Apple Advertising Platform Praised

“iAds make it possible to communicate with users without interrupting them,” said Shravan Goli, President of Dictionary.com. In addition to "being relevant," that's likely one of the most important objectives an advertiser can achieve.

http://www.stockbriefings.com/apple-inc-nasdaqaapl-advertising-platform-praised/3171389

Apple Appears to Permit Google Ads Inside iPad and iPhone Apps

Apple Inc. doesn't appear to have barred Google Inc. and others from selling targeted ads inside iPhone and iPad applications, after implying several weeks ago that it might do so, according to the Wall Street Journal.

Software developers say their new and updated applications are getting approved by Apple, even though the apps are enabled to serve ads by third-party ad networks such as Google's Mobile Adsense and AdMob.

Every smaller firm that finds it has become a dominant firm, or is perceived as potentially dominant, will incure antitrust and other regulatory scrutiny. It might be that Apple and Google both must move more cautiously now that each is seen as reaching the threshold of dominance in existing markets that might be leveraged to attain dominance in new markets.

If the pattern continues, it will be good for advertisers, content owners and software developers, as they will have more freedom to pick their partners and keep more business leverage.

Nissan's First iAd Campaign

What are Advertisers Planning for iAd?

Campbell Soup is preparing at least one game for its iAd campaign. It's testing an idea to allow users to physically "shake" the salt out of different soups and see the results.

Mobile: A Look at Who's Getting What on Apple's IAds - Advertising Age - Digital

Apple Faces Another Antitrust Probe

U.S. antitrust regulators--it is not clear whether it is the Federal Trade Commission or the Department of Justice, are reported by the Financial Times to be weighing another investigation of Apple for restraint of trade, this time because of its plans to block rivals from access to its mobile app advertising network.

The ironic point is that regulators continue to bustle about, trying to regulate an access industry fighting simply to replace revenues it is losing, while the arguably-more-important gatekeeper decisions are being made by device and application providers, whose businesses everyone conversely expect will power the businesses of tomorrow.

The latest concern comes less than a month after concluded an  investigation of Google's purchase of AdMob. So powerful is Apple seen to be that the mere presence of Apple in the market with its own iAd network and a suite of "must have" devices was seen by regulators to be enough of a counterweight to Google that there was no risk of anti-competitive behavior.

According to the Financial Times, it is not yet clear whether it will be left to the Federal Trade Commission, which carried out the recent Google investigation, or the Department of Justice to take an investigation forward.

Apple’s latest rules about analytics for bar access to such information by competing ad platforms, third-party analytics firms or companies that compete with Apple in hardware.

Google is saying, and most observers agree, that the rules effectively bar Apple apps from using Google's ad network.

So consider the possible other implications. Perhaps in retaliation for its exclusion from the Apple application ecosystem, Google makes YouTube inaccessible from iPhones, iPads or iPod Touch devices. Or search, or other apps. You get the point: serious gatekeeping happens all over the Internet and broadband ecosystems these days.

Apple Will Bar Google (AdMob) From iPhones, iPads, iTouch Devices

Says AdMob CEO: Apple proposed new developer terms on Monday that, if enforced as written, would prohibit app developers from using AdMob and Google’s advertising solutions on the iPhone.  These advertising related terms both target companies with competitive mobile technologies (such as Google), as well as any company whose primary business is not serving mobile ads. This change threatens to decrease – or even eliminate – revenue that helps to support tens of thousands of developers. The terms hurt both large and small developers by severely limiting their choice of how best to make money.  And because advertising funds a huge number of free and low cost apps, these terms are bad for consumers as well.

Let’s be clear. This change is not in the best interests of users or developers. In the history of technology and innovation, it’s clear that competition delivers the best outcome. Artificial barriers to competition hurt users and developers and, in the long run, stall technological progress.

