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Microsoft Brings ESPN, CBS Into Xbox Advertising Fold

ESPN and CBS Interactive's GameSpot and Last.fm have joined Microsoft's advertising program for the Xbox 360, which lets content owners place 15- and 30-second spots in video content distributed through the game console via the Internet.

Microsoft launched an upgrade to the Xbox 360 in December, which among other things added the ability to place ad spots on Xbox Live. The subscription service counts nearly 40 million active members worldwide.

"When we began offering ESPN content on Xbox Live in 2010, it was an entirely new way for fans to interact with ESPN," Eric Johnson, ESPN's executive vice president of multimedia sales, said in a statement. "The Xbox Live platform offers a TV experience with the accountability and interactivity of the Web -- all while reaching the right audience at the right time."

Under ESPN's agreement with Microsoft, subscribers of broadband providers that offer ESPN3.com are able to access hundreds of live sporting events as well as game replays and highlights on the Xbox 360 in HD through Xbox Live.

According to Microsoft, since 2010 advertising spending on Xbox Live has increased by 142%; the company did not disclose dollar figures for ad revenue. U.S. subscribers to Xbox Live Gold, which costs $60 per year, spend an average of 84 hours per month on the service. Usage of entertainment apps has more than doubled year over year, and now accounts for more time spent with Xbox Live than multiplayer gaming in the U.S.

Other new Xbox Live ad partners include Manga Entertainment and MUZU.TV. Those content providers join the previous roster of ad partners, including Sony's Crackle, MSNBC, TMZ, NBC's Today and UFC.

Microsoft expects the new run of TV apps inventory to be available in the summer of 2012 in select markets.

"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," Ross Honey, Microsoft general manager of Xbox Live Entertainment and Advertising, said in announcing the new partners.