This article is more than 1 year old

Massive game advertising startup to aid desperate brands

Product placement in computer and console games

Right now Massive software is only licensed to work with online platforms. It doesn't require that the games themselves are designed to be online, just that the platforms are, but that lets out the Nintendo Game Cube, which doesn't yet have an online version of the device. And so far Massive hasn't yet signed a deal with Sony to work along with Playstation games.

"We have the software to work with PlayStation, it's tested and it works, but commercial terms have not been agreed," says Hays and that's virtually all she'll say about Sony. Clearly a relationship with Sony is important. The Massive contract stops games publishers from agreeing to introduce any other network advertising software into their games, so while the big publishers may not yet be able to make money on their Sony games, they can't go offering that advertising inventory anywhere else right now either. This means that the 48 per cent of the market that Massive says it has tied up, really is tied up. It can't benefit from all that marketplace until it has an agreement with Sony, but then again neither can anyone else.

We can imagine that the publishers are putting pressure on Sony to jump on the Massive bandwagon at the earliest opportunity. However Sony, being the largest games publisher in the world, expected to ship about 295m games this year, may insist on building its own advertising network, and this would split the market. That would leave those that have signed with Massive out on a limb, unable to use their upcoming Sony launches in either network, having signed with Massive, but being dependent on Sony for permission, since it has contractual control over most of its games.

Such a rift in the market would only set back the advertising industry for in game advertising. What media buyer wants to buy twice from two different organisations when planning a campaign to launch a new product or promotion?

And games publishers could really do with this extra revenue, particularly important at the current stage of the cycle in the games business, with games platforms about to be replaced. Right now consumers are reluctant to buy games platforms, but also reluctant to buy games that may only have a short life before a new platform makes them obsolete.

Hays says, "This is about $500,000 to $1m of extra new revenue per game for most games. And as far as the games publisher is concerned, it's free money."

And it opens up advertising markets that were completely unavailable to in-game advertising before. Films, for instance, are a huge potential vertical, but because they need to change their creative materials in real time, so far they could not use in-game advertising at all because of the delay in bringing games to market and the length of time they stayed there.

So does Massive have a huge list of technology and business model patents from this business to try to stop competitors entering it? According to Hays, Massive doesn't need them. "Once publishers get used to that cash flow from advertising, they are going to find it hard to live without it. Let's say they are at the end of a three year deal with us and considering signing with us or a new competitor.

"If they are launching a game in the dying days of our deal and they have to finalize production, they would be breaking the terms of their contract to introduce competing technology. What they have to do is either delay the introduction of the game - which is lost revenue - or issue it with our software in it. That means they would get a few days or weeks of advertising revenue and then their new game would have to run for the rest of its life without an advertising component."

And this will also be true of all of the publisher's old existing games. "Our reach projections are critical and we have been very conservative with them," says Hays. "Our reach calculations are based on the title's sales and then a percentage of these which are online and a calculation of how many playing hours that games will generate for that first month. We anticipate that each game will churn after 4 months."

Effectively Massive reckons it has 4 to 5 months of advertising inventory to sell before people stop playing the game in large numbers.

The truth is very different from this. "We will continue to serve adverts to the games whenever they are played," confirmed Hays, which means that the past three year's of games, where they have a residual amount of continued play, will also produce revenue (often there is a kind of sentimental nostalgia among gamers who go back to their old favourite games for a week or so).

So Massive is not claiming that old games will give it extended reach when they are played, not as far as it effectiveness calculations or revenue projections go. But they will.

And any publisher that cancels a deal with Massive must be prepared to lose that 'old' revenue, which Faultline is confident will be considerable.

Another key element of the Massive technology is that any given publisher can select not to take either a particular advertiser or those adverts with a mature rating or can request that it only has one type of advertising such as sports advertising, or can ban a particular group such as alcohol advertising.

Likewise an advertiser can decide on his adverts' 'reach' by targeting particular games or games genres.

This can also be done against game buyer demographics, but these are notoriously unreliable. Demographics at present come from cards filled in when the games are bought. Parents don't yet consider that when they fill their own names and address and age on a form, they are pre-selecting the type of adverts that their children will see. Put down the fact that you are a 43 year old man, and your young daughter might, in the future, get pornography advertising or put down you are a 39 year old woman, and your 13 year old son is bemused to find he has panty liner advertising all over his racing game.

Massive has tried to fix this by offering an optional registration at the beginning of each game, to establish the demographics of the actual player, rather than the game purchaser. This registration data is jointly owned by Massive and the game author, but gamers aren't wild about filling in forms, and Hays acknowledges that there's little that can be done about this right now and that advertisers are best focusing on the family demographics - where the family lives, and other evidence of its income (which might come from web advertising databases etc...) rather than targeting individual players.

But this is not any worse than TV viewer demographics, which can only be discovered by interview, or by technical means, such as local People Meters, and then only 'after' they have viewed a particular night's viewing, not before.

Right now this whole service is constrained by the number of gamers who have an online device. "Most PCs are attached to the internet, and a high percentage attached to a broadband line, but only 12 per cent of consoles are reported as being online. Next year that figure is going to go up to 25 per cent," says Hays, and she rightly expects her revenue to double as the online gamers audience doubles.

Part of this has been due to the fact that both Sony and Microsoft have charged separately for the online adaptors which are needed to plug into a broadband line. Sony's new PlayStation 2 now comes with an online adapter built into it and it is reasonable to expect that all future games platforms will come with such an adaptor. It still doesn't mean that anyone has plugged their broadband modem into the games platform.

If a home has a wired broadband line (as opposed to a wireless router) then it is more likely to be plugged into a home PC than into an Xbox (or PlayStation). What happens if the console is not online?

If it was recently online the advertising may still show, but there isn't a reporting path back to the Massive servers to say which adverts have been viewed. If it's been offline for a while then the game authors set their own defaults, either fake, humorous adverts or blank walls. And that means no revenue for either them or for Massive and less advertising inventory to sell.

We would expect games authors to deliberately place online elements into their games, such as online cheat lookups from in-game, to encourage connection, in order that they make their fair share of advertising dollars.

Next page: How it works

More about


Send us news

Other stories you might like