The move is a great one for smaller developers of casual games, who often have trouble getting their titles monetized, and face other issues like rampant copycatting in the rapidly developing casual game space. Plus, the two-tiered system is designed to encourage the development of longer-form, more in-depth content (More Bookworm: Adventures, less Cheney's Fury), meaning that advertisers looking to get into in-game advertising, without making the plunge into integrated placements, will have more inventory to buy from.
The move is part of Microsoft's continuing search to find the best monetization model for the casual games space--a search that Microsoft's major competitor, Google, is apparently also pursuing with its rumored purchase of AdScape, an in-game ad company. Although AdScape touts its Real World/Virtual World Gateway tech, an industry insider said that the real thrust of the Google/Adscape deal, when it comes through, will be a monetization scheme for casual games.
More so than in-game product integrations, ads in casual games fit the model offered by the Web -- trackable, accountable, and easily bought and sold -- and initiatives like those being pursued by MSN and Google are good news for advertisers looking to get in front of young, Web-savvy consumers.