Advertising has so saturated every facet of American life that it’s starting to lose potency—sort of like crack. And just like crack, long-term ad viewers need higher doses of the drug to achieve that elusive high. That’s the appeal (to advertisers, at least) of in-game advertising: it’s new, it’s fresh, and it just might make an impression on jaded eyeballs. In short, video game advertising has gone mainstream, and if you want proof, just follow the money.
Microsoft dropped a bundle to acquire market leader Massive a few months back, and now Intel has gone and purchased a piece of the advertising pie. The company recently invested a few million bucks in IGA, a firm that recently named Chris Deering, former president of Sony Entertainment Europe, to its board of directors. IGA now has partnerships with some of the largest tech firms in the market, industry insiders on the board, and US$17 million from a Series A round of venture capital funding.
Though the company is still not a household name, they’ve been mentioned before on Ars. At the beginning of this year, they were players in the dust-up over Subway ads in Counter-strike games, something that really steamed Valve (dreadful pun quite definitely intended), the game’s creator.
The intriguing thing about in-game advertising is that gamers don’t seem to mind. Though television viewers long ago found ways to avoid the siren song of commerce (the VCR, the mute button, TiVo), gamers often welcome the arrival of “name brands” in their digital worlds. What’s odd about this is that it seems to offer so little value to the customer. Consider the following statement from Intel’s Damien Callaghan, Strategic Investment Manager at Intel Capital. “The explosive growth of digital gaming is attracting millions of new users and is a key element of Intel’s vision for the Digital Home,” he said “IGA’s products enhance this opportunity by enabling game developers and publishers to earn additional revenue ensuring the continuation of a vibrant industry—an issue of importance to Intel and its customers.”
Note who’s left out of the equation: consumers. Basically, the gaming industry wants users to buy their products at retail and then watch constantly updated in-game ads. Unlike the TV model, which offers consumers a compelling free product in return for the advertising, the gaming industry offers nothing, not even a discount (though one could argue that games would be even more expensive without this extra revenue; whether this is true or not is a question for another day). Perhaps when the novelty of the practice wears off, gamers will be less tolerant of having their attention sold to advertisers. Or perhaps not; big-name ads lend a certain legitimacy to gaming that players seem to enjoy, which is good news to companies like IGA and to financial backers like Intel.