• Wall Street Journal (paid subscription required), Wednesday, April 26, 2006 10:30 AM

Massive Incorporated, an in-game ad serving company, is being acquired by Microsoft, The Wall Street Journal reported this morning. This means Microsoft plans to handle ad-serving for the XBOX 360, its next-generation video game console, on its own. It also underscores the belief of industry analysts and executives in the potential for incremental advertising revenue in video games. The Massive acquisition means Microsoft has its next-generation advertising strategy in place long before rivals Sony and Nintendo have even brought their new consoles to market. The acquisition likely means the other console makers will develop their own in-house ad-serving units as well. Microsoft plans to incorporate Massive's network into AdCenter, its brokering service for all digital ad sales; the company's long-term goal is to offer a service for advertisers that lets them buy ads across a wide-range of Microsoft products. The company plans to announce terms of the agreement next week; unnamed sources said the deal is valued at around $200 million.

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