Zynga will bring online gambling to the masses, Pincus says

Zynga CEO Mark Pincus said the company is not trying to cash in on the existing hardcore gambling market with its foray into online gambling in the U.K. Instead, Zynga will focus on what it knows best -- making gambling games social.

This means displaying bragging rights for when you score big as well as letting your friends see when you don't.

"It makes it more exciting than when you're by yourself in an anonymous poker room," Pincus said during a Morgan Stanley conference in San Francisco today. He wouldn't say when the company would launch into real-money gambling, but in the past the company has said it would start within the first half of this year.

Instead of aiming for serious gamblers, Pincus said Zynga wants to introduce real-money gaming to a mass market in the same way it introduced social gaming to the general public.

"We're not the company to win the hardcore real-money gamers," he said. "But we think we are for the mass market audience."

Zynga started stirring the real-money gambling pot last year when it announced a deal with the U.K.-based poker company Bwin.Party Digital Entertainment to offer online poker and casino games for cash in the U.K. It thenmade efforts to apply for a gambling operator's license in Nevada, spurring Wall Street to wonder if the struggling company could pick itself up with gambling dollars.

Pincus has been working to restructure Zynga by reducing expenses and shoveling resources to the company's more profitable endeavors. In the process, its workforce has been shrinking, through layoffs and fleeing executives. Just today, Zynga lost some employees when it closed down its Baltimore office and consolidated offices in Texas and New York.

Despite the company's turmoils, Zynga's Zynga's stock picked up recently, notably after Nevada became the first state to allow online gambling last week.

Sticking to what it knows has become Zynga's mantra very quickly. After seeing a dropoff in players in some of its most popular franchises, Zynga started making more sequels and fewer new games. Pincus said the strategy only worked when the creators stuck to the original themes of the game.

He pointed to the FarmVille and CityVille franchises as examples. While CityVille 2 failed -- the company pulled the plug on it earlier this month due to its poor performance -- FarmVille 2 is a success.

Pincus said FarmVille 2 stuck to the main themes of the game -- planting and harvesting crops -- but added new technology that allowed for a 3D experience and crafting. For CityVille 2, the creators took a completely direction, with a new storyline and features.

"The lesson to us is we can invest more confidently in our franchises, but only when we stay true to the original formula," he said.