) bought Adscape Media, a small in-game advertising company, earlier this year. Analysts say revenue from the ads is helping video game companies offset the soaring costs of development: Kaminsky said the ads are a growing, multimillion-dollar business for Activision, though she did not give specifics. In July, Nielsen for the first time released data measuring in-home video gaming activity, gathering the data electronically, similar to the way it tracks TV audiences.
"We really believe that usage is going to be the key metric for the advertising market," said Gerardo Guzman, marketing and business development director at Nielsen Games. The measurements track what consoles people are playing, but not exactly what titles - though Nielsen is working on that next. "We don't have an exact timeline," Guzman said, though he added that the current plan is for early next year.
He noted that historically, most video game revenue has come from brick and mortar sales, so the industry looks to retail sales data to gauge how well games do. But the video game environment is changing. Many users are buying games online, and software publishers are spending more money and time to develop titles.
It's not unusual for a new video game to be in production for 18 months and cost as much as $20 million to develop, Guzman said. And with some games taking as much as 100 hours to complete, game usage makes for a much broader world to measure than retail sales. Publishers say dynamic advertising, which integrates ads into the story line of games, helps make them more realistic.
Of course, there are some games where ads just wouldn't make sense. Activision's upcoming "Call of Duty 4: Modern Warfare," uses a Voodoo computer from Hewlett-Packard Co.
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