GM of Microsoft's Massive: "Our research indicates that most gamers like advertising in the game because it adds to the realism. Imagine playing a Major League Baseball game with no ads behind home plate, next to the scoreboard or on the outfield wall - not very realistic. Now imagine the outfield with up-to-the-minute ads you just saw on television or read in a newspaper - the latest movie release, television show, or a new car model. That is much more realistic."
Funny. But the part about realism is tired. Games are not about realism, games are about immersion and suspense of disbelief, and that should be the benchmark -- whether the ads disrupt the immersive experience.
An interesting comment by a reader of a related ARS article: "In non-sports games, that's only true if you see both competitors ads. It'd be unrealistic to only see coke ads, and no pepsi ads. It'd be unrealistic to only see mcdonalds in a virtual new york and no burger king.