An unconfirmed report in the Wall Street Journal has suggested that Microsoft executives are planning to acquire in-game advertising firm Massive Incorporated, in a deal believed to be worth between $200 to $400 million, with the official announcement to be made next week.
The article indicates that Microsoft is expecting to acquire the entirety of the New York City based company, which currently employees around eighty staff. Microsoft is reported to be keen to control how adverts are placed within a game and to try new business models which could allow the ads to subsidize lower prices for particularly expensive titles, such as massively multiplayer online games.
No specific mention was made of the Xbox 360, which already displays advertising-like banners on its dashboard operating system, but has not yet permitted in-game ad companies to stream advertisements into games through Xbox Live. However, it is implied that Microsoft would not be using Massive's technology purely for Windows based games.
The report in the Wall Street Journal follows increasing interest in areas based around games and advertising, with Viacom recently purchasing in-game instant messenger developer Xfire
and a number of studies
suggesting that the in-game ad market in general is set to increasing rapidly over the coming years.
If confirmed, a Microsoft/Massive deal would significantly shake up the in-game ad market, for which deals with major publishers are swiftly expanding, as companies including Double Fusion and IGA Partners fight for game market share. This shake-up would be especially true considering that Massive has already signed prominent deals with Sony Online Entertainment, a major division of Microsoft archrival Sony, and is providing in-game ad serving for some of SOE's MMO titles, including The Matrix Online
. However, neither company has yet made an official statement on the matter.