Mediaweek is reporting that Microsoft is shutting down Massive Inc, an in-game advertising firm it picked up back in 2006. The acquisition is said to have cost Redmond between $200 and $400 million, and sources claim the OS giant was unable to sell the firm for considerably less.
So, has the bottom fallen out of the in-game advertising market? Not exactly. According the Mediaweek, advertisers prefer to hawk their wares through Xbox Live. That arrangement conveniently nets Microsoft all of the profits, which would otherwise have to be split with game publishers. Electronic Arts decided to handle in-game advertising for its own titles earlier this year, and other publishers may be inclined to follow that lead.
Maybe it's the types of games I play, but I haven't noticed much advertising embedded in recent titles. When I have seen the odd billboard or obvious example of product placement, it hasn't seemed forced or inappropriate. Thanks to Ars Technica for the tip.