnish developer Rovio’s hit Angry Birds, in which players launch little birds from slingshots to destroy the fortresses set up by a group of marauding pigs that have stolen their eggs.

In Zipline’s Wolf Toss, you’re firing a hungry wolf from a cannon to chase down the three little pigs. The game actually started out as a simple demo months ago—I remember Hooper showing me a proto-version on his phone—but Zipline decided to make it a full-fledged title.

“I handed my phone to a lot of people and said, ‘Hey, here, play it’—and I noticed they wouldn’t give my phone back,” he says.

Like many games of this genre, Wolf Toss is free to play and looks to make money by selling premium content. But it’s also more than a product for Zipline, because it was developed for iOS, Android, and Chrome at the same time using the company’s Moai game developer platform.

Moai is built around Lua, a common programming language for games, and offers a single open-source platform for both the front-end elements seen by consumers and the back-end infrastructure. It allows developers to build their products once and deploy them to multiple user platforms, rather than duplicating efforts for multiple different operating systems.

So if Wolf Toss were deployed to iOS, Android, and Chrome without that system making all the translations, “Then you’ve got three engineering teams and the game costs three times as much,” Hooper says. Moai previously made news by powering Crimson: Steam Pirates, the first release through Bungie Aerospace. Hooper says Moai now has about 3,000 developers signed up.

Even though a service like Moai can simplify the process, it can’t totally eliminate all of the headaches that come with putting a game on three different user platforms at the same time. Everyone has different payment mechanisms for the premium content, for example. There are different approval processes for the app stores. And even different screenshot specs for advertising the games within those stores—a thousand little things that add up for a small company.

“I think we’re unique, and probably also crazy,” Hooper says with a laugh.

Zipline is working on more games, both for itself and others. Check out the video for an idea of what Wolf Toss is like—I see some elements of both Angry Birds and maybe even some old-school Sonic the Hedgehog from the era of Sega consoles, if I’m not mistaken.

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Big video games studios are a bit old school, with everything from game design, production, execution, and financing done in house, says Boaz Sender, a JavaScript programmer at the Boston-based Web consulting firm Bocoup. But they’re about to go the way that the old Hollywood movie studios did, he says, by outsourcing many of the operations they once tightly controlled.

Sender says that’s all going to happen as a result of traditional video games moving to the open Web, which is a set of standardized, royalty free, HTTP- and HTML-based technologies for building network software. The software design principles and content policies behind it focus on consumer empowerment and third-party integration, he says.

“When you move to the Web, one thing that becomes a lot cheaper is distribution,” says Sender. This enables younger, scrappier startups to get involved in building games, and encourages other startups to sprout up that are developing related games software, for functions like game authoring, payment, advertising, and managing player identities.

Bocoup is looking to seed this trend via Game Lab, a small games incubator it’s running with Cambridge-based Atlas Venture with the “goal of funding companies that help the games industry move to the open Web.” It’s particularly focused on HTML5, the emerging new standard for programming Web pages and services.

Bocoup’s 15-person team has spent two years helping companies develop and adopt open Web technologies, through events, evangelism, and consulting for customers like Google, Microsoft, and Mozilla. Sender founded the firm, which consists of a group of (“especially elite,” according to Atlas) JavaScript programmers. They work closely with other Web design-focused consultancies.

Game Lab’s funding model varies from startup to startup, but it could potentially invest in seed rounds for existing companies, help new companies form and seed those, and participate in Series A rounds, says Sender. Atlas is supplying the capital and Bocoup is bringing its expertise in open Web technology to the teams. Entrepreneurs in the Game Lab also get close mentoring from Atlas, and the option of working out of Bocoup’s open source hacker space.

“It’s about how we’re going to fund the building blocks of the open Web games industry,” says Sender. Bocoup is also working with its … Next Page »

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If you’re a hammer, you just want to smash nails; if you’re a programmer, you just want to build features. But features do not a successful product make. This is the central myopia that eventually blinds even the most brilliant engineer-entrepreneurs, unless they’re smart enough to surround themselves with people who can check their bias.

If you want an interesting example of this phenomenon, look no further than Adam Bosworth, the co-founder and chief technology officer at San Francisco-based health gamification startup Keas. There’s no question about this guy’s brilliance. At Citicorp in the late 1970s, he invented an analytical processing system that helped the bank predict changes in inflation and exchange rates. At Borland, he built the Quattro spreadsheet, and at Microsoft, he built the Access database. He was one of the first to propose standards for XML—the foundation of most Web services today. At Google, he helped to develop Google Docs before moving on to start Google Health.

