FarmVille knocked off top slot at Facebook

FarmVille has been replaced by Phrases as the most popular application on Facebook.

FarmVille, the insanely popular game developed by Zynga, is no longer the most popular application on Facebook, according to a new report from Gamasutra. That honor now belongs to a piece of software called Phrases, which allows users to plaster photos, images, and aphorisms all over their profile pages. (A fuller report on Phases can be found over at the site Inside Facebook, if you're interested.)

Gamasutra reports that FarmVille has been the most popular application on Facebook since August of last year. Peak membership was 84 million monthly users around the globe; current membership is 53.9 million members, and dropping fast. Still, Farmville "remains the most popular social game on Facebook," Gamasutra notes, "and its daily active audience of 16 million players is still bigger than that for any other app."

The popularity of social gaming has grown in leaps and bounds in recent months. As we reported earlier this fall, upwards of 56 million Americans have played a game on Facebook or a related social network, and investment bank ThinkEquity has estimated that in-game advertisements and virtual good sales will together bring a revenue stream of $2 billion by 2012.

In a recent interview with the Monitor, Lazard Capital analyst Colin Sebastian said he expects to see even "more opportunity for social gaming, particularly since people seem to be gravitating towards games as a means to interact with their friends and acquaintances on Facebook and other platforms."

Our full report on social gaming starts here.