We reported that Microsoft might be considering adding ads to free-to-play games on its Xbox, but it seems its arch-rival, Sony wants to do so too in its PlayStation games, according to a report by Insider.
Sony will display the ads within the game, giving developers another way to make money for their work. It should encourage them to keep making free-to-play games. Currently, game developers can only make money through in-game purchases and microtransactions. This category of games got popular during the pandemic, and Sony obviously wants to maintain the momentum.
Insider reports the ads will start showing this year, and like Microsoft, PlayStation will try to make them unobtrusive. As such, the ads will appear on billboards in stadiums or on the roads, and the like.
Players may also get rewarded for watching an ad like some games and apps offer on Android. They may get otherwise paid-for content like skins or weapons.
The ad placements will be sold through a private market, according to Insider. However, Sony has not decided whether to get a cut from the revenue made through the ads. But reports say it is considering making developers and publishers pay for user data. Insider says Sony will be strict with which companies will be allowed to be part of the program and will ban harvesting user data like names and emails.
Unlike Sony, Insider reported that Microsoft did not intend to share the ad revenue with the game developers. Microsoft may also roll out the service as soon as the third quarter of this year.
Sony is allegedly working with companies in the ad-tech space to create the infrastructure for developers to include the ads in their games. The company was said to have started considering in-game ads about 18 months ago when it launched the PlayStation 5. However, the service is expected to launch on both the PS4 and PS5.
PlayStation games can currently display ads in their menus, usually showing links to other games by the publisher in the store, but this effort will open up the ad sourcing pool to third-party companies.
Meanwhile, Insider pointed out a possible problem with the ad placements. It may not be easy to convince companies to join the program due to the nature of many free-to-play games. They often feature mature or violent content, and some companies may be wary of displaying their products in such scenes. This may significantly narrow the pool of potential advertisers. The publication also points out that tracking what users do after seeing the game may be challenging but is vital to advertisers.
Faced with the reality of the consumer space, more tech companies are considering generating revenue through ads, whether for themselves or other companies in their value chain. Google has always been ad-based, and Netflix, after suffering a net loss of subscribers for the first time in its history, is finally considering offering a cheaper plan supported by ads. This comes even though the streaming platform recently increased its subscription costs.