Joystiq reader "Pickypants" asked a great question earlier this morning in our post about Microsoft's acquisition of Massive Inc.
He asked, "how -- specifically in games -- will ads give a benefit to the end user?"
First, just to get this out of the way: we know that ads can be evil. We'll be the first to slam anyone that clumsily inserts advertisements into a game in such a way that it hurts the in-game experience. That's a given! But let's move past the issue by assuming for a moment that advertisers, developers and publishers are aware of gamer alarm over the prospect of in-game ads. These parties know that they'd be hurting their businesses if they were to bludgeon gamers with ads because the resultant backlash would dampen game sales.
Context laid, let's answer the question:
- Many beloved casual games wouldn't exist at all if it weren't for the opportunity to earn advertising money off of the traffic that these games generate for portals such as MSN.com, Yahoo.com and Shockwave.com. It's impossible to estimate how many game development jobs have been created because of the ad-supported content model, but we're certain that there are people developing creative, excellent games today who would not have ever had the opportunity to do that if it were not for money generated from advertising. Gamers benefit because more creative minds working on games equals more fun games (it also equals more crappy games, but we assume cream will rise to the top).
- If ad revenues keep developers afloat, then developers go on to create new games. How many promising projects have been cancelled because publishers cut a developer's funding? How many really creative people have left the industry after their studio went bust? More money from a wider variety of sources will support a bigger industry.
- What if Microsoft could make Xbox Live Gold free as a result of an ad-supported model? More gamers would use the leaderboards and other features that are exclusive to Xbox Live Gold, and more developers would be drawn into creating attractive and useful features for online use. It would be a self-reinforcing cycle. The in-game features that we see on Xbox Live today are somewhat half-baked, in part because developers have a hard time spending that much time and money developing features that only a small portion of the Xbox 360 audience will ever use. Leaderboards are easy. How about live ladders and tournaments? How about in-game pictochat? In short, the ad model can potentially drive gamers into connectivity. Connected, dynamic games can do way more cool stuff than static games.
- Realism can be enhanced through advertising. As Joystiq reader "Grindstone" put it, "I personally welcome in-game advertising. Not to offset costs, but to make the gaming experience more real. Obviously I wouldn't expect to see a Taco Bell sign in Oblivion, but I sure as hell wouldn't mind seeing a Subway being burned down in GTA, though."
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(Page 1) Reader Comments
Adds in those Sony MMO games such as planetside haven't really been of benefit and have been considered to have driven away a lot of players.
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Other than that - I don't know how an add would benefit a gamer sans for ads that feature dating sites, carpul-tunnel ointments, and gizmos that make the ads look that much prettier.
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If the ads help immersion, like driving a car by a Target in GTA, then great.
If the ads hurt immersion, like riding a horse by a Target in Oblivion, then no.
The tricky part comes when a company would otherwise be unable to produce a game but for the ads. Then, the question becomes whether the game is so good that it can be successful in spite of the ads which do not provide immersion, rather, solely exist to generate revenue.
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As this quote showed, advertising can go over the line into the absurd, silly, or stupid. Moreover, I think it's a very good question whether or not there's any benefits to the consumer to have such rampant advertising. (Does product placement push down costs of the game? Does it ever push down the cost of a movie ticket?)
Now, should something like Xbox Live Gold become free because of advertising, that would be a solid benefit for gamers. But do we have any evidence something like that has happened or will definitely happen? Unless there is, that's only a theoretical and shouldn't necessarily be used to say that ads benefit gamers definitely.
Finally, as for the comment about cream always rising to the top, the pessimist in me would like to point out that sewage floats too.
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As far a Xbox Live Gold going to free, ad supported content: I can only see that happening when and if Live ever gets any significant competition from Sony's Hub or Nintendo's VC. Until then, Microsoft can just sit back and pocket the additional income. In theory, I suppose they could go to a free model and use that to expand their user base.... but I don't see that happening.
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Right now, I think everyone is still thinking about ads in games based on the retail model. I buy a game for $60 and it's showing me ads, forget it! I totally understand the uproar surrounding that.
For example, if someone tried to show me a 30 sec. spot in the middle of a movie I paid for, I'd walk out and demand a refund. However, I don't mind watching a movie all day long on ad-supported broadcast tv.
But let's think about a whole new class of free games that are only ad-supported. Your post brings up all the good points about what ad-supported revenue could do for the industry. Almost every medium I can think of has benefited from ad revenue to increase content. Some of that content will be awful, some incredible but having the choice is going to be a great step for the industry. Overall, it's a win for everyone involved.
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As it has been pointed out so many times, ads belong in some games and not in others. In the future this could mean that developing a racing or sports game, for example, could be much more lucrative than a fantasy or RPG type game.