Since I started AdMob in 2006, I have watched competition in mobile advertising help drive incredible growth and innovation in the overall ecosystem.  We’ve worked to help developers make money, regardless of platform – iPhone, Android, Palm Pre, Blackberry, Windows, and others. In the past four years, AdMob has helped tens of thousands of developers make money and build real businesses across multiple operating systems.

I’ve personally worked with many iPhone app developers around the world, including one who created a fun and simple game in the early days of the App Store. He built the app because he was interested in the challenge. He built this single app into a multi-million dollar advertising revenue stream with AdMob, hired a whole team, and turned a hobby into a real business.

We see these stories all the time.  We want to help make more of them, so we’ll be speaking to Apple to express our concerns about the impact of these terms.

Will Apple Get 48% of All U.S. Mobile Advertising by End of 2010?

Apple CEO Steve Jobs predicts the Apple iAd network will get 48 percent of spending on mobile advertising in the United States from July through December of 2010.

That's a stunning prediction, given that total U.S. mobile advertising for 2010 is estimated to be about $593 million. Apple has about six months to get that done, starting from zero. Well, not zero.

Apple says it already has gotten commitments for about $60 milliion from  Nissan, Citi, Unilever, AT&T, Chanel, GE, Liberty Mutual, State Farm, Geico, Campbells, Sears, JC Penny, Target, Best Buy, Direct TV, TBS, and Disney.

Steve Jobs on Apple's iAd Network

Steve Jobs talks about the iAd network at "All Things Digital."

Google and Apple Likely to Dominate Mobile Advertising

Apple’s ownership of mobile advertising firm iAd gives it advantages over any other advertiser wishing to place ads on iPhone OS devices such as the iPad, iPhone and iPod Touch.

Apple, for instance, can harvest data about how such ads interact with items for sale in the iTunes store that other ad networks cannot access.

Google will be able to do the same on Android OS devices, but the stability of its legacy business has to be questioned, given that much AdMob traffic is generated by iPhones and other Apple devices. Over time, much of that traffic, perhaps all of it, will migrate to iAd, Apple's network.

AdMob’s success to date on the iPhone platform is unlikely to be an accurate predictor of AdMob’s competitive significance going forward, the Federal Trade Commission has concluded. Still, AdMob does essentially triple the number of mobile ad formats Google can sponsor. In addition to search ads, Google now will expand into display and "in application" advertising.

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Will iAd Lead to Rapid Rearrangement of Mobile Ad Network Rankings?

Google, at the moment, runs the biggest U.S. mobile advertising network while Apple currently ranks about seventh.

Apple certainly does not expect to remain seventh, and most observers likely believe Apple will ultimately rise up to the top ranks.

That might happen faster if AdMob clients shift over to the iAd network, since the iPhone now accounts for the majority of AdMob revenues.

It wouldn't be unusual if Apple and Google found themselves in the top-two spots before long.

Apple's iAd Shooting for the High End in More Ways than One

The conventional wisdom likely is that the new Apple iAd network is going to be positive for mobile advertising, showcasing what can be done with rich media on an easy-to-use device with a large screen.

But iAd might have another effect: driving up ad pricing double to triple current rates. That might be welcome for ad sellers, but not for buyers.

Since Apple never likes anything but the "premium" position in any market where it competes, that might not be too surprising.

According contentSutra, iAd cost per thousand impressions will be highly variable in terms of cost, but in some cases could wind up being triple what marketers are used to paying for banners, and double the price of a video ad on mobile (click on the image for a larger view).

In other cases, a very successful campaign that generates an unusual number of clicks could wind up being more than seven times what an advertiser had anticipated.

Keep in mind that Apple is setting the minimum annual spend at $1 million for brands to use its iAd platform. To put that in perspective, consider that Jaguar and Land Rover in 2009 spent about  $1.6 million in aggregate for mobile marketing.

Some advertisers might decide they like the iAd formats, and start shifting lots more money into mobile advertising. Others will push back against the price and take a wait-and-see attitude. Either way, iAd is going to have complex impact. It likely will spur larger mobile advertising commitments from some buyers more concerned with cutting edge than return on investment. Most will watch and see what happens, at least in terms of the high-end, showcase content Apple wants to show it can produce.

