Back in August 2006, GameDaily BIZ talked with Yoav Tzruya, COO of Exent. In that discussion we touched on the subject of Exent's new in-game advertising technology. This technology allows publishers to implement in-game ads retroactively, as Enlight did with several of their titles.

This technology has since been named: AdMuse. Its sort of reach could turn the in-game advertising business on its ear, with potential interest from circles not necessarily in the usual gaming sphere. With nearly a half-year past, GameDaily BIZ decided to re-explore Exent's progress while delving deeper into AdMuse functions.

We caught up with Tzruya once again, who generously took some time out of his busy CES week to talk about Exent's Muse.

At the center of AdMuse is Exent's basic philosophy of in-game ads. Namely, ads should be featured in-games for the benefit of all parties, and that includes the gamer themselves.

"In order to understand what it does, it's important to explain what Exent has done to date," explained Tzruya. "We help to power services like GameTap, the similar CBS service, Verizon, and various European services. We're seeing 70% conversion from trial to paying users. People spend 30 hours a month on these entertainment services. These are really interesting numbers for the service providers. However, the services are not promoted at the level we would have liked to see them, because of limited marketing budgets. Seeing this led to our development of a technology that allows in-game ads into older games - the kind of games that exist on our services. This would allow us to push for ad-supported offerings into the market, offsetting the marketing budgets. We believe we can generate significant inventory this way. At the same time, we didn't feel like we had the resources to make our own ad network, so we teamed up with leading partners to provide ad-serving and ad-sales. We don't compete with MSN, Google, Massive, Double Fusion, IGA and the like; we see them as partners. We use the technology to generate the inventory, and they generate the ads for the inventory."

He added, "We did launch into Europe, with a free ad supported channel with a mix of content; casual and hard core content for everyone. The results we can disclose about the European free/ad-supported games channel is that we are able to reach ~8% of the overall broadband base to play at the service every month. On average, these users spend 10 hours on the games in the service. On an overall basis, we see that 30%-35% of the overall broadband base is interested in such a service and interacted with it. If you compare the above 8% to the rating of any TV show or TV channel, this is a high number which would highly interest advertisers. This is a really good offer and we're going to be launching similar offerings during Q2 in the U.S."

AdMuse is the sort of technology that has the potential to make a big splash in the market of in-game ads. Publishers, advertisers, media companies... they all stand to make money from this new stream of revenue. Additionally, no "integration" has to happen with the original code; AdMuse can be added separately and retroactively. Thus, Tzruya explained that the term "served" is much more appropriate than "integrated."

"There are three types of entities most likely to be interested in this," detailed Tzruya. "Firstly, it's publishers who stand to generate money from their new games as well as from their old games catalog. Actually, when we propose the technology for their back catalog they say, 'Why don't you use the technology for our new games as well?' being interested in saving money over the alternative of integrating an SDK into the game. Furthermore, the flexibility of our platform, allowing defining avails on the fly, allows them to Instead of gambling on ad spots, they can try measure the first few hundreds of thousands of game sessions and only then select the spots that really work."

"The advertisers have an interesting perspective. The problem with in game-advertising is that we talk about selling the same games to the same users: it just doesn't have the same reach as other mass media. When we target old units, it's not only a more diverse inventory, but it becomes a larger market than before.

"The third type is a media company. When they see this, they'll see what Ted Turner did with movies in the early '70s. Repackaging old movies, except they're ad supported on cable. Movies generate 25% from box office, 50% from DVD, and 25% from movie channels. And now game publishers are looking at a whole new opportunity for ad supported titles."

AdMuse is more than just potential at this point: it's already been implemented. This includes mainstream titles like Colin McRae Rally, Operation Flashpoint and Sensible Soccer along with casual titles like Magic Ball and Restaurant Empire. We'd bet money on Exent's client list expanding greatly in the very near future.

"AdMuse dramatically extends the reach of in-game ads and changes the default business model," asserted Tzruya. "We've already heard the statements from Double Fusion that they like to make $1 or $2 dollars on every unit. But what we're able to do is more than that by utilizing games that have stopped making money. If you look at the sheer numbers of gaming units that are in the channel right now... and if you consider all those users, we're talking about billions of dollars in gratuity."

"The point to emphasize is by using this tech solution is that we create a whole new release window for games, and not just an incremental revenue stream." he concluded.