Blog Post

Microsoft’s In-Game Advertising Unit Stands Up For Itself

It’s been a difficult year for Massive, the in-game ad company that Microsoft (NSDQ: MSFT) purchased for between $200 and $400 million in 2006: The unit was disproportionately hard-hit in Microsoft’s recent layoffs (28 percent of Massive’s staff was let go) — and we had heard that Microsoft was shopping the unit and was willing to sell Massive for a fraction of what it paid for it.

But in a blog post this morning with the headline “Facts are Stubborn Things…,” Massive GM JJ Richards counters what he describes as “inaccurate information” and “wild speculation.” Massive, he says, saw “double-digit year-on-year revenue growth” during Microsoft’s fiscal year, which ended in June. So far this quarter, the unit has exceeded its first quarter sales targets “by more than 100%” just one month in (Big caveat: No details on what the target was). “We’re seeing light at the end of the tunnel,” he says. He also emphasizes that “in-game advertising remains an important part of Microsoft Advertising’s offerings.”

As for the sector at large, which has been hit, along with the greater fall in advertising spending, Richards refers to a Screen Digest report that said that in-game ad spending would top $1 billion by 2014. Fine, but worth noting that former Massive CEO Mitch Davis told a conference, just prior to his firm’s sale, that he expected in-game ad spending to reach between $1.6 and $1.8 billion — by 2010.

One Response to “Microsoft’s In-Game Advertising Unit Stands Up For Itself”

  1. Bobby N.

    In-game advertising has not developed as was hoped or, in the case of Massive and Mitch Davis, hyped. He sold MSFT a bill of goods and they bought it hook, line and sinker. Emphasis on the sinker part of that.