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Facebook virtual currency now real

USA Today reports that Facebook Credits will be available as gift cards at Target.

The new Facebook gift cards will be available in values of $15, $25 and $50 at all of Target’s 1,750 retail stores and at Target.com. Two or three more national retailers will start selling the cards in coming months.

The article goes on to report that cards for online games such as Farmville are already available and that the overall market for gift cards was $80.6 billion last year.

I wonder how the gift card economy works. Does facebook get to book revenues for gift card sales before they are re-deemed? How are gift card sales classified for taxes? If you sell gift cards in other currencies, does the gift card revenue get counted towards the US GDP?

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Ian Kennedy

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2 responses to “Facebook virtual currency now real”

  1. Tweets that mention Facebook virtual currency now real -- Topsy.com Avatar
    Tweets that mention Facebook virtual currency now real — Topsy.com

    […] This post was mentioned on Twitter by ian kennedy, test account. test account said: iankennedy: Facebook virtual currency now real http://goo.gl/fb/YsIeD […]

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  2. Scott Schnaars Avatar
    Scott Schnaars

    Gift cards are kind of a nightmare.

    Retailers, who are paid when they sell the card but still owe the equivalent dollar value to their customers, can’t recognize revenue at the time of sale, observed the AP; they must carry a liability on their balance sheets until the cards’ status changes.

    Just when is that? At a recent accounting conference, noted the wire service, Securities and Exchange Commission accounting fellow Pamela Schlosser gave these guidelines: when the cards are redeemed or expire, when redemption becomes remote, or when the company can “reasonably and objectively” estimate what percentage of its card sales will go unredeemed. Hardly a hard-and-fast rule.

    http://www.cfo.com/article.cfm/5375971/c_5354851

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