But as everyone knows, Google Health was a failure—and so was Bosworth’s next effort, Keas, at least until the venture-backed startup went through a dramatic pivot in 2010. How Bosworth figured out that his old approach wasn’t working, and how Keas reinvented itself as a provider of health-focused games for large employers, is the tale I want to tell you today.

It’s looking like there will be a happy ending: Keas (pronounced KEY-us) is bringing on 90,000 new users per quarter and has grown to 20 employees, thanks to continued backing from Atlas Venture in Cambridge, MA, and Ignition Partners in Bellevue, WA. But to hear Bosworth tell the story, things were touch and go for a while, and Keas didn’t really turn itself around until Bosworth stopped looking at his beautiful software code and his analytics dashboards and started listening to young psychology majors and game designers.

“Most software people don’t start by thinking about psychology,” Bosworth says. “Most software people think about features first, because they are concrete and they know how to implement them. They think, ‘I would want this, therefore my users would want this.’” But sometimes—perhaps most of the time, Bosworth argues—they’re dead wrong.

Keas CTO Adam Bosworth

Bosworth grew up in New York and graduated from Saint Ann’s, a private academy where his father, Stanley Bosworth, was the founding headmaster. He says he discovered early on that he is dyslexic, and that he learned to compensate by thinking in pictures. This gave him a talent, he says, for “basically taking Lego blocks for adults, and finding really simple ways to help people build solutions to hard problems.” Those skills enabled him to make breakthrough after breakthrough in the software world, and turned him into one of the hottest commodities in Silicon Valley—Bosworth has ducked recruiting attempts by Facebook’s Mark Zuckerberg, among others.

But it was during the Google Health project that the limitations of Bosworth’s data-centric point of view began to show through. The idea behind Google Health was to get millions of people to put their health records—medications, lab results, immunizations, chronic conditions, and the like—on the Web in a central, secure repository accessible to them and their caregivers. “The idea I had was that in order to help anyone be healthier, you would need their health data,” he says. “This was in 2006, when only 10 percent of doctors had access to electronic health records, and only 10 percent of them would share it with patients, meaning that 99 percent of people weren’t able to get their own health data electronically.”

At the same time, coincidentally, personal financial management startup Mint.com was getting off the ground. “I had in mind doing Mint.com for health,” says Bosworth. Mint had three features that Bosworth wanted to emulate: … Next Page »

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As more people turn to social networks for a video game fix, they’re also getting friendlier with the idea of forking over real cash for in-game virtual currency and items, according to a study commissioned by Seattle’s PopCap Games—the recent Electronic Arts acquisition that’s providing a lot of fuel for EA’s transition into more online and mobile games.

Digital transactions are the key to making money in social gaming, where free-to-play games are very common and revenue comes from charging for add-ons and extras that bring a player some special status, abilities, or even just decorations.

The online survey, conducted by pollster Information Solutions Group, shows two compelling statistics: First, more people are buying digital currency this year, compared with a similar survey in 2010. That measure went from 14 percent in last year’s survey to 26 percent in this year’s version, which is based on responses from roughly 1,200 social gamers in the U.S. and U.K.

If you extrapolate that response out to the broader population, Information Solutions Group says you’ve got about 31 million players buying virtual currency.

And secondly, people seem to be warming up to the idea—even if they haven’t taken the plunge in buying digital items yet. When asked how likely they were to pay for virtual items, about 46 percent said they were “very likely” or “somewhat likely” to open up their wallets. That’s up from about 32 percent of respondents in the 2010 survey.

Also significantly, the staunch holdouts who said they were “very unlikely” to pay for digital items showed a significant drop: In the 2010 survey, 47 percent of respondents showed that level of resistance. But in this year’s edition of the survey, the “very unlikely” fraction was down to 33 percent.

All the usual caveats about surveys apply, and fellow polling geeks can read the detailed methodology statement from the pollsters here. But this would generally track with what the games industry is chasing as it evolves from a fixed-production studio model into a digital-service industry with different revenue streams.

Exhibit A in that transformation is Zynga, which has rocketed from founding in 2007 to the verge of a $1 billion IPO. Zynga’s games, largely tied to Facebook, have traditionally made money by getting players to pay for little accoutrements that gussy up their game-play—so if you’re building digital barns in FarmVille, you might buy the nails and lumber to complete that project.

