Yes and no. Gamers can be a surly sort, quick to band together for a common cause against a shared enemy. But it's really not that difficult to know how to avoid conflict. A key concept here is one that really should prevail for all media channels: The best advertising is perceived by a consumer as content. The "rocket science" for gaming ads involves maximizing ROI, targeting the buy, and leveraging the in-game elements into a larger integrated campaign. Avoiding a riot shouldn't be rocket science, and here are a few tips to help avoid such a scenario.
Get out the scale. When planning what seems like a brilliant idea for advertising, before jumping in the water, get a balancing scale. On one side, put all the things you're going to be taking away from the user. This includes 10 seconds of playtime, screen real estate (in the case of ad overlays), and even aesthetics (ugly ads can stand out in a beautiful game environment). Ok, now put all the things you're giving the gamer on the other side of the scale. This would be things like free playtime, additional content, and even highly relevant ads around anticipated product launches. If the "con" side of the scale is heavier, the plan needs to be retweaked. And remember that different pros and cons vary in "weight."
Ask permission. Most people don't like being forced to do something. Gamers especially feel this way. When subsidizing free-to-play games, gamers have an understood value exchange where they temporarily allow ads to be forced on them. But when gamers have to pay for a title, especially if new "value" is limited to the ad content itself, it's polite to ask permission. The entire "Wipeout HD" issue could have been avoided by putting in an initial branded display ad that had "press triangle to watch more video about this." If the product is relevant, gamers will be willing to sit through a 30-second spot, or even a minute and a half trailer for a film. But the key is that the engagement needs to be on their terms. Besides, a CPM/CPC hybrid model would have offered better metrics for future optimization of creative, and more impressive numbers to provide the client.
Think "content," not "ad." The concept of an "ad" leaves a bad taste in many gamers' mouths. Consider ads as "in-house branded content" instead. Got a great product that gamers are already excited about? Awesome -- more information about that product in a neatly produced package will be compelling content. Selling a softer toilet paper? Maybe repurposing the broadcast 30-second spot isn't such a good idea. Getting one of the many popular indie content producers to make an ad specific to gamers for a fraction of a broadcast ad's cost? That's the sort of thinking that could really pay off. Unfortunately budgets won't always allow for that, but in such cases, it might be good to take a step back and reevaluate if gaming is actually the right context for the product.
As much as gamers can be riled up when they don't like something, when their reaction is positive, they can be outspoken influencers. If they hate you, they track down your email and start a mass flooding of negative comments. If they like you, they buy virtual versions of your goods to wear around and talk about your brand to their social web. It's a thin line, but generally good manners will go a long way in this space.
I think you're spot on. I'd add another bullet:
Give Gamers An Ad-Free Choice.
At some level the developer has an expected ad-revenue per customer over their lifetime in the product. Let's say that you expect that for any given customer, your ads are going to make you $5 a month. An easy way to keep customers happy is to give them a choice to pay $4.99 a month for an ad-free version of the game.
Also, on your point about "pulling out the scale" - the typical problem here is one of agency. There is inevitably a Marketing / Sales dept pushing on one end of that scale and a Product dept pushing on the other end. It's also difficult on which variable to weigh.
In the case of our product, even though we're free-to-play we had long and intense discussions about how to not annoy the user with our ads. We boiled things down to "the ad-to-gametime ratio" which is basically how much time the user spends viewing ads versus playing the game. We then tested various ratios with our demographic to figure out how we could keep the game free but not overwhelm the user with ads.
After much discussion we also made a conscious decision to remove ads from pages that might be heavily visited if they also contained a lot of data (e.g. a leaderboard, box score or lobby) because the space occupied by a tower forced us to make font sizes unreadable.
At the end of it all, I agree that if you follow some basic rules you can not only have ads in your product, you can actually make the experience an overall positive (or at the very least a neutral) for the customer.
Aatish Salvi, V.P. Product Development, Quick Hit, Inc.