Microsoft reportedly working on putting in-game ads in free-to-play Xbox games

Ad-chievement unlocked

Microsoft may be looking to insert more in-game ads into free-to-play Xbox games. A new report indicates the company wants to let advertisers place advertisements inside free-to-play games on Xbox, going live by the third quarter.

Business Insider reports that this new program would add more games that brands can advertise in, and allow more developers to sell ad space. Their sources indicate these ads could show up as billboards in a racing game, for example. Insider did not learn if other options, like cosmetic skins for characters or video ads in lobbies, are in the works. They also couldn’t confirm if Xbox is pitching the service to advertisers yet either.

New revenue

According to the report, Microsoft may not be interested in taking a cut of ad revenue from in-game Xbox ads. Instead, the revenue would be shared between the game developer and the adtech company that places it. One of Business Insider’s sources speculates that Microsoft wants to provide more money-making opportunities for free-to-play game developers. Their sources also say Microsoft is worried about the potential backlash of inserting ads. They say Microsoft may try to create a marketplace where only select brands can insert ads, in a way that doesn’t disrupt the gameplay.

In a comment to Business Insider, a spokesperson did not confirm the plans. The spokesperson says that Microsoft is “always looking for ways to improve the experience for players and developers but we don’t have anything further to share.”

Xbox does currently allow some forms of advertising in its games. Ads already exist on the Xbox dashboard. And in-game ads are nothing new to games, though they haven’t always received a favorable response. Look at the fan response to in-game ads in Electronic Arts’ UFC 4.

It’s a fraught area to wade into for Microsoft. The report says the plan will come to fruition later this year, and we’ll see if and how it turns out then.