Microsoft eyes in-game advertising

Microsoft eyes in-game advertising

Rumoured deal with Massive Inc worth $400m

Microsoft is rumoured to be making a bid for a specialist advertising agency that sells adverts in video games.

Massive Incorporated places ads in console games being played online, such as in Xbox 360 games running on Microsoft's Xbox Live service.

Speculation valued the New York-based ad agency at $400m. However, Microsoft was tight lipped about the reports.

"We do not comment on rumour or speculation and that's what it is at this stage," a spokeswoman said.

According to Massive, the company has served ads to more than 35 million game sessions.

"After three years of development, play testing and gamer feedback, Massive has obtained the most comprehensive understanding of the gamer audience and its reactions and preferences for video game advertising," says a statement on the company's website.

The rumoured deal between the two companies follows Viacom's purchase of the Xfire online gaming platform.

Analyst firm Yankee Group said in a recent report that the market for in-game advertising will reach $732m by 2010.

Massive Inc claims to have more than 20 blue-chip advertising partners in categories such as entertainment, packaged goods, telecoms, technology, automotive, fast food restaurants and financial services.