The lucrative potential for this revenue stream is a big reason why Facebook insisted that Zynga and other developers use its proprietary Credits system for such purchases, with Facebook getting a 30 percent cut. Facebook is now testing those credits outside the social network proper, with the GameHouse division of Seattle’s RealNetworks serving as a a key guinea pig.

This overall consumer trend shows why Redwood Shores, CA-based EA was willing to pay $750 million in cash and stock up front for PopCap (with earn-outs, the price could reach $1.3 billion). EA is a pioneer and longtime leader in traditional, hardcore console gaming, but is charging after Zynga in the digital sector, with acquisitions like PopCap providing a lot of the fuel.

When it bought PopCap, EA cited analyst figures showing that worldwide social game revenue would grow from about $2.4 billion in 2010 to $7.5 billion in 2014. PopCap’s 2010 revenue was just over $100 million, and EA recently said the unit’s sales  would grow more than 30 percent for 2011.

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We’re adding another name to the already power-packed list of speakers for Mobile Madness Northwest on Dec. 6: Cameron Myhrvold, founding partner at Ignition Partners. And speaking of Mobile Madness, you’ll want to buy your tickets now to get the best deal—the best rate expires today.

Cameron knows his way around innovation in the Northwest and beyond: After a long stint at Microsoft, where he created the developer relations group and worked with big telecoms, Cameron moved into the venture capital world with Ignition. And though he’s well known for investments in infrastructure and software, Cameron also serves on the board of Redmond, WA’s Wild Tangent.

All of those perspectives will come in handy as he helps us moderate a discussion on how mobile is transforming gaming. In case you missed the full guest list the first time around, he’ll be talking with Giordano Contestabile from PopCap Games, David Bluhm from Z2Live, and Bernie Yee from Bungie Aerospace.

And that’s just one panel—we’ve got more discussions with entrepreneurs and innovators lined up, presentations from interesting startups, and plenty of networking and mingling time to boot.

Get your tickets here for the best rate—and don’t miss the startup and student specials. We’re teaming up with with the Washington Technology Industry Association for this half-day forum, which will run from afternoon to evening on Dec. 6 at F5 Networks in Seattle.

Here are the rest of our speakers—with more additions to come:

Tom Alberg, Managing Director, Madrona Venture Group
Tom Huseby, Venture Partner, Voyager Capital
Wesley Chan, Partner, Google Ventures
Geoff Entress, Venture Partner, Voyager Capital
Bill Bryant, Venture Partner, Draper Fisher Jurvetson
Mike McSherry, CEO, Swype
Brian Fling, Founder and Creative Director, pinch/zoom
Chris DeVore, General Partner, Founder’s Co-op
T.A. McCann, Vice President, RIM (Gist)
Ted Morgan, CEO, Skyhook Wireless

Stay tuned for more news about the lineup, some previews of the issues we’ll tackle, and more details. We’ll see you there.

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Facebook is testing its virtual currency system, Facebook Credits, on sites across the broader Web—and the first public guinea pig is GameHouse, the casual-games division of RealNetworks (NASDAQ: RNWK) that is going full-bore after a bigger slice of the social-gaming sector.

Facebook Credits allow players to buy “virtual goods” within games they play. So, if you’re building barns in social-game leader Zynga’s FarmVille, you can buy some nails and boards to complete the task. And that’s turned into a sizeable business: One analyst has predicted that Facebook’s 30 percent cut of Credits sales will bring it $400 million this year from Zynga alone.

Matt Hulett

But bringing credits outside Facebook’s garden has implications well beyond a few candy-colored time-wasters. Matt Hulett, Real’s senior VP of games, says it’s a major step in building a revenue platform that developers and studios can use to tie games together, regardless of where they’re played.

With Facebook Credits enabled outside of the social network, two GameHouse games that were previously only available on social platforms—Collapse! Blast and Uno Boost—can be played on GameHouse’s website. And any purchases made or progress achieved by a player will show up when they switch platforms, between website and Facebook, or vice versa.

That’s a big deal because it helps usher in the future of casual-type games, where you might start playing one on your connected TV, switch over to your smartphone or tablet while riding the bus to work, and then continue on your work computer during the day.

Hulett says that frictionless gaming experience will help make social games even more mainstream, and potentially break down the idea that “social game” only means something that’s played on a social network (Google+ also offers games, and GameHouse is on that nascent platform too).

