Imagine a virtual world in which your 12th-level warrior pops into a McDonalds for a quick bite to eat, dons an Armani Cloak of Sophistication, or stumbles across a Wusthof Blade of Dicing (+8). Such scenarios are increasingly likely as the gaming industry joins forces with advertisers to create new marketing opportunities and much-needed revenue streams.
Last Friday, Google entered the fray by announcing on its official blog that it had acquired Adscape, a small San Francisco-based company that specializes in creating in-game advertisements. The post was written by Adscape exec Bernie Stolar, a former president of Sega America and Sega Entertainment, who has now joined Google as the so-called "Dean of Games."
In a separate press release posted on the Google site, the companies said that "the deal is officially closed," but added that the terms of the acquisition are confidential. Along with Stolar, the other members of the Adscape team have also joined Google.
Vibrant Market
Stolar said that in-game advertising is necessary to help support the development and operation of today's sophisticated games.
Back in the 80s, the cost of producing a single game was about $100K. Today it can cost $25M to produce a game. The good news is there are some very passionate gamers out there that have come up with some interesting new ways to introduce nonintrusive and targeted advertising in order to make gaming accessible and affordable for all.
Research suggests that the gameplayers don't mind advertisements that are woven into gameplay. Only a third of online households objected to in-game advertisement, compared with 85 percent that objected to pop-up ads.
In-game advertisements reach a wide demographic: While the bulk of gameplayers are obviously younger (18 to 24), nearly 50 percent of online consumers over 30 also play online games.
Chasing Microsoft
Although one of the leaders in online advertising, Google finds itself in the uncomfortable position of chasing rival Microsoft. Last May, the software giant spent nearly $200 million to purchase Massive, Inc., the acknowledged market leader in in-game advertising. That purchase, combined with Microsoft's own popular Xbox 360 and numerous game titles, gives the company a significant lead in this emerging market.
The announcement by Google comes on the heels of the announcement by Sony Entertainment Group that it is rolling out its own virtual world for the PlayStation 3, dubbed "Home." The new online world will enable Sony not only to advertise its own products and those of business partners, but also sell Sony-approved content for viewing and listening on virtual Home devices.
Last Friday, Google entered the fray by announcing on its official blog that it had acquired Adscape, a small San Francisco-based company that specializes in creating in-game advertisements. The post was written by Adscape exec Bernie Stolar, a former president of Sega America and Sega Entertainment, who has now joined Google as the so-called "Dean of Games."
In a separate press release posted on the Google site, the companies said that "the deal is officially closed," but added that the terms of the acquisition are confidential. Along with Stolar, the other members of the Adscape team have also joined Google.
Vibrant Market
Stolar said that in-game advertising is necessary to help support the development and operation of today's sophisticated games.
Back in the 80s, the cost of producing a single game was about $100K. Today it can cost $25M to produce a game. The good news is there are some very passionate gamers out there that have come up with some interesting new ways to introduce nonintrusive and targeted advertising in order to make gaming accessible and affordable for all.
Research suggests that the gameplayers don't mind advertisements that are woven into gameplay. Only a third of online households objected to in-game advertisement, compared with 85 percent that objected to pop-up ads.
In-game advertisements reach a wide demographic: While the bulk of gameplayers are obviously younger (18 to 24), nearly 50 percent of online consumers over 30 also play online games.
Chasing Microsoft
Although one of the leaders in online advertising, Google finds itself in the uncomfortable position of chasing rival Microsoft. Last May, the software giant spent nearly $200 million to purchase Massive, Inc., the acknowledged market leader in in-game advertising. That purchase, combined with Microsoft's own popular Xbox 360 and numerous game titles, gives the company a significant lead in this emerging market.
The announcement by Google comes on the heels of the announcement by Sony Entertainment Group that it is rolling out its own virtual world for the PlayStation 3, dubbed "Home." The new online world will enable Sony not only to advertise its own products and those of business partners, but also sell Sony-approved content for viewing and listening on virtual Home devices.
Labels: advertising, Games, Google, Microsoft
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