Microsoft is set to roll-out TV-style advertising for Xbox Live, with 15-30 second spots set to run within TV and video apps.

The deal also confirms new channels coming soon to US gamers, including anime-streaming from Manga Entertainment.

"With the growth of Xbox Live, advertisers no longer have to choose between digital and TV advertising - we're offering the impact of TV and the interactivity and addressability of digital in one platform," said Microsoft's Ross Honey, general manager of Xbox Live Entertainment and Advertising.

"As more and more industry leaders like ESPN work with us to help monetize their content on Xbox Live, TV media buyers win with the ability to extend their standard TV spots to this highly engaged consumer audience."

Microsoft has recently enjoyed a huge increase in advertising revenue from Live. The service has earned Microsoft 142 per cent more ad cash since 2010.

US Gold subscribers now spend an average of 84 hours a month signed in to Xbox Live, with entertainment app usage recently surpassing online multiplayer gaming for the first time.

http://www.eurogamer.net/articles/2012-04-25-microsoft-to-launch-tv-style-adverts-on-xbox-live

I really, really hope this doesn't become the new norm next generation. 

Eh, if you don't allow a company to monetize a service, eventually they're going to discontinue it completely, or remove a lot of functionality from it at least.

Even in Netflix or Hulu Plus which already has ads? :(

Now this..................I am not a fan or MS.

Though I can't say its surprising, hell MS and Sony will probably do this next gen.

Still totally sucks though.

No other online game services I use thus far have done this, so at the moment Live is the exception to this 'rule' you've put forward. 

Do all other online game services have the same scale and costs as XBox Live? I'm not disputing whether or not MS is making a loss or not, but I don't think your logic is really sound.

We have to pay for XBL, this is wrong and completely inexcusable. Even satellite TV providers don't have advertisements on their channels. Oh well, it's a good thing I don't use TV apps on consoles.

Sounds like that monetizing resume thing we heard about recently.

No other online game service charges you a subscription fee to let you host your own games while bombarding you from orbit with ads, for sure.

According to Wikipedia-linked articles, Sony announced at GDC that there are 90 million registered PSN accounts and Microsoft announced at CES that there are 40 million subscribers to Xbox Live. 

Of course, Sony's numbers will also include duplicate accounts, but I can't see that being anything over an extra 15 or 20 million. 

Oh, and Steam has 40 million active user accounts.