[casual_games] Google's Next Ad Frontier May Be Inside Videogames

[Joe Pantuso]

The ad landscape continues to change.  Does anyone have experience with
Adscape?  Their site gives the impression they try to target 'gamer' games
and not casual.


Google's Next Ad Frontier
May Be Inside Videogames
By NICK WINGFIELD and KEVIN J. DELANEY
January 20, 2007; Page A2

Google Inc.'s efforts to broker advertisements beyond the Web could
soon expand into ads that appear in videogames.

The Mountain View, Calif., company is in talks to acquire Adscape
Media Inc., a closely held San Francisco company whose technology
allows for the delivery of advertising over the Internet and
placement within videogames, according to people familiar with the
matter. They added that a deal could be reached as early as next week.

While the possible terms of a deal aren't known, Microsoft Corp. last
year acquired Massive Inc., a company that delivers in-game ads, for
close to $200 million.

An acquisition of Adscape, if completed, would allow Google to offer
the hundreds of thousands of advertisers who currently buy online ads
through its system to also buy ads that appear within videogames. The
market for delivering ads into games -- such as a virtual billboard
on a racetrack or a poster in a boxing arena -- is still in its
infancy, but major games publishers such as Electronic Arts Inc.
believe it could be a lucrative business and many are pursuing it
aggressively. Sending ads over the Internet is just now becoming more
feasible through new game consoles such as Sony Corp.'s PlayStation 3
and Microsoft's Xbox 360, which are designed to be connected to the
Internet.

One person familiar with the matter says Google for months has been
discussing with game publishers the prospect of delivering ads over
the Internet into the action of their games.

If completed, a deal with Adscape would form part of an ambitious
Google effort to broker advertising across many types of media
globally. The Internet company, whose 2006 revenue is expected to top
$10 billion on the strength of its online-ad sales, currently is
testing systems for selling ads in newspapers and on radio, and has
said it plans to extend into television ads. People familiar with the
matter say it is discussing a possible agreement with CBS Corp. that
would include brokering TV and radio advertisements. Both CBS and
Google have declined to comment on any talks.

A Google spokesman declined to comment on any talks with Adscape,
saying "We are always considering new ways to extend Google's
advertising program to benefit our users, advertisers and publishers.
In-game advertising offers one such possible extension among many
others."

Adscape Chairman Bernard Stolar said he "has spoken to every major
player" about a possible acquisition of Adscape, but there currently
is no such deal.

People familiar with the matter say Google had looked at Massive
prior to Microsoft's acquisition of the company. A purchase of
Adscape would add a new front to expanding competition between Google
and Microsoft, which today stretches from Web search to word
processing. Google could look to form an alliance with Microsoft's
archrival in the games console business, Sony.

In-game advertising has attracted an array of contenders, including
IGA Worldwide Inc. and Double Fusion Inc. Adscape's chairman Mr.
Stolar is a well-connected veteran of the games business, having
previously served as an executive at Sega, Sony's U.S. games division
and Atari, and could help Google form crucial partnerships with
publishers.
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