Facebook reportedly acquires Parse for $85 million, beating out other suitors such as Yahoo and Google.

The other day I was talking to a developer friend about Parse, a company (or platform) which automates certain parts of app development and makes it easier for developers.

Now Facebook has decided to own them and reinforce the social network’s commitment to mobile by bringing it closer to developers and opening up new opportunities to build mobile ad inventory. Thanks to Chantal Tode for the heads up.

But why Parse and why is it important?

Creating compelling apps can require a lot of resources which is why backend-as-a-service companies such as Parse, StackMob, Kinvey and others exist. And are used by peeps like us involved in mobile game and app development – we love them.  Mainly as Parse et al makes it easier for us to connect mobile apps to the cloud and provide automatic functions such as data storage and connections to social networks.

As a result, developers and clever mobile marketing bods behind them are able to focus on creating features that will provide a strong user experience for brands and for people using them too.

So why would Facebook want to buy them?

Well, for a while I have been talking about the mobile strategy for Facebook, one I admire and one with many different tributaries. Personally I think Facebook is aiming to bring them all together to form one big river and become a mobile operating system – but that’s another point.

“What this purchase does, is give them more horsepower to the API side of the business, which adds stability to all the developers out there using Facebook as the platform of choice for deployment,” he says Scott Michaels, a partner at Atimi Software.

Ostensibly, mobile app developers will be able to build more, better and faster Facebook-enabled products. At the same time, Facebook is able to keep the entire app usage in its cloud so as to make sure that all of the data generated by the app adds to the value of Facebook’s social graph.

One key implication of the deal is the ability for Facebook to create new mobile advertising inventory and thereby increase its share in the quickly growing mobile ad space.

“Apps are a great way to manufacture advertising inventory, kind of the way a blog does for online,” Mr. Hayden said. So it’s a little bit like them owning WordPress before the DIY internet explosion – believe you me – that DIY on apps is already here with mobile app creation platforms like Appscend.

The question will be will it come for mobile games as well?

The other question how do you get hundreds of millions of people to consider downloading your app in the first place?

Again facebook is providing an answer with the new Facebook’s app install ads. Which it launched back in October  (click here for the app install ads article) s to let developers pay to promote their apps in the mobile news feed of Facebook’s apps.

It’s some we here at Great Marketing Works are yet to fully test out (but we are doing with clients) and have heard great reports from abroad like: Canadian ecommerce discounts app Checkout 51 who was able to pull in 10,000 installs over two days using app install ads. The cost per install came in at just $0.60. If you can think about the potential ROI from a LTV of a customer this is insane!


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