The whole kerfuffle appears to have been touched off by a single post on a message board, ShackNews, regarding a video game news podcast. The hosts of the podcast mentioned the fact that advertising technology in EA's "Battlefield 2142" collects IP addresses and other anonymous information to serve the ads--and the poster, who goes by the handle "EvilDolemite," expanded this to mean that the software records "surfing habits (probably via cookie scans), and other 'computing habits' in order to report this information back to ad companies and ad servers, which generates in-game ads."
But IGA's software doesn't do that. The other anonymous information it collects has to do with ad impression recording--checking to see for how long and at what angle a user viewed an in-game ad, so advertisers can be accurately billed.
It's not clear where the poster got the information that the software collects targeting information from cookie scans--something IGA Worldwide patently denies, and which was not stated in the disclaimer that came with the game, nor was it suggested in the podcast. The poster was fact-checked fairly quickly, and an hour later, he was writing that he "could have sworn" the podcast mentioned IGA monitoring browsing habits. But the damage was already done. His post touched off hundreds of comments on ShackNews, and posts on several influential tech and game sites, including Kotaku, Slashdot and Digg. Kotaku has since deleted its post on the issue.
In the aftermath of the story, IGA's CEO Justin Townsend said that the company didn't have any intention of "playing defense" on the issue, though, to the contrary, his statements appeared all over the Web in the following days explaining what, exactly, IGA's software does and does not monitor, as well as statements from the game's developer, Dice, patently denying that spyware had been included in the game.
But no matter how many statements IGA, Dice, or EA make after the fact, damage has been done to their brand, and to the in-game advertising space. Gamers, as people who are extremely passionate about the performance and operation of their computers, are very, very suspicious of what they install. Even a whiff of spyware is enough to put people off, and some hard-core gamers hate the idea of ads in games at all.
When I was reporting this story for the OnlineMediaDaily newsletter, Townsend explained why developers are so eager to get ads in their games. "Most game publishers are going through an extremely difficult next-generation console transition. The only way for a publisher to monetize their titles is at retail," he said. "There's been a huge increase in the development cost of the game but no way to really recoup that. For gamers to have a wide variety of high-quality gaming titles available throughout the year, there has to be a means for game publishers to do that."
Townsend said, "that's the light that I would like hard-core gamers would see this in." And indeed, that's the way anyone interested in in-game advertising should hope gamers see it. But currently, that's not at all the way it's seen. Message boards about in-game advertising are filled with posts asking why, if games are being monetized with ads, prices aren't coming down.
Playing good defense and diffusing rumors of spyware isn't enough. Companies need to be proactive in explaining what, exactly, their software does, and what benefits gamers are getting.