It Costs A Lot Of Money To Shove Ads In Your Face On Xbox Live

The current version of Xbox Live sure is full of ads, huh? Why? Because ads make money. How much money? Ben Kuchera over at The Penny Arcade Report speaks to some insiders and has some figures.

Here is an excerpt of his findings (the one thing you need to know to set this up is that a "CPM" is how much the advertiser pays for every thousand times the ad runs):

The data shared with the Penny Arcade Report shows that Microsoft estimates 16 million impressions for an ad during a holiday, so an ad with a $US21.50 CPM would cost you a stunning $US344,000 to control that spot for the day. You can also buy half-day increments. Microsoft estimates that ads during a normal weekday in the first part of the year enjoyed nine million impressions, with 15 million impressions over the weekend.

Based on these numbers, Microsoft estimates that it would cost $US193,500 to control the entirety of an ad spot for your average Monday with what's called a "road block" ad. Start layering on the features, however, and that price can begin to rise very quickly.

Microsoft did their best not to help with Kuchera's story. But don't let that keep you from digging in. And don't think too hard about why you're possibly paying a yearly fee for something covered in ads. There's surely a good reason for that.

Ads up, games down: The ugly, profitable details about Xbox Live advertising [The Penny Arcade Report]


Comments

    The worst thing about this is it's a service we pay for... I don't see Sony having advertising unrelated to games on the PS3 or Nintendo having any advertising at all on their consoles. The fundamental reason I won't get pay TV is because I refuse to pay to watch ads. Unfortunately my love of gaming doesn't allow me to hold back on the Xbox. People who have gold subscriptions shouldn't have to put up with this crap., but in all reality what can we do about it?

      Exactly. I never thought I'd say it, but I'm actually missing Blades. Sony's XMB is a bit long-in-tooth but it works. I (like most here) use my Xbox to play games, I want it to facilitate that instead of cluttering my dashboard with a bunch of crap I don't care about. What's more galling is that so MUCH of it is ads that I've been forced to waste bandwidth on, there's no Ad-blocker or Opt-out.

      Microsoft, get your act together. I don't want this, Office, Bing or Windows Phone shoved down my throat when I turn on my console.

      True that being said though you don't see much of anything when the play station network is down for a month.

    Hopfully the next gen xbox either isn't riddled with ads (doubt it) or since the advertising is generating alot of money we won't have to pay for xbox live.

    More power to MS I say. If they can generate revenue from advertising on LIve then I say good luck to them.

    I barely notice the ads and would never describe them as intrusive. They are easily ignored.

      "I barely notice the ads and would never describe them as intrusive. They are easily ignored."

      There's a reason why some of these are called "Road Block Ads" because they dominate your screen and make it difficult to navigate to what you want. Look at that header photo, that's the majority of the interactive menu devoted to ads.

        There's only one ad in that whole image (indicated by "advertisement" underneath). Being the videos page, I think it makes a lot of sense that videos are listed there.

    Well at least they're not as bad as Foxtel. Live doesn't force you to watch 6 minute adverts every 5-10 minutes during a game.

      What's worse is when it's in poor taste. I used to have Foxtel and it downright pissed me off watching Comedy Channel and being forced to sit through bloody "Life Insurance" ads!

      Thanks for ruining my otherwise light-hearted TV comedy watching you jack-arses! Not mention the fact that it would appear on more than one station too and far too frequently

        I kept getting the "THIS STUFF WILL REALLY MAKE YOU LOSE WEIGHT REALLY SUPER FAST. REALLY" adverts on Comedy Channel.

        FOX8 is way worse when it comes to 40 minute (60 minutes because of ads) shows, though. A few years ago, I remember them having about 3 (fairly short) ads every 15 minutes. Now it's (probably still) 5 ads every who knows when (the fifth ad being incredibly unnecessary, as it shows 3-5 minutes after the last ad) and they're 4-6 minutes long, too :I

    My annoyance is with WHAT is advertised. You can expect literally ANYTHING to appear in some of those spots and in locations that they shouldn't be found (e.g. stuff appearing outside of the [useless] TV tab). There was something just so wrong (a while back) with having TWILIGHT advertised on the main tab.

    At least give us an option to decline or remove an ad if we find it annoying, overly useless or offensive ( I believe Facebook had an option for that). That and let us re-order tabs in such a way that WE (as individual users) consider appropriate in order of priority (for me "TV" should be last since I NEVER use it and likely never will).

      I had Justin Biebers' face greet me when I turned the console on :(

        I'll have a chat with dad about that, no one deserves that kind of punisment...

    I'd rather have the ads on the dashboards than in the games - unless it's contextual, like adverts in sports stadiums or billboards in racing games, I find that blatant product placement is just about the best way to break my immersion, regardless of medium.
    With game budgets skyrocketing and only set to get larger, I think more product placement is completely unavoidable. It's the easiest and fastest way to inject much-needed cash into an expensive project and nothing is immune. In a world where James Bond asks for a Heineken instead of a Martini-shaken-not-stirred in Skyfall (which IS happening, and cost $45m), I think Xbox Live dashboard ads are a relatively tame instrusion.

    I understand tv ads on free to air as they pay for the shows to be shown.
    I understand radio ads as they pay for the music to be played on the air.
    I understand ads in free apps (iOS or android) that help give money to the developer whilst giving it to the consumer for free.

    But what i don't understand is why the 360 has ads, and what exactly it pays for (if anything) other than pure profit at the expense to the consumer. The degree of annoyance between people may vary, but the underlying idea of why they are there just bewilders me. After buying the console and buying gold membership to get online, why are you still met with ads that don't provide you with anything?

    Haha, it doesn't bother me at all. It's not like the ads stop you or anything, you can just move past them.

    Some times I find the ads helpful, more than once I've found a new product I am interested in or some new music I've enjoyed.

    Remember, Microsoft is a business, their goal is to make money, from you and from other companies. They're not your friend or benefactor, they exist to charge you money for a service. It always amazes me how this generation seems to have failed to understand the relationship between consumers and companies. It's like they expect it to work like a friendship or something.

    Because America.

    Fact: 14% of America's landmass is now comprised of advertisements.

    I use my 360 to play games and that's about it. I'm happy as long as I can stick a disc in and press "A" to play the game without having to navigate through a bunch of menus using an ugly, unintuitive UI (yes, I'm talking about you PS3).

    Il pay more $$$ per year if I can have a xbox subscriber level that has NO ads, and a customisable home tab, I want my most frequently used features there, Media Centre, YouTube, Party chat, and Games Library...

    Lets be honest they arent going to stop the ads, so im hoping for another higher level subscription above the standard Gold, which gives you 100% ad free dashboard, the ability to move things around as you please.

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