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Video Game Spending 'A Blip' In Overall Ad Pie

  • Reuters, Monday, December 8, 2008 12:01 PM
For years, advertising industry experts have been saying that video games would one day emerge as a major ad medium. In a new report, Reuters notes that not only is that day yet to come, but it may still be far off. Executives speaking at the Reuters Media Summit last week noted that while the tough economy will force advertisers to seek out new ways to reach consumers, video game spending is unlikely to amount to more than "a blip" in the $150 billion American advertising industry.

"In the next six to 12 months as we go through this economic period, (advertising) probably won't have a big material impact on us or on the industry, frankly," said Shane Kim, vice president of strategy and business development for Microsoft Corp.'s gaming business. Reuters estimates that in-game advertising will grow from just over $100 million this year to around $1 billion by 2011.

One of the problems, notes Strauss Zelnick, executive chairman of "Grand Theft Auto" maker Take-Two Interactive Inc., is that recognizing an ad in a game is distracting to gamers. Advertising that truly captures their attention takes away from the entertainment experience, he said. "I have been saying ever since we took over Take Two that I thought in-game advertising was a very limited opportunity that applied mostly to the sports business, and I remain of that belief," Zelnick said. "It's a detail. It exists, it can be profitable, we'd be happy to have it. It's just not going to move the dial."

Read the whole story at Reuters »

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