Apple cuts minimum iAd purchase price in half

Apple has cut the minimum purchase price for advertisers on its mobile iAd network from $1 million to $500,000 in an effort to appeal to smaller companies and help broaden the mobile advertising platform, according to All Things Digital.

The new entry point is $500,000, a significantly smaller commitment, particularly for smaller brands and agencies that are creating and producing their own iAds.

When Apple introduced iAds last year they thought it would be a huge success despite some believing it would be a flop, and although Apple is claiming over 60 successful iAd campaings so far they're also seeing low fill rates and other developer complaints.

Cutting the initial asking price in half should allow more eligible parties to participate in the iAd program, but do you think it will be enough to make iAds a full success for Apple? Let us know in the comments!

[Digital Daily]

Andrew Wray

Andrew Wray is a Salt Lake City, Utah based writer who focuses on news, how-tos, and jailbreak. Andrew also enjoys running, spending time with his daughter, and jamming out on his guitar. He works in a management position for Unisys Technical Services, a subsidiary of Unisys Corporation.

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Reader comments

Apple cuts minimum iAd purchase price in half

16 Comments

It's definitely a good start but I think cutting it to $125,000 would be ideal. Not too cheap to have low-quality ads but cheap enough to allow far more entrants.

Put iAds in the hands of the developers and stop holding it so close to the chest...that will make it a huge success. The only prob is Apple will have to loosen their grip on the dough end of things. :)
I liken this to iPhone 1. Was great but didn't go wild until developers got involved. Yeah...we [developers] rock! ;-)

Apple is just not good at services. They are wonderful at products. Horrible with services. I'd sooner see them drop iAd, mobile me and stuff like that and farm it out to people who really really care about it. Their heart isn't in it.

Dumb question: So if you want to advertise in apps with iAd, you pay apple 500 grand for them to allow you to and then you get $$ when people visit the add site?

@Shrike
Agreed, though I don't think it is so much Apple's heart is not in it as that their core strength and culture is ill-suited to being a service provider.
Apple's core strength lies in obsessive control over every detail. It allows them to make fantastic products, with a level of integration and polish far beyond the competition, but successful services require something different. Successful services have to adapt to the needs of the users, rather than dictate to the users what they will do. Obviously, if you hit the sweet spot right away, like the iTunes Music store, you are ok, but eventually, you miss just a bit. When that happens and your design conflicts with a significant set of service needs, you have to be willing to adapt your design to accomodate the users, even if it would be a compromise of some of your initial assumptions.
I'm not sure Apple has that level of flexibility in them.

The iTunes "service" I think is a case where they care a whole lot and have devoted significant resources to it both in the front end (iTunes app and store UI) and the backend (finance, server scale, OS updates, apps etc). I don't think such a thing (almost a decade of great stuff) is something you luck into. They earned it.
The whole iAd seems forced. It's not something they wanted to do, but thought it was a good idea to try carve out a slice of the ad services for iOS apps to ensure Google or some 3rd party can't dominate a big chunk of iOS app revenue. But ad services seem anathema to their mission. They're the company we pay a lot of money too to not have any of that crap-ware, badge-manic cruft on devices.
It would be much better if they were into that free services stuff. It could benefit their ecosystem and their strategic goals. They are the ones that should have bought youtube and flickr, not Google or Yahoo. They never should have let AdMob slip under their fingers. They probably should just buy Yahoo for Yahoo Mail. But this kind of stuff isn't them. They don't do low margin, service oriented stuff. Everything they do has to make money. Inflexible they are. Which is both good and bad.

I never meant to imply iTunes' succes was luck. Clearly, Apple earned it. However, I also believe they have honestly tried with iAd, but misjudged the market, and their corporate culture seems ill-equipped to adapt. It is not that Apple doesn't do low margin stuff, it is that Apple expects customers to adapt to them, rather than the other way around. This can be a strength in product design, but it is deadly for a service provider. There is an old adage in protocol development, Postel's law, which reads:
"Be conservative with what you send, and liberal with what you accept."
In other words, be very specific with what you offer your partner, and figure out ways to handle their idiosyncrasies. The most successful services do this every day, and it keeps their customers coming back for more. In business speak, you might consider it "The Customer is Always Right" principle.
Apple does not believe customers are right; Apple believes Apple is right. With their exquisite product sensibilities, they have made millions designing according to a singular vision. To maintain this vision, they have doubled down educating consumers, and, in some cases, forcing partners to play the game purely according to Apple's rules. However, as successful as that approach has been for products, it does not fly in the service industry. If your customers demand A, and you tell them they are wrong, they really want B, sooner rather than later your customers will stop coming back for more. This is what Apple has done with iAd, and it shows in the lackluster inventory post initial runs ( http://tcrn.ch/fMfzpF ).
If Apple wants to succeed as a service provider, they have to abandon the obsessive vision and control principles that so benefit their product side, and embrace what their service users tell them, or their services will not succeed no matter how hard they try.
tl;dr Apple is trying with iAd, but they are trying to tell their ad customers what they want, rather than listening to what their customers say they want.

While I like the iAds I've seen, I think Apple do need to loosen their grip on it. I don't agree with those saying Apple need to drop services, MobileMe is great for