Suddenly, there are 100 racers and 1000 football games and not a single decent RPG or adventure-type game out there.
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Teenage and young adult men are currently the least likely demographic to watch television programming.
What demographic currently rules the market in videogames?
Now, I don't know about you guys, but the ad model on TV sucks. The price of advertising is based almost solely on ratings, which in turn drives the creation and approval of shows.
Let's put that in perspective. The reason Cartoon Network is showing programs that are not cartoons, is to appeal to a wider audience, raise ratings, and make more advertising money. The same reason applies to why they dub their anime--incidentally, I don't watch Cartoon Network anymore.
I could go on for a while about how this model sucks, but let me show you how this applies to why ads *in* videogames are a bad idea.
1. The product serves the Advertisement. Who is the paying customer in ad supported media? Right the advertiser. The product becomes little more than an enticement for the consumer to view the ads. "What would you doooOOOOooo...for a Klondike bar," essentially.
2. Advertisements in TV are skippable, but only if you record it and watch it later. Ads on DVDs don't make a lot of sense because they are easily skippable. Ads in games, however are recorded into that game in whatever way the developer pleases. IS there a choice to view them? Probably not if the advertiser has any say in it.
3. Ads are for the purpose of enticing consumers to buy a product. If I've already paid for a game, then ads do not belong there.
So, sure. There are good reasons to make money on advertising, but lets not kid ourselves, we are *truly* watching videogames become mainstream in this area.
--Branewalker
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Why is it better to have advertisers controlling dev money? Don't advertising companies have less interest in the games than the publishers do? Don't advertisers work with the publishers and not developers anyways?
What if the in-game ads don't generate the interest the companies want? Say the next GTA does have Subway ads, but Subway doesn't notice any increase in sales. Why would they bother funding another game?
And would Subway really allow Rockstar to blow up their store? Think of how many more rules would be made up to protect the advertiser's interests.
I'd like to hear more about exactly how this is all going to work. Just saying "some games will have ads" doesn't explain enough. I don't just want to know what and where the ads are, I want to know where the money comes from, who gets it, and how it's spent. Not an easy question to answer, I know, but I'm curious.
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Unfortunately, we'll never see that happen. Just look at movies. They're heavy with item placement advertising yet ticket prices continue to rise year after year with no relief in site.
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Man, did I call it or what? *while* I'm writing my post on how ads in games are going to try to mimic the TV model, which has alienated most people who are gamers...
--Branewalker
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hmmmmmm.........
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End of discussion.
It's like having ads placed into music you want to buy.
TV & radio is one thing. Those are passive broadcast media forms. But active media forms like gaming NEVER should have advertisements within the game.
You would have opened a Pandora's box by letting that take root. And it will eventually dry up the industry.
Support Nintendo, folks. More than ever it seems that is the only company focused on the enjoyable experience of gaming and nothing else (except profit of course). The last true game company & system maker alive.
'Net parlor gaming like Yahoo games & MSN games & such it doesn't matter. A different business model.
John Lucas
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The average consumer seriously under-estimates how much your time is worth and how much companies make from product placement .
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However, if I were running around clubbing hookers in the next gen installment of GTA and I came across a huge Starbucks that would be GREAT! It would bring me no greater satisfaction than to be able to go in a Starbucks, brought to you by in game advertising, and shoot everyone in it! (Jack Thompson disclaimer- But not in real life!)
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i love fight night as uch as the next guy but come one i don't remember seeing huge ass dodge signs while watching ali vs frazier (espn classic) games seem like
the last great place i can go with out being bugged to death about buying more shit, anyone been to a movie lately effin mc donalds commercials before the flick
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Thats 50% more than the US and we have a 17.5% tax rate.
Lest we forget that the money that companies like Coca-cola or whomever pay EA to advertise in these games comes from us the consumer. So we have to pay twice!
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These magazines sell a lifestyle, and the ads reinforce that lifestyle. If the ads in a video game reinforce the gamer lifestyle, they also add legitimacy.
It says "There are other people like you who are also willing to pay money for things like games and other products you care about" which in turn makes the user feel like something larger, like they're a part of the world.
Advertisements tie us together. They're a global constant. And hey, they give us something to talk about.
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To play devil's advocate for a moment, the very first time I saw an ad for a product within a game was back when Cruisin' USA came out (around 1995), and billboards in the game showed Kellogg's Corn Pops, with their slogan at the time, "Gotta have my Pops(tm)".
Now, in a driving game, it might make sense to have ads. But don't pretend that Nintendo is somehow above slapping advertising in games.
Moreover, I'd peg the Pokemon games as extremely likely to produce ad revenue in the future. Think of it - it takes place in a world with a decent amount of technology, so it's perfectly conceivable that they'd have some of the same type of products we do. On top of that, it's a guaranteed high-volume title, so you'd get alot of eyeballs.
Scoff all you want, but when your Pokemon is drinking Pepsi-brand Potions to recover life between battles, don't say you never saw it coming.
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Unfortunately, no media is free from advertisers.
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"Ads are only good for modern day sim games. The Sims, racing sims etc. I don't play those kind of things. I play games featuring worlds like Hyrule, Mushroom Kingon, Talon IV (is it?), Hoenn etc. Hell if I'm ever going to see an ingame ad :) w00ts."
You sound like you think you won't be affected. That's exactly the point I was trying to make in my above post. The games you like aren't inherently the games that get ads placed in them, right? So now what happens when developers choose to stop making the kind of games you most like in favor of these "sim" games because the advertising opportunities in these games is higher? Where does that leave you?
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I wanna see how shameful they get with games, i remember almost vomiting when i went to see I, Robot and Will Smith announces that hes wearing "Converse 2001 Vintage" or something like that.
I cant wait to see Solid Snake tell me about the great new price plans from T-mobile
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No sh*t, Sherlock. VC was explaining how ingame adds will help the end user by comparing the benefits of adds for free games as they exist now.
Reading Comprehension 101, dude, re-read, stop, think and if it still doesn't make sense to you, don't post a stupid comment.
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Currently, networks allocate around 16 minutes per hour for commercials - this is consistent with both cable and network television. This is on top of bumps running on the bottom of the screen (almost always for other shows on the network) which probably run for about 60-90 seconds per program and the fact that credit sequences are often minimized (making it damn near impossible to actually read them, for those of us who care) so that the other half of the screen can run additional advertising.
If you factor in the bumps and the minimized credits, I'd feel comfortable saying that a full 1/3 of television airtime is advertisements at this point (about 20 minutes per hour). Consider that even as recent as ten years ago, that number was half as large (about 10 minutes per hour).
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"Tasteless In-Game Advertising"
There will be no benefit to the the end-users from in-game ads (in traditional retail games) and anyone who tells you otherwise is either naive or stands to profit from them. Personally I have enough advertising shoved in my face already each day and I'd rather spend the $50 a year for Xbox Live Gold than have to look at animated GIF banners for Axe Body Spray while waiting for Ghost Recon to load.
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The first is money. TIVO's are becoming hugely popular and advertisers are suffering. So they've started puuling spending away from TV and into other mediums. TV advertising is US$200 Billion industry. That money is earmarked in budgets in the major advertisers and will be spent somewhere. Title sponsorships of sports events, Sports events, etc... One of those places is in-game advertising. This is important to remember because this is going to really swell up. Now can we count on Developers and Publishers to make the right decisions when corporations are literally throwing millions of dollars at them. I'm not so sure.
The next thing to consider is immersion. It is important. Walking past a Burger King will evoke a much different response from me in a Mario game than driving past in NFS. That's because it works in NFS. It makes sense. Developers and publishers know this, but will they willingly let a title die from lack of funding 50% of the way through rather than surrender their ideals.
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We all pay good money to go and see the latest summer blockbuster that is chocked fill with product placement. Can you think of one movie, in the past year, that did not feature Pepsi or Coke. When was the last movie to feature a computer or laptop that was not angled in a specific way as to display the Apple logo.
Why I will even bet that your own cars are covered with delearship logos....nothing more than ads.
I recently purchased a designer t-shirt. This was nothing more than one giant ad on the front for their brand name. This shirt cost me over $40. The thing is that I did not expect a rebate on the shirt because of this. It all comes down to my personal choice in purchasing these products.
Ads can be good in several situations.
*If the ads allow the developer to subsidize a procut or service to keep cost low or free (like they do for magazines and newspapers), then ads would be a welcomed addition.
*If the ads enhances the reality of the final product, then I support them 100%. It would be strange to see a hockey game, and not see the boards and ice covered with ads, as this is what I would expect to see in the real world when enjoying a game.
*If the ads do not interfere with the actual game itself. Maybe appear on the loading menus.
PC games have been displaying ads for a long time now. When you install the game, often you will see advertisement for other games offered by the same company. This is nothing new.
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One of the things we seem to forget is that the prices to develop games has not come down but gone up. These companies will have teams of people working to get a game ready and this cost money.
If the ads in these games helps the publishers and the developers recoup the money used to make these games then I'm all for it.
Look at companies like Majesco and there game Psychonauts. I never read or heard one bad thing about this game but it sold shit. If in game ads would have helped Majesco recoup some of those dollars they might still be developing games like Demonik and others that got cancelled.
**Keep the ads to a minimum**
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Radio has ads. TV has ads. Papers have ads. Magazines have ads. Web sites have ads. My games? Currently do not have ads.
What's next, ads on parking space lines? Oh, wait. Here it is: http://www.parkingstripe.com/
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