The  Avatarlabs App Factory (Rhinoball, Terminate Me, Cloudy Shake, Monsters Vs. Aliens and Poo Log) on January 5th unveiled RHYTHM RACER™ - a FREE racing game for the iPhone and iPod Touch that combines elements of “F-Zero” and “Guitar Hero” for the fastest full 3D racing experience on the iPhone or iPod Touch, and an amazing musical experience too!    The AvatarLabs team looks forward to rolling out new content, developing gameplay further, and building community via  mobile social network Open Feint (included with the game). Features:  *Adrenalin-fueled racing combined with killer interactive music!*    *Global Leader Board - see how you fare against everyone via Open Feint.*    *Facebook Leaderboard - see how you fare against your friends.*    *Includes one racing track with the ability to purchase more tracks using in-app payment for $0.99.* Coming Soon:  More Music.  More Levels.  More customizable Playing Experience. Over TEN THOUSAND satisfied customers have downloaded the free game in the first six days in the App Store.  Download and play the game here!  UPDATE: Over 100,000 downloads in first two weeks after launch on January 3, 2010!

Hundreds of millions of real dollars are flowing in and out of virtual economies, creating fun ways for people to interact via social games.  Some of those millions having been flowing into the pockets of the unscrupulous, putting legitimate companies and advertisers at a disadvantage .  We attended the Virtual Goods Summit in San Francisco and enjoyed immensely the panel discussions and conversations about this exciting and rapidly growing sector of the social web.  Being pioneers in the creation of engaging games and activities as part of larger marketing efforts, it's exciting to watch this industry mature, albeit not without some growing pains.  Overshadowing some of the innovations and success stories presented at VGS at the end of October, have been the ongoing "ScamVille" posts on Tech Crunch that lead to the replacement of a founder/CEO at her own company, and possibly to class action lawsuits against big players like Zynga, and even Facebook.  Hopefully the outcome will be a high-quality channel for advertisers to find and engage consumers, and for those consumers to be able to play safely.  This may happen quickly if all the players in the space follow the lead of new Offerpal CEO George Garrick who has moved quickly to admit wrong-doing and implement a quality rating system for advertisers.  Read the whole thread on Tech Crunch here.  Whether or not you agree with Michael Arrington's approach to journalism, it is entertaining reading.

Everyone is talking about the strength of Facebook's new mobile offering. There's even some talk of it being a Twittter killer! We're looking forward to using it and figuring out cool ways to integrate the functionality into the right campaign. Read more at Tech Crunch here, or MediaPost here.

There is certainly some bias in the statements of Fred Wilson as he talks about Twitter, but the numbers are compelling: Twitter is taking a bite out of Google's share as the Web’s biggest “source of traffic”. Our experiences with Twitter as a part of larger campaigns definitely show added value in this regard. Read more of the Tech Crunch article here.