You can count on one thing whenever Apple does something new: it will always say the old way of doing things "sucks." And that's what Steve Jobs, Apple CEO, says about most mobile advertising, in introducing iAd, a new mobile advertising platform that will be built in to the new iPhone operating system, iPhone OS 4.0. In typical Steve Jobs fashion, the Apple CEO said "we think most of this kind of advertising sucks."
Apple tends to reshape just about every market it enters, so its entry into mobile advertising has to be noted. Just as signficantly, iAd is expected to provide a monetization vehicle for many developers of free apps for the Apple App Store, driving the apps business, not just marketing.
"When you look at ads on a phone, it's not like a desktop," says Jobs. "On a desktop, search is where it's at."
"But on mobile devices, that hasn't happened," says Jobs. "Search is not happening on phones; people are using apps."
"And this is where the opportunity is to deliver advertising is," he argues.
"The average user spends over 30 minutes every day using apps on their phone," he says. "If we said we wanted to put an ad up every three minutes, that's 10 ads per device per day." Assuming 100 million devices in the user base, that's one billion ad opportunities per day, Jobs noted.
"This is a pretty serious opportunity, but we want to do more than that," says Jobs. "We want to change the quality of the ads too."
"What we want to do with iAds is deliver interaction and emotion," says Jobs, and he undoubtedly is thinking about video and audio. Apple will keep 40 percent of ad revenue, and give developers whose apps host the ads 60 percent of ad revenue.
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