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April 27, 2006

Ad-supported Xbox Live?

Posted by Benjamin J. Romano at 11:11 AM

In reporting on Microsoft's rumored acquisition of in-videogame advertising purveyor Massive, I came across an interesting poll at Joystiq.com that sheds light on gamers' opinions about ads in their games.

Xbox Live, which currently costs $50 a year for a Gold membership, is a natural platform to deliver advertising to a demographic group that's spending less time with traditional media channels.

Of the 1,949 Joystiq poll respondents who described themselves as current Gold subscribers, those willing to continue paying to avoid seeing ads outnumbered by nearly 2-to-1 those who would accept ads if the fee were dropped.

In addition, 452 people, or 12 percent of respondents, said they "do not subscribe to Xbox Live Gold, but would sign up if it were free but ad supported."

The poll, conducted online in January, is by Joystiq's admission, unscientific and susceptible to hacks.

Gamer tolerance for advertising is a critical question. The industry hasn't figured out how much advertising is too much. But somebody's going to cross that line and get burned, industry watchers said.

"I think we'll see marketers push it too far at some point and gamers will probably fight back, there will be a bit of a backlash," said Jeff Lanctot, vice president and general manger of Avenue A | Razorfish.

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