Google Testing In-game Ads

For the past month, Google has been testing its “Adsense for Games” program in online flash games.

Since its acquisition of small-time in-game advertising firm Adscape Media a year and a half ago, Google has remained quiet about the progress of its “Adsense for Games” program.

Recent reports are now confirming that the search giant has been testing video ads for over a month, likely with its partner Bunchball. Bunchball is a member of Google’s OpenSocial social networking effort and a Flash games developer with a few Facebook applications. A second effort, whose current status is unknown, was a release of Double Fine’s Psychonauts via digital distribution centers Steam and GameTap that included pre-game video advertisements.

“Google launching with Psychonauts as a trial platform is like a new cable network launching with a Coen Brothers movie,” explained GigaOm’s Wagner James Au.

Google’s technology’s unique advertising offering allows in-game characters from whatever game a player has opened to introduce the ad. For example, the dealer in a Flash Texas Hold’Em game could say to the player, “And now, a word from our sponsor,” and then a video advertisement would roll.

Heavy competition isn’t coming solely from major in-game advertisers like Microsoft’s Massive and giant IGA Worldwide. Yahoo! Games signed Neoedge and Double Fusion to support its own games portal.

“I don’t know what’s taking them so long,” said one source to VentureBeat. “They could move into this market very quickly, given what they have shown off.”