Facebook Credits Now In Beta Testing

Over the weekend Facebook rolled out a beta test version of its Facebook Credits virtual currency system. Currently Facebook Credits are available only to users on 15 select college networks within Facebook, within Facebook's own corporate network, and within the VentureBeat company network. Users can gift Facebook Credits to other users, use them to purchase virtual gifts, or spend real money to obtain more from Facebook. Users in the beta test can give Credits to those not currently in the beta network, essentially inviting them into the test. At the current exchange rate, $1 is worth 100 Facebook Credits and new credits may only be purchased with credit cards.

Perhaps most intriguing is that Facebook is pushing the Credits system not primarily as a virtual currency system (which it is), but as a tool users can use to encourage friends to post more content they like. In the beta version of Facebook Credits, a credits tab appears below any item that appears in a user's feed. With that tab, a user can give any amount of Credits to the friend who created that item in order to show how much it was appreciated. The idea is that when users get lots of credits for certain types of posts, they'll create more content in that vein so they can obtain more.

Facebook Credits grew out of the division of Facebook responsible for the site's virtual gifts store according to Facebook manager Jared Morganstern. Right now the gift store for beta users has shifted prices so that most items are 100 credits, some are 200 credits or more, and only certain brand-sponsored gifts are free. The idea of the Facebook virtual currency is to make something that does not function, socially, in quite the same role as in-game virtual currency or even the types of virtual currency seen previously in other social networks and virtual worlds. Other users, for example, cannot see how many Credits others have. Individuals can't even see their own Credits balance until they're trying to give Credits or spend at Facebook Gifts.

The currency-as-gift system Credits is playing with also has the advantage of letting Facebook use it to gather data about what types of content users like. The new version of the Facebook page has a "highlights" section and it's obvious posts that received lots of credits are probably destined to appear there. It also seems likely that it could be used to identify particularly influential Facebook users for marketing purposes.

Right now Morganstern is telling the press that Facebook Credits will only be rolled out as a general-use feature if Facebook likes the results of the beta. There is no word yet on how Facebook Credits might be incorporated into third-party apps or a potential in-house payments system for Facebook. It's also a little bit unclear why Facebook took this curious approach to its virtual currency, having it serve as a sort of invisible reputation score, rather than simply using it to simplify the process of purchasing virtual gifts. While interesting, the current version of Facebook Credits is not exactly a page taken out of the TenCent playbook and probably not what people were imagining when the LA Times first revealed that a Facebook virtual currency system was in development.

Right now Facebook only stands to profit from the Credits system if it really takes off as a way to express positive feelings toward friend content. Even then, it seems strange that there are relatively few ways for users to buy Credits and little for users to do if with Credits they've amassed. Right now Facebook doesn't allow users to "cash out" Credits for real money, so if a user does get a lot of Credits, all that can really be done with them is to give them to friends or to use them to buy virtual gifts for friends. The currency is, quite literally, social.

Will users really be willing to give each other credits, essentially worth a penny apiece, in return for status updates, wall posts, links, and photos? While Facebook is obviously looking to figure this out from the beta tests, there's no guarantee the feature would behave the same way in beta that it would as an established part of Facebook. Right now people who get Credits for content get invited into the beta that way, which makes the Credits exclusive. It remains to be seen if Credits would still be viewed as valuable once, essentially, everyone can have all they want.

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