“I think we’re a little cro-magnon in the game space when we talk about social games as this alien thing,” Hulett says. “It’s huge, and we know its growing. But when we talk about anything other than Facebook, people shut their brains off and stop thinking.”

The arrangement also will help GameHouse in its drive to become a leading social publisher, Hulett says, because players who work within the Facebook Credits system on GameHouse’s sites will be counted as daily users of Facebook games overall. That allows GameHouse—and Facebook—to draw more players into the social network’s territory.

“For us, with 15-20 million unique users on these dot-coms, we know those same consumers are playing games on Facebook or downloading in app stores,” Hulett says.

The Facebook Credits experiment reflects just how driven GameHouse is in social games, Hulett says, and also showcases the division’s technological expertise in working on different platforms, from online to social to mobile. About half of the GameHouse division’s roughly 300 employees are now devoted to social games, and the unit turned profitable a year ago as it got out of underperforming lines of business and refocused on social games.

“I’m highly confident that we’re going to be growing in to a top-10 developer of social games very, very soon,” Hulett says.

While the company doesn’t break out virtual currency revenues as a separate item in public financial reports, Hulett says it’s the clear target for growth: “I’ve seen growth rates that say it’s going to be as big as console gaming,” which is still a roughly $20 billion annual business, Hulett says. “I think it’s going to be the main thing that we do.”

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The region that pioneered national wireless networks is at a turning point.

Carriers are heading toward more consolidation, piling up tons of user data, and scrambling to build their next-generation networks. Microsoft is battling to be the vital third competitor in mobile operating systems, while Amazon stakes out its own device and cloud services ecosystem to seize greater control of emerging consumer channels.

Woven between these major players are the innovative entrepreneurs, researchers, and investors trying to outmaneuver the Valley and build a rich seedbed for mobile software startups here in the Northwest.

There’s a lot on the line. And that means there will be plenty to talk about Dec. 6, at Xconomy’s latest big event we’re announcing: Mobile Madness Northwest, a half-day forum featuring a fantastic lineup of leading innovators who are tackling these next-wave challenges.

And we’re not alone in bringing you this afternoon of great discussion and networking: Xconomy is joining forces with the Washington Technology Industry Association for this event, adding even more top-notch speakers to the agenda. The event is being hosted by F5 Networks, at the company’s headquarters right on Elliott Bay.

Grab your tickets now to get the best rate. Here’s the lineup of confirmed speakers so far:

Tom Alberg, Managing Director, Madrona Venture Group
Tom Huseby, Venture Partner, Voyager Capital
Wesley Chan, Partner, Google Ventures
Bernie Yee, Platform Producer, Bungie Aerospace
Giordano Contestabile, Senior Director of Mobile Product and Business Strategy, PopCap Games
David Bluhm, CEO, Z2Live
Geoff Entress, Venture Partner, Voyager Capital
Bill Bryant, Venture Partner, Draper Fisher Jurvetson
Mike McSherry, CEO, Swype
Brian Fling, Founder and Creative Director, pinch/zoom
Chris DeVore, General Partner, Founder’s Co-op
T.A. McCann, Vice President, RIM (Gist)
Ted Morgan, CEO, Skyhook Wireless

We’ll have some more surprise names to add to the list as we get a little closer to the date, and some previews of the topics we plan on tackling. There will also be some demos from startups innovating in the mobile sector, and plenty of time for networking. But mark your calendars and get your tickets now for the best rate. We’ll see you Dec. 6.

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It’s a busy day for venture-funding and IPO announcements. To wit:

—San Mateo, CA-based InMobi, which runs the largest independent mobile ad network, said today that it has arranged a whopping $200 million investment from Softbank, in two tranches of $100 million each arriving this month and in April 2012. “With a global leader like Softbank behind us, we are now well positioned to fully capitalize on the opportunity before us through substantially increased product innovation, deeper market penetration, and acquisitions across the mobile ad value chain,” InMobi founder and CEO Naveen Tewari said in a statement.

—Chegg, the Santa Clara, CA-based online college textbook rental company, said that it has agreed to acquire Zinch, a San Francisco startup whose online platform matches students applying to colleges and graduate schools with admissions offices and scholarship opportunities. “”With our acquisition of Zinch, we’re extending our mission to high school students through the $7 billion college recruiting market, while continuing to break down the barriers of a college education, from the high cost of tuition and textbooks to helping students make money, pick their courses and get the academic help they need,” Chegg president and CEO Dan Rosensweig said in a statement. Zinch raised venture financing from New World Ventures as well as individual investors Mike Levinthal, Stan Chudnovsky, Aydin Senkut, and Chris Michel. Financial terms of the acquisition were not disclosed.

