YouTube to sell music and games while Google gets ready to play

8 Oct 2008

Google is planning to enter the casual video gaming market, while subsidiary YouTube has revealed plans to sell music, films and games online through alliances with and Apple’s iTunes store.

This morning, in what may be one of the most strategic moves out of the Googleplex this year, Google has updated its AdSense advertising platform to incorporate the massive market for online casual gaming, a move that no doubt will feed into mobile too.

It said that over 25pc of internet users worldwide play online games, which amounts to over 200 million people. This number is growing at a rate of almost 17pc each year.

Meanwhile, its subsidiary YouTube said that it will start to sell music and video games as an experiment with new music formats to grow revenue.

YouTube is in the process of building an e-commerce service that will sell music, TV programmes, films, video games, books and concert tickets alongside the millions of videos on YouTube.

Users can buy the songs from music videos or film trailers by clicking on buttons that take them to either or Apple’s iTunes store.

Meanwhile, YouTube owner Google said it is expanding its AdSense business to incorporate the casual gaming business online by bringing out AdSense for Games.

“To continue to fuel the growth of online games for users, and as part of our ongoing efforts to develop new ways for publishers to earn revenue, Google announced today the availability of AdSense for Games, a programme that integrates video advertisements into web-based games, complemented by text and image ads”, the company stated. “The programme helps advertisers reach its audiences in new ways.”

Google said it is working with select game developers and publishers including Konami, Playfish, Zynga, Demand Media, games network Mochi Media, as well as beta advertisers such as Esurance, Sprint and Sony Pictures.

“With this programme, advertisers can now reach the growing number of gamers who are engaged in online play. For instance, in anticipation of a sporting event, an advertiser can use the technology of AdSense for Games to feature its logo within that sports event’s accompanying online game and reach its relevant demographic as a result.”

AdSense for Games delivers video ads based on intended placements, as well as image or text ads based on contextual targeting with keywords and tags supplied by developers and publishers.

Advertisers are charged on a cost-per-impression or cost-per-click basis, and ad revenue is split between Google and game developers or publishers.

“AdSense for Games gives game developers a new way to monetise their games and advertisers additional tools to reach their audiences, ultimately benefiting users by spurring innovation in the online gaming space,” Google said.

For the time being, AdSense for Games will be only available in beta to select partners in the US, the company said.

By John Kennedy

John Kennedy is a journalist who served as editor of Silicon Republic for 17 years