Apple Calls the Tune, Again

Apple might not yet have remade the notebook or netbook business, and might not have conclusively proved there is an undiscovered new consumer electronics niche for tablet devices, but it has caused Microsoft to kill its existing slate project, known as "Courier."

Microsoft’s Courier originally was conceived as the tablet of the future, Microsoft’s answer to Apple’s iPad, with two screens. Apple might disagree that the iPad is a "big iPod Touch," but Microsoft apparently has concluded that a two-screen device with a book style form factor is not what the market will want.

Perhaps the bigger deal, perhaps obvious in retrospect, is that although the device would have been "touch" capable, it somehow fails to offer an experience similar to the iPad. Make that one more case of Apple disrupting the conventional wisdom about user experience and user interface. And it apparently hopes to do the same in the mobile advertising businesss.

Apple never likes to play at the low end of any business, so we should not be surprised to see Apple taking that tack as it attempts to show what its iAd network can do on devices such as the iPad, iPhone and iPod Touch.

Apple also is famously "controlling" about the "user experience," so you should not be surprised to hear that Apple is making "initial demands for greater control over advertisers' marketing campaigns."

According to the Wall Street Journal, Apple is looking for placements priced about an order of magnitude (10 times) higher than is typical.

If you recall the demo Apple put together for its iAd announcment, you can understand why: Apple is aiming for content-rich campaigns that may involve branded characters and expensive production.

Apple Inc. aims to charge close to $1 million for ads on its mobile devices this year and perhaps even more--as much as $10 million--to be among the first participants.

Ad executives say they are used to paying between $100,000 and $200,000 for similar mobile deals.

Obviously, Apple is attempting to pull off a couple "hero" campaigns that likely cannot be replicated too widely in the future because most campaigns will not be able to afford the high rates.

One example Apple has been showing advertisers is an ad for Nike's Air Jordan basketball shoe.

When a user is in an application, an animated banner ad appears on the border of the screen, along with an iAd logo. If the user taps on the ad, it expands across the screen, displaying a video, an interactive store locator and exclusive offers at local stores, among other features.

Apple is planning to charge advertisers a penny each time a consumer sees a banner ad, ad executives say. When a user taps on the banner and the ad pops up, Apple will charge $2. Under large ad buys, such as the $1 million package, costs would rack up to reach $1 million with the various views and taps.

Marketers will be able to target ads to groups of users based on consumers' download preferences from its iTunes store, according to ad executives. For instance, a marketer could choose to show its ads to people who have downloaded financial applications or reggaeton music, horror movies or comedy TV shows.

Marketers also will be able to target ads to users in a general location like a city, although they cannot target ads to individual consumers or access personal details.

Apple is seeking high quality ads from big-name marketers for the launch, ad executives say. The ads will go through an approval process, and Apple will build the ads itself during the first couple of months to make sure they work well and attain a certain aesthetic and functionality, ad executives say. Eventually, Apple plans to create a developer kit so that agencies will be able to design and create the ads themselves.

The process is causing tension among some ad directors, who are hesitant to give up control. Welcome to Apple's world.

Apple iAd Wants to Change "Ads that Suck"

It isn't clear whether the typical mobile ad created for Apple's new iAd network will be as immersive and interactive as the example Apple CEO Steve Jobs shows here.

But the example suggests what Apple would like to see happen: ads that are closer to entertainment than anything we've seen so far, incorporating interactive and gaming experiences, for example. To use the obvious analogy, today's ads are outside the content; in the "Toy Story" example the ads are part of the content, essentially.

The issue will be how talented advertisers will be, not so much Apple. Unless firms are willing to allow Apple to produce the "creative," as well as handle the placement, it is doubtful most ads will be this well done.

"Most Mobile Ads Suck," Says Steve Jobs

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.