—GCT Semiconductor of San Jose has filed S-1 registration papers in preparation for an initial public offering. The company, a fabless designer of 4G wireless chips, hopes to raise $100 million in the offering. The filing shows that GCT’s largest shareholders are board chairman Paul H.J. Kim (31.15 percent), Parakletos Ventures (31.14 percent), and FirstMark Capital (13.60 percent).

—Alphabet Energy, a San Francisco startup developing thermoelectric materials that capture waste heat, said it has closed a $12 million round of Series A financing. TPG Biotech led the round, which was joined by existing investors Claremont Creek Ventures and the CalCEF Clean Energy Angel Fund. The company says it will use the funds to speed up product development, deploy pilot projects, and relocate to an as-yet-undisclosed location in the Bay Area. Mark Gudiksen of TPG Biotech has joined Alphabet’s board of directors.

—RRKidz, a San Francisco- and Los Angeles-based startup developing tablet-based books for children, said yesterday that has completed an initial round of fundraising with support from Raymonds Capital and the Ewing Marion Kauffman Foundation. Led by actor-director Levar Burton of Reading Rainbow and Star Trek fame, the company is creating a subscription e-book service for iPads and Android devices. In a report today, VentureWire put the amount of the initial investment at $3 million.

—Rumble Entertainment, a new cross-platform gaming company based in Redwood City, CA, came out of stealth mode to announce that it has collected an unspecified amount of seed funding from Playdom founder Rick Thompson. Rumble’s founding team includes former EA executives Greg Richardson, Mark Spenner, and David O’Connor, as well as former Zynga designer John Yoo. Rumble says it will build free-to-play games in house, and also offer a publishing platform to third-party developers.

—San Francisco-based SaveUp, which is building an online rewards program to encourage personal saving, announced that it has collected $2 million in seed funding from Blue Run Ventures and True Ventures. The startup, whose system is still in private beta testing, was founded by Priya Haji and Sammy Shreibati. “Instead of rewards that accumulate over long periods of time, SaveUp is pioneering a unique model where every positive financial action offers the chance to win valuable or life-changing prizes,” the startup said in a statement.

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Today: a dollop of new funding deals, and a dash of older news we didn’t have time to tell you about on Monday and Tuesday.

—Red Robot Labs, the Palo Alto, CA-based maker of the mobile massively multiplayer online game Life Is Crime, has closed an $8.5 million Series A funding round with support from new investors Benchmark Capital and Shasta Ventures. Seed investors Rick Thompson and Charmath Palihapitiya also participated in the round, which brings Red Robot’s total funding to $10.5 million.

—Zetta, a cloud storage provider in Sunnyvale, CA, said it has collected $9 million in Series C financing in a round led by existing investors Foundation Capital and Sigma Partners. The company has raised $31.5 million all told.

—San Francisco-based mobile analytics startup Apsalar said on its blog that it has raised $5 million in Series A funding. Thomvest Ventures, Battery Ventures, and DN Capital led the round, which was joined by seed investors 500 Startups, Mark Goines, Morado Venture Partners, Founder’s Co-op, and Seraph Group. Thomvest managing director Don Butler has joined Apsalar’s board.

—The public/private Startup America Partnership announced at the Demo conference in Santa Clara, CA, yesterday that it has opened a section of its website where startups can apply for services, advice, and capital from 25 Startup America partners. Some of the newest partners providing services are Dell, Dun & Bradstreet, FoundersCard, oDesk, and Rapleaf. Xconomy covered the launch of the Startup America Partnership earlier this year.

—Xignite, a San Mateo, CA-based startup offering a cloud-based platform delivering financial market data, said yesterday that it has raised $10 million in Series B runding. StarVest Partners and Spring Mountain Capial partner John “Launny” Steffens led the round, which was joined by previous investors Altos Ventures, Startup Ventures, and Peter Caswell. The startup said it will use the funding to expand its marketing and sales operation and built out its technology platform.

—In M&A news, Hayward, CA-based Solta Medical (NASDAQ: SLTM), a developer of medical aesthetic procedures such as skin tightening and resurfacing, announced yesterday that it has agreed to acquire Medicis Technology Corporation division of Medicis Pharmaceutical Corporation (NASDAQ: MRX) for $15 million up front and up to $20 million in additional milestone-based payments. Medicis Technology Corporation is the maker of a “waist circumference reduction” technology called Liposonix.

—Irvine, CA-based wireless chipmaker Broadcom (NASDAQ: BRCM) said earlier this week that it will acquire Santa Clara, CA-based NetLogic Micrososystems (NASDAQ: NETL) for approximately $3.7 billion. Broadcom said NetLogic’s high-performance processors, which are mainly used to speed up wireless 3G and 4G networks, would “meaningfully extend” its product line.

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Seattle casual games company Big Fish Games has added a former Amazon.com vice president as its new chief financial officer. David Stephenson replaces Michael Vernon, who left BigFish in May to join fast-growing Seattle daily-deal startup Zulily.

Stephenson worked at Amazon (NASDAQ: AMZN) for 11 years, most recently serving as vice president of finance for the $15 billion North American retail division. He also previously worked for Procter & Gamble.

Stephenson’s e-commerce experience will certainly come in handy at Big Fish, which sells thousands of casual games online. Games are either produced in-house by Big Fish’s own studio, or by other developers who market their games through the site. The company also has moved into mobile and social games in recent years.

Big Fish raised about $83 million back in 2008, and earlier this year added ubiquitous angel investor Geoff Entress to its board. Casual and social games have become a hot sector recently, with Zynga’s explosive growth and Seattle studio PopCap’s recent acquisition by EA.

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Fresh Mangoes: HTC, the handset maker with North American headquarters in Bellevue, WA, has unveiled its first phones running on Microsoft’s new “Mango” version of the Windows Phone operating system.

The phones are named the Titan and the Radar—guess which one is bigger—and gadget geeks can check out a thorough demo via Engadget, which features a hands-on video tour. The phones are headed for the overseas markets first, starting next month. Windows Phone VP Joe Belfiore was particularly excited about one feature:

Unfollow: Meanwhile, Microsoft (NASDAQ: MSFT) has been sued in federal court here in Seattle by a Michigan resident who claims the company tracks Windows Phone users’ locations through a phone’s camera software, even after consumers explicity reject sharing of that data. The lawsuit is seeking class-action status, but a judge has made no ruling on that request yet. Microsoft has declined comment to various media outlets, which is standard procedure in legal cases, especially fresh ones.

Traveling On: Expedia (NASDAQ: EXPE) chief financial officer Michael Adler plans to step down after six years minding the company’s numbers. In a news release, Expedia said senior vice president of corporate development Mark Okerstrom would take over the CFO’s job. Expedia said Adler would remain during a transition that includes completing its spin-off of Newton, MA-based TripAdvisor into a separate public company.

Game Ahoy: Bungie Aerospace, the iconic console game developer’s new mobile and social imprint, has released its first title: “Crimson Steam Pirates.” The game was developed by industry veteran Jordan Weisman’s Harebrained Schemes, and built using Moai, the mobile platform from Seattle startup Zipline Games.

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San Mateo-based social game maker Digital Chocolate said this week that it has acquired Bothell, WA-based Sandlot Games, a casual game studio known for Web and mobile titles such as Cake Mania, Super Granny, Tradewinds, and Westward. Financial details of the acquisition were not disclosed. “Sandlot has built a great reputation in casual games,” Digital Chocolate founder and CEO Trip Hawkins (an Xconomist), who also founded Electronic Arts, said in a statement. “We love their development teams and we can now expand further in Seattle.”

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6waves Lolapps—the entity formed from the July merger of San Francisco-based social game developer Lolapps and Hong Kong-based game publisher Six Waves—has raised $35 million in an offering of equity and options, according to a regulatory filing. The investors included Tokyo-based Nexon, a maker of microtransaction-based online games, and Insight Venture Partners of New York, according to a company announcement. Thanks to the new funds, “We are able to aggressively scale the company and continue our mission of offering developers the best possible publishing platform together with developing quality games through Lolapps which will combine to give consumers an unparalleled gaming experience,” Six Waves CEO Rex Ng said in the announcement.

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Kixeye, the San Francisco game studio behind the Facebook games Backyard Monster and Battle Pirates, said it has raised $18 million in a Series C financing round. Jafco Ventures was in the lead, and was joined by existing investors Trinity Ventures and Lightspeed Venture Partners. Jafco managing general partner Joe Horowitz has joined Kixeye’s board, as has Andrew Trader, a former Zynga executive now with venture firm Maveron. In a statement, Horowitz called Kixeye a “hits factory” with a “highly sophisticated monetization model.”

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