Will Facebook Subscriptions Help App Developers CASH IN?

Facebook (NASDAQ:FB) announced its plan on Tuesday to begin allowing app developers to charge users for subscriptions, though the move would require them to stop using Facebook Credits for in-app purchases, and start using real dollars, according to a blog post.

Investing Insights: Wall Street Brief: Procter and Gamble WARNS, Apple’s Legal HAIL MARY, RIM Let’s Heads ROLL.

Until now, developers of apps on Facebook’s platform have only made money when users bought virtual goods, either using a currency unique to the app or using Facebook credits. Facebook does not currently support the subscription model, but by the end of the year, that will change.

Facebook said real currency will be accepted for subscriptions, and in-app payments will have to rely on in-app currencies. Credits, Facebook explains, were launched at a time when few apps had their own ersatz currencies. Now that many do, there’s less need for a “platform-wide virtual currency,” the blog post said.

Facebook’s announcement emphasized benefits for developers, including the ability to “price the same item differently on a market-by-market basis.”

“We anticipate that features built on local currency, like subscriptions and multiple currency price points, will also help developers monetize more effectively,” the company said in its materials for developers.

Some developers, including Kixeye and Zynga (NASDAQ:ZNGA), are already trying out the new model in a private beta test.

Don’t Miss: Will Facebook’s New Ads Succeed or Fail?

More from The Cheat Sheet