Microsoft to Shut Down In-Game Ad Unit
If there’s one thing that most gamers really don’t appreciate, its constant in-game advertising. I mean, sure, it’s okay for sports and racing games to be littered with advertisements throughout; that’s commonplace, even in real life. But as development costs have risen and the proliferation of AAA titles increased over the years, developers are becoming more reliant on in-game advertising as a source of revenue.
A report issued in AdWeek today cites sources within Microsoft have confirmed that Massive Inc., an advertising firm specializing in in-game marketing and Microsoft property, will be shut down before the end of the month. The reasons for the firm closure have not been specified, although Joystiq reports that Microsoft wants to focus on advertising on the Xbox dashboard, since the company would then receive all the ad revenue, while Massive normally would divide revenue with the publishers. It was also reported by AdWeek that larger publishers such as Electronic Arts were looking to develop advertising in-house, thus stripping AdWeek of some of their larger clients.
Microsoft originally bought Massive way back in 2006 for an estimated $200 million to $400 million during the height of this whole in-game advertising craze. While we’re sure Microsoft and Massive worked hard to make this deal work for all parties involved, I’m kind of torn about this news; as obtrusive as I find in-game advertising sometimes, I also understand that it’s a way to keep development costs in control. As the industry expands and gets larger every year, we may be seeing more and more ads in games as publishers manage their advertising teams in-house. So when you eventually see Master Chief enjoying himself a delicious Subway sandwich, remember, studios must investigate all revenue streams possible, a necessary but unfortunate evil for us to continue playing in the future.