Xbox One Paid Promotions: Microsoft Responds To YouTube Allegations

Microsoft recently responded to allegations that the company was offering money to YouTube video content creators to promote its next-gen Xbox One. A number of users have said they’ve received emails offering up to $3 per 1,000 views of Xbox One-related content.

Well-known game-video creator Machinima ran an endorsement that gave users a monetary reward for saying positive things about the Xbox One. Rumors of the promotion first appeared when a member on NEOGaf openly advertised Microsoft’s stipulations -- 30 seconds of gameplay footage along with only positive endorsements of its latest console. The agreement also said that Machinima would not pay any bonuses after users reached a collective 1.25 million views. Machinima UK confirmed the promotion in a tweet on Jan. 14 that was later deleted.

Redmond, Wash.-based Microsoft responded to the allegations that it was contacting YouTubers to promote the next-gen console, telling gaming site IGN: "Microsoft was not aware of individual contracts Machinima had with their content providers as part of this promotion and we didn’t provide feedback on any of the videos. We have asked Machinima to not post any additional Xbox One content as part of this media buy and we have asked them to add disclaimers to the videos that were part of this program indicating they were part of paid advertising."

Machinima also spoke to IGN, saying, "This partnership between Machinima and Microsoft was a typical marketing partnership to promote Xbox One in December. The Xbox team does not review any specific content or provide feedback on content. Any confidentiality provisions, terms or other guidelines are standard documents provided by Machinima. For clarity, confidentiality relates to the agreements themselves, not the existence of the promotion."

The Xbox One, which launched in 13 countries on Nov. 22, sold 3 million units worldwide before the end of 2013. The next-gen console, which hit shelves in Brazil, Canada, France, Germany, Austria, Ireland, Italy, New Zealand, Ireland, Mexico, the U.K., the U.S. and Australia during its initial release, was touted as an all-encompassing source of entertainment. Microsoft (NASDAQ:MSFT) reported that the console sold 1 million units within the first 24 hours of its launch. These sales figures evenly matched those of Sony’s PlayStation 4, which launched Nov. 15 and also sold 1 million units within 24 hours of its shelf date.

Though the sales numbers for Microsoft’s latest unit are impressive, Sony’s PlayStation 4 appears to be currently winning the console battle, with 4.2 million systems sold by the end of December, more than 1 million more than the Xbox One. As the race continues, only time will tell which next-gen device will prevail. Could this attempt be a stealthy marketing ploy on Microsoft’s behalf to gain the edge over Sony? With brands turning to less-traditional means of advertising, would using methods like this be fair in the future?

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