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In-game ad unit to be liquidated by parent company nearly four and half years after being bought out for $200-$400 million.
In May 2006, Microsoft bought Massive, a rising in-game ad company. Unfortunately, three years later, the bloom was off the rose. That's when Microsoft cut 28 percent of the firm's workforce as part of a company-wide staff reduction of 3,000 people.
Now, according to an article in Adweek, Massive is being shut down entirely. Citing unnamed "insiders," the trade magazine reports that the division's general manager, JJ Richards, is seeking employment elsewhere, while the tech and marketing teams of the company are being transferred into other departments within Microsoft.
As of press time, Microsoft reps had not responded to requests for comment. However, if confirmed, the closure would mark a remarkable decline for the business unit, which was reportedly purchased for between $200 million and $400 million. When it was bought, in-game ads were all the rage in the game industry, with then-CEO Mitch Davis predicting a $2 billion market for the spots by 2010.
Adweek blames Massive's closure on two big factors. First is Xbox Live, which Microsoft is favoring because it doesn't have to share ad revenue with third-party publishers as it does with Massive. The second culprit is one of those third-party publishers--Electronic Arts--which decided to take all of its own in-game ads in-house earlier this year, thereby depriving Massive of a large chunk of its business.
-Letting Derek Smart work on your game is like letting Osama bin Laden work in the White House. Something will burn.-
-And on the 8th day, man created God.-
Comments
Hopefully this game can survive long enough to get the graphics engine update completed. Moving slow, but still moving. The new heads are nifty.
I miss the MMORPG genre. Will a developer ever make one again?
Explorer: 87%, Killer: 67%, Achiever: 27%, Socializer: 20%
The Free-To-Play version is not going anywhere...there are many benefits to the program beyond advertising revenue.
Colin Cragg
CPO - World of Horsecraft AB
www.starstable.com
Thanks for stopping by and clarifying, Means. Just had me a bit worried when I seen the announcement, knowing that the froob program was supported by those ads, at least originally. Nice to know you've found other ways/reasons to keep it viable.
Are you guys going to be looking into a different ad provider, or maybe considering doing like EA and just charging companies individually and hosting the ads yourselves? That might be a good idea actually, as it would raise your profit margin a bit from those ads without having to deal with a middleman plus give you more ablity to select what ads are in the game itself. Just a thought.
-Letting Derek Smart work on your game is like letting Osama bin Laden work in the White House. Something will burn.-
-And on the 8th day, man created God.-
Holy crap Means!!!!! Thanks for the info...
Now get back to work and get that damn graphics upgrade done!!!!!!!!!!!!
Playing: Rift, LotRO
Waiting on: GW2, BP
I don't think they could shut down the F2P stuff anyway. The paying customer base relies on it for storage, and it is a tried-and-true way for gaining subscribers.
~\_/~\_O