Market News

WHY GOOGLE AND GAMING ISN'T A KILLER COMBINATION

Search Titan Eyes Move Into Ad-Insertion Market, but Buyers Have Doubts.

Google getting into video games seems at first blush like a natural evolution -- after all, gaming is hugely popular and growing, console games are increasingly web-connected, and the search giant certainly hasn't been shy about trying to apply its selling efficiency and contextual tools to other media.

But digital-media buyers have a hard time seeing how Google's simplified, automated buying processes could result in effective in-game ads.

Widespread speculation flew recently that Google wanted to buy its way into the dynamic in-game ad-insertion business by acquiring Ontario-based AdScape Media -- widely considered a second-tier player in the gaming arena because it's a technology-driven play that has few publisher relationships. (AdScape executives did not return calls, and Google declined to comment.)

Whether a deal materializes, digital-media buyers suggest Google would have to evolve dramatically to offer the immersive virtual experiences in-game advertisers have come to prize.

Not a good fit
Google is "about automation, using technology to maximize relevance and response, and the environment they'd be entering would be a bit of a departure," said Art Sindlinger, VP-activation director at Starcom. In-video-game ads, he said, lend themselves more to branding objectives than direct-response ones. Advertisers seek immersive in-game experiences rather than simpler product placement or branded billboards, which some eye-tracking studies have shown are easily tuned out.

"How will they apply what they've done so well with search to a channel that's so deep into the experience?" asks Brandon Berger, partner and senior strategist of digital innovation at NeoOgilvy. "The truth is you still need a dialogue to create these immersive experiences."

Considering a 3-D world
The skepticism surrounding any potential acquisition leads many to believe Google must have a different endgame in mind. Consider, for example, how the internet is becoming a more visual 3-D medium. Many, including IBM, which is building a private 3-D intranet, speculate virtual worlds such as Second Life represent the next generation of the web. And as that evolves, AdScape's technology that allows for ads in the 3-D world of gaming could prove increasingly valuable.

"I don't think Google needed AdScape to get into the game channels as much as they needed the technology AdScape has in 3-D-rendered worlds," Mr. Berger said.

Still, buyers hesitate to completely discount the influence Google could have. After all, it has tweaked its highly efficient, hands-off, auction-based buying models to appeal to other media. In its newspaper test, for example, a paper can make a manual decision whether to accept a bid for an ad.

Should Google desire to enter a more traditional in-game route, it would have to strike relationships with game publishers, much as it has had to do with print publishers in the newspaper test and radio groups in its dMarc radio tests. Last year Microsoft purchased in-game-advertising firm Massive, but other top-tier players in the field include IGA Worldwide and Double Fusion.

And Google does have one thing that helps when it comes to striking deals with major game publishers: cash.

By Abbey Klaassen Mailed 2007-03-20

Return to Market News list