Microsoft is reportedly operating on a program that will allow brands to showcase advertisements within free-to-play Xbox games. For instance, the ads wouldn’t disrupt gameplay and may appear on a billboard in a racing game.
It’s not instantly obvious how else Microsoft plans to implement ads, such as showing them as avatar skins or videos inside game lobbies.
However, Microsoft is reportedly concerned that the ads could “irritate” players and plans to build a “private marketplace” to allow only select brands into the program.
Microsoft doesn’t intend to cut ad revenue and instead allows the game developer and advertising company to share the funds. Microsoft may want to use this to attract more developers of free-to-play games to the forum, as this would spread up another stream of revenue beyond microtransactions.
Microsoft won’t use the data it contains from Bing and other services for targeted ads on Xbox. The outlet also doesn’t understand whether Microsoft has sailed the idea to advertisers yet, but its sources claim ads will begin appearing on Xbox as soon as the third quarter of this year.
“We are always scrutinizing ways to improve players’ and developers’ experience, but we don’t have anything further to share,” a Microsoft spokesperson said. Microsoft with a request for comment, but the company said it didn’t have any additional information to share beyond its statement to Insider.
In-game advertisements on console games aren’t a new concept — game companies experimented with them in paid tournaments in the mid to late 2000s. Around this term, EA Games partnered with the Microsoft-owned advertising firm Massive, allowing companies to place ads in Skate, NHL, Madden NFL, and NASCAR franchises and Burnout Paradise. If you played any of these games at the time, you might remember seeing digital Obama ads plastered in digital sporting arenas or on billboards. Saints Row 2 even had real-life ads on billboards, like this one for Netflix.
In-game ads for real-life products might have been a novelty back in the day. Still, with some next-gen games costing close to $70, players expect an ad-free experience — this is likely why Microsoft is reportedly rolling out the initiative for free-to-play games only. EA attempted to slip an unskippable, full-screen commercial into UFC 4 in 2020. However, fans who paid for the $60 game weren’t happy, resulting in EA pulling the ad.
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