Facebook has announced that its Gift Shop will closing down from 1 August in order to "focus instead on improving other products". Gifts that have already been sent will still remain on your wall but the company has decided to pass the functionality on to third party applications - such as the Hallmark Social Calendar.
Gifts were first launched back in 2007, for just $1 each with personalised greeting to the recipient. Designed by the excellent Susan Kare, noted graphical designer of the original Macintosh icon set, these gifts were commonplace in the early days of the site but have noticeably passed out of most news feeds as trends have changed.
Initially, Gifts looked like an important part of the revenue stream of the early Facebook. But the relatively high price meant that many people shied away from them, and they didn't make sense in hugely popular games such as Farmville - which tried to create its own in-game payment system, but eventually had to capitulate to Facebook, under severe pressure, and signed a five-year deal to use the new Facebook credits scheme, among others.
The introduction of Facebook Credits - from which Facebook itself takes 30% of any transaction - is an example of how the company is moving the social network into an open platform and less of a controlled site.
Credits are also much more granular than Gifts - $5 buys you 50 Credits. Creating a virtual market economy is important to ensure the long term survival of the site, as well as keeping the doors open to new third party features. The demand for virtual goods will only increase with the ever-growing number of users on the site, with the site hoping to reach 1 billion users in the future - though it's only on about 500m presently.
