Long gone are the days when gamers can pick up a box of a game for a fixed price and play to their hearts desire.

Let me start with a brief history of revenue generation in the gaming industry, I will stick to PC gaming as to not make it too long.

First, there was identical software packaged in a box and you only had to pay for it once.

Next, online peer-to-peer sharing took hold and games could be copied so developers included unique “cd-keys” along with each box and only one could be used at a time. Gamers found a way around this by creating their own servers that did not care what a users cd-key was.

Developers fought back by introducing monthly subscriptions and much more complicated server settings in order to prevent (delay is a better way of looking at it) users from creating their own servers. Eventually, users got around that as well by creating their own enhanced servers on which users could play with a pirated version of the game. World of Warcraft fell victim to this phenomenon.

Fast forward to today, developers have finally found a way to charge for games on PC as well as mobile devices in a way that has yet to be thwarted by the gaming community.

Welcome to the world of virtual goods and buying advancement in-game. Developers offer games for free and engineer the games in a way that you can advance just far enough to get addicted to the game without having to worry about paying a single dollar. But once you reach the “point of no return,” you will find that advancing in the game is extremely time consuming and that you are out-gunned, out-classed, and are an underachiever should you stick with playing for free. Zynga’s Farmville is a very popular game that users can play through Facebook as well as by downloading the app on their mobile devices. In Farmville, you can buy all sorts of virtual goods for real money. You can also advance faster through the game by purchasing credits and using them in game.

To put this in perspective, Facebook generates 12% of its revenue through commission on sales of virtual goods in Farmville. This translates into millions of dollars in sales for a simple application that runs on the Facebook platform.

Could this be check-mate for the gaming community or do they have another move?

I have been a Gmail user for a while now and I have always wondered how Google decides which ads to display to me when I am reading or writing emails.

After some research, I found out that Google scans email subject and contents for keywords. For example, I have been emailing my group members about a project we’re doing for a firm in the pet nutrition industry back and forth for a while. Now I keep on getting ads about dog care and nutrition. I do not have any pets and and not very interested in owning one, yet I get all kinds of ads that pertain to pet care and pets in general.

I think it is definitely a neat feature (excluding the privacy issues), but Google needs to do a better job in my opinion as I have not found a single useful ad so far.

Not that there is anything wrong with these pets…

I’m sure every one who has an iPhone or an Android phone has encountered ads while using free apps. For those who haven’t, this is what it looks like.

These ads are usually placed in a way that does not interfere with app navigation and are usually static pictures with text. From a consumers standpoint, we can’t complain; we downloaded an app for free and we use it as much as we want. The developers are probably making some money from either impressions or number of times someone taps the ad. I am personally okay with this sort of advertising.

Now, on the other flip side, I’ve encountered two tactics used by advertisers on apps that did not impressive me at all.

1. Ads are designed in a way to encourage impulsive clicks such as a Facebook message or notification alert. Once you click on it, you lose what you were doing with the app and the phone either takes you to the AppStore/Marketplace or opens a browser page with the advertisers content.

2. Ads are positioned very close to frequently tapped buttons in the app so it becomes a matter of probability of when you will eventually tap the ad.

These tactics puzzle me and I consider them to be very poorly designed and not well thought out. If someone is paying for each tap on their ad, chances are they are wasting their money on users who are not interested in what they are offering. Taking that into account, it seems as if someone is profiting from an ineffective advertising scheme.