Microsoft plans to bring ads to free Xbox games this year

Microsoft plans to bring ads to free Xbox games and is currently evaluating ad tech companies that could help manage new in-game ad inventory and work with ad agencies, according to a report. The alleged decision would allow developers working on free-to-play games to sell advertising space. It would also help Microsoft attract more developers to create new free games for Xbox, as they would get ad revenue from the new model.

Citing two people familiar with the development, Insider reports that Microsoft is working on a way to allow advertisers to place ads in free Xbox games. The ads are said to aim not to disrupt the user experience and would appear, for example, as digitally rendered billboards in a car racing game.

It’s unclear whether Microsoft would offer other types of in-game ad units, such as avatar skins and video ads. However, the report suggests that the ability to serve ads through free Xbox games could go live as early as Q3 2022.

Microsoft reportedly has no intention of reducing ad revenue from this model, although the purpose of the new ads appears to make the Xbox platform more attractive to advertisers.

Ad revenue will be shared by game developers and ad tech companies that place ads in free games, sources said.

Initial discussions to create an Xbox in-game ad network reportedly began around 2018 or 2019, although the process has accelerated in recent months thanks to the launch of the latest Xbox models – Xbox Series S and Series X – and the growth of titles. free on the platform.

One of Microsoft’s main concerns about this program is the potential for gameplay disruption. According to the sources cited by Insider, the company would only like to select certain brands that can place ads in free games. The Redmond-based company would also like to allow its chosen brands to operate through a “private marketplace” which likely won’t be available to all advertisers, at least initially.

Microsoft also reportedly has no intention of letting advertisers use the data it collects from Bing searches and behavior on its websites and software to target Xbox gamers.

Exact details as to whether Microsoft has already introduced the new Xbox ad offering to advertisers have yet to be revealed. Microsoft also didn’t confirm its plans in a statement given to Insider on the matter.

“We are always looking for ways to improve the experience for players and developers, but have nothing more to share,” the company said, according to the report.

Gadgets 360 has reached out to Microsoft for comment and will update this article if the company responds.

Microsoft recently acquired Activision Blizzard, which has a native ad network, and adtech platform Xandr. The assets of these two companies are likely to help launch the new program and bring new advertising revenue models to Xbox over time.

The concept of serving ads in games is not new. In the past, companies have attempted this even in paid games. However, Microsoft’s approach appears to be aimed at enticing developers to create more free games by natively supporting in-game ads from specific brands.

Last month, Microsoft revised the prices for Xbox Game Pass, PC Game Pass, Xbox Live Gold, and Xbox Game Pass Ultimate subscriptions in India. The move, which took effect April 1, could help convince more people to subscribe to Microsoft’s gaming services on Xbox and PC.