The company already handles billions of web interactions. And its technology could become important to the video game industry
As has been well publicized, in-game advertisements are big business and are continuing to soar. Some expect it to become a $1 billion dollar business by 2011. One very large component of that is the ability to serve ads online, dynamically.
Companies like Massive, IGA and Double Fusion have their own network and their own ways to deliver ads to clients. Their reach is impressive, but they don't yet cover the breadth of the Internet. One company that already does reach far and wide and could help in-game ads reach new heights is online business solutions provider Akamai.
We chatted with Kris Alexander, Product Director at Akamai, about what his quietly successful company ultimately means to the growing in-game advertising market.
Akamai is Hawaiian for Smart or Intelligent
If the name "Akamai" doesn't ring a bell immediately, don't feel bad. Like any industry, the Internet has several companies that are very successful filling vital, background rolls. Akamai does so successfully for not just gaming companies, but financial institutions, hotel operators, manufacturers, media conglomerates, the Department of Defense and more.
"We have a couple of different core businesses, dealing with the caching and delivering of small objects online," detailed Alexander. "To do that, we have our servers placed in thousands of networks around the world. This allows us to serve data quicker, since it means you don't have to traverse multiple networks to get something in cache. This often deals with small amounts of data, but the real evolution for us was being able to deliver full pages of HTML. We serve a number of businesses with dynamic site capabilities and finding the fastest path in real-time to deliver information is crucial. We've had customers in this space for a number of years, which we feel is a recognition of our ability to deliver large assets."
"Games are a large part of our business," he continued. "Nintendo, Sony Computer Entertainment, and Microsoft are all our customers. We can deliver massive game files to users globally and since we can identify fastest routes, it opens up numerous real-time applications. This includes games like real-time strategy, first-person shooters and MMOs."
What Akami Means to In-Game Ads
This experience with the transferring of data worldwide via a network makes Akamai particularly well placed to enter the in-game ads sphere. The future of the in-game advertising space will be the placement of dynamic ads via the Internet and Akamai's tech can not only transfer data quickly but also make the ads relevant to each user, based upon their behaviors online. It's similar to the "Holy Grail" talked about before.
"For a lot of our customers that we've partnered with, we enabled a lot of new business models that have evolved over the past couple years and will continue evolving into the future. We worked with Sony and Nintendo before their latest consoles launched," explained Alexander. "That's right, we're not limited to the PC realm; we are the delivery platform for both Sony and Nintendo. That means that we're helping to deliver patches online for the Wii and we're also used when someone buys a game or downloads a trailer via PlayStation Network. We also work with IGN and GameSpot and enable them to deliver objects on their site. We helped GameSpot stream video from the recent E3 press conferences. We're in a lot of places at the edge of the network, whether it's small images or pop-up content or full websites."
Alexander couldn't address specifically which game companies Akamai has worked with in the in-game ad realm, but he did talk about the importance of targeted ads. "There's nothing that we can talk about publicly yet. I can talk about our methods, though. Because we measure the passing of data on our network, we can determine where certain users are coming from. We look at the sort of assets we're going to send, and we're trying to make sure they're presented in a meaningful way that doesn't take them out of game experience. Better targeting the end user is something we have a lot of solutions to work for, which is important. The gaming audience is so fickle and so fast to bash something if they have a bad experience, so you have to get it right the first time."
Alexander also denied any intentions to compete directly with other in-game advertising companies, choosing instead to work with all parties. "Think of us as a technology company that provides a small but important roll for partners like Coke or EA," he explained. "We're the people behind the scenes with enabling technologies to do things more efficiently that they could use on their own. We'll continue to do this."
Akamai Moving Forward
As far as the Internet has come, web business is still nascent and is forever changing as new technologies or ideas are introduced. Akamai has been riding the wave of such changes since the company's inception, and online gaming is just one primary example. Being able to tap into in-game advertising is yet another way the company is leveraging its refined data network.
"I think that there'll be ways we can more finely target [with in-game ads]," explained Alexander. "It's important to have the ad be relevant and not to take players out of the gaming experience. This comes from profiling the end user and understanding him. The information can be based upon an online profile, what they've interacted with online, what their habits on the Internet are, etc. We're looking at ways that we can more finely hone the delivering of messages to end users so that it is more meaningful and not detracting from the experience. If you're bringing something their interested in, you've enhanced their experience."
"You can also have interactive placement within the ads and actual mini-games," he continued. "With richer and richer applications, you talk about who you're going to be interacting with and that's the challenge that Akamai will be able to address. This is the evolution of Web 2.0 technologies. You're seeing a blending of worlds. Things that could bring you new content, or contain a game within the primary game itself, we work on how to bring these technologies seamlessly to the end user. Web 2.0. I see as a new spectrum of functionality going forward."
The impact of the online world has been huge for in-game ads, but to what extent "depends on the platform and client," said Alexander. "Think about things on a console or PC, FPS or MMOs; they are more interactive than static mediums. You want to either get a video or 3D model in there, and this is especially true to things that are casual. There are numerous different ways to interact with a casual gaming audience."
"There's been massive growth of online games and online networks, due to the ability to interact with sites and other people, but if you think about the applications on a device or desktop, you can do more of that online," he added. "Things like Turbo Tax, which you can now do through their website. So I think about things that, currently, you use [offline] on your desktop you'll do through the Internet in the future."