Advertisers look to place products in games

— 1:58 PM on February 10, 2004

As the cost of developing games increases, publishers may increasingly turn to product placement as an additional revenue stream. EA is already working with a number of companies to place products and logos in its games, and publishers like Activision, Sega, and Midway are also seeking advertising deals.

Video game companies said that the money they can earn off of product placement deals will never eclipse revenues from game sales. "We're not NBC. We don't maintain our business by attracting corporate advertising," said David Anderson, senior director of business development at Activision. Still, a six-figure deal with an advertiser defrays some of the costs of game development, which can run up to $10 million in the industry.
So far, advertising and product placement in games has been largely confined to sports titles, which seems reasonable considering real-world sporting events are already dominated by advertising and endorsement deals. Still, I can see advertising and product placement invading other genres. It may only be a matter of time before first-person shooters let gamers replenish their health with a bottle of cold, refreshing Gatorade.
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