Nolan Bushnell: In-Game Ads Don't Work

Atari founder Nolan Bushnell told us last week that violence and long form gameplay lost the casual gamer decades ago. In the ensuing years, Bushnell himself has retained a casual approach to gaming.

In addition to founding uWink, a GameWorks-like restaurant chain mixing food, drinks and games, he was recently recruited as an advisor for NeoEdge, a Silicon Valley company focused on incorporating advertising in casual games.

NeoEdge operates, which houses popular casual games like "Diner Dash" and "Luxor." It operates under the growing economic model of offering full versions of their games absolutely free, if you'll look at a few ads. These ads can come before, during or after a gameplay session, but unlike typical in-game advertising, they are not hidden in the environment.

For years, companies have been looking for ways to incorporate the advertising directly into the game itself. It's why Microsoft paid undisclosed millions for in-game advertising firm Massive Inc. two years ago.

But Bushnell isn't convinced that in-game advertising, like that seen most recently in Ubisoft's "Rainbow Six Vegas 2," is going to work.

"In-game advertising is much, much more [in your face] advertising and is more like a billboard," said Bushnell. "I don't believe those kinds of ads are very effective. In a game, if you're not riveted on the objectives, you're going to lose."

Bushnell looks at the TV model as a good example. TV often places advertising before a show, after a show and during set breaks in the action. The problem with the TV model, he argues, is how inflated the cost of entry has become.

A TV ad can cost upwards of millions. There are countless people playing casual games, yet not many ways to monetize it. There's opportunity there, he said.

"[TV ads] sometimes have multi-million dollar budget to really sell a message in style and grace in 30 seconds," he said. "It becomes very, very easy for an advertiser to go into the NeoEdge environment and before, middle or end of game, you can see an ad."

Advertising and games are an inevitable mix, but how do you want it served?