WildTangent Teams Up with Playdom to Deliver Ads in Social Games

This week has been surprisingly quiet for Seattle-area gaming companies, even though the annual Game Developers Conference is going on in San Francisco. Well, OK, Kelly Ripa plugged PopCap’s flagship game, Bejeweled, on “Live with Regis and Kelly”—but does that really count?

Here’s some more substantial news. Redmond, WA-based WildTangent, one of the elder statesmen of the local gaming scene, announced today its new advertising platform, called BrandBoost, is being used by Playdom in its popular Facebook game, Tiki Farm. Playdom, a social game developer based in Mountain View, CA, has other Seattle-area connections as well. Last week, the company acquired Bellevue, WA-based Offbeat Creations for an undisclosed price and is merging the startup with Playdom’s existing Seattle studio.

The deal provides some validation for WildTangent’s advertising model, which it has been pursuing for a couple of years now. The model essentially gives gamers the option of playing for free if they view a 30-second ad—similar to the Hulu advertising model for TV. WildTangent gets a cut of the ad revenues from the game developer; advertising makes up about half of WildTangent’s total revenue. The Playdom deal is the company’s first big placement of its advertising platform in a social game.

Last year, WildTangent’s founder and former CEO Alex St. John gave me a rundown of the company’s efforts in ad-sponsored play. But it sounds like it has progressed quite a bit since then. Sean Sundwall, WildTangent’s director of corporate communications, says revenues for 2009 grew by 40 percent over the previous year, and the company is profitable. He says that other game portals use banner ads, but that most companies haven’t gotten as far as WildTangent in offering ad-sponsored play.

That’s in part because it takes a lot of time and money to make this kind of advertising work in the gaming world. To that end, WildTangent has a sales force of more than 30 people based in New York, Chicago, and Los Angeles. They have the experience and credibility to compete for the attention of major brands, Sundwall says.

Looking back over the history of WildTangent, it’s been interesting to watch how it has shifted from developing and publishing games to distributing them and selling ads, and from PC and downloadable games to online games. “We’ve evolved to be where the eyeballs are going,” Sundwall says. Today, that means casual games on Facebook, MySpace, and other social websites.

WildTangent is led by CEO Mike Peronto, a company veteran who has been at the helm for about 18 months. The firm started in 1998 and has raised more than $50 million in venture financing from Madrona Venture Group, Advanced Technology Ventures, Greylock Partners, IDG Ventures, and others.

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