How do ads in games benefit gamers?
Joystiq reader "Pickypants" asked a great question earlier this morning in our post about Microsoft's acquisition of Massive Inc.
He asked, "how -- specifically in games -- will ads give a benefit to the end user?"
First, just to get this out of the way: we know that ads can be evil. We'll be the first to slam anyone that clumsily inserts advertisements into a game in such a way that it hurts the in-game experience. That's a given! But let's move past the issue by assuming for a moment that advertisers, developers and publishers are aware of gamer alarm over the prospect of in-game ads. These parties know that they'd be hurting their businesses if they were to bludgeon gamers with ads because the resultant backlash would dampen game sales.
Context laid, let's answer the question:
Many beloved casual games wouldn't exist at all if it weren't for the opportunity to earn advertising money off of the traffic that these games generate for portals such as MSN.com, Yahoo.com and Shockwave.com. It's impossible to estimate how many game development jobs have been created because of the ad-supported content model, but we're certain that there are people developing creative, excellent games today who would not have ever had the opportunity to do that if it were not for money generated from advertising. Gamers benefit because more creative minds working on games equals more fun games (it also equals more crappy games, but we assume cream will rise to the top).
If ad revenues keep developers afloat, then developers go on to create new games. How many promising projects have been cancelled because publishers cut a developer's funding? How many really creative people have left the industry after their studio went bust? More money from a wider variety of sources will support a bigger industry.
What if Microsoft could make Xbox Live Gold free as a result of an ad-supported model? More gamers would use the leaderboards and other features that are exclusive to Xbox Live Gold, and more developers would be drawn into creating attractive and useful features for online use. It would be a self-reinforcing cycle. The in-game features that we see on Xbox Live today are somewhat half-baked, in part because developers have a hard time spending that much time and money developing features that only a small portion of the Xbox 360 audience will ever use. Leaderboards are easy. How about live ladders and tournaments? How about in-game pictochat? In short, the ad model can potentially drive gamers into connectivity. Connected, dynamic games can do way more cool stuff than static games.
Realism can be enhanced through advertising. As Joystiq reader "Grindstone" put it, "I personally welcome in-game advertising. Not to offset costs, but to make the gaming experience more real. Obviously I wouldn't expect to see a Taco Bell sign in Oblivion, but I sure as hell wouldn't mind seeing a Subway being burned down in GTA, though."
In sum, ads can be beneficial. They can also be horrible and stupid and offputting. We're optimistic that the people working on the advertising in games business are smart enough not to shoot this nascent business model in the foot.