Rory brings up some good points regarding Massive's business model for dynamically served in-game advertising. There are a lot of people in the industry (both gaming and advertising) who believe this is potentially the next cash cow, but I have serious doubts. To get a better sense for what's actually going on, we have to take a deeper dive into how this all evolved...
I was at EA, when we first began to sell "hard-coded" in-game sponsorships. It was a huge challenge. Game studios had to be convinced that $50M+ titles now needed to include real-world sponsorships that often generated <$1M in revenues. Without early ad standards, advertisers and agencies often had unreasonable expectations and the user-experience "realism" was compromised. At the time, a few of us felt that this might not be a scalable business model, but agreed that driving innovation was more important. We received good press, and EA's name was front page.
Since then, a few companies such as Massive and Double Fusion have taken the next step to create the technology and network to dynamically serve in-game advertising, much like how ads are served on typical web pages today. There are obvious benefits to taking this approach over hard-coding each and every sponsorship; but we need to realize that there is a very clear line here. What was flashy and innovative (namely, driving past a hard-coded McDonald’s restaurant at 100MPH in “Need For Speed”) is being replaced by rotating in-game banner ads. Sure, dynamically served ads are scalable, but the value proposition for advertisers also changes.
I’m sure the long-term plan is to dynamically serve sponsorships, but who knows when that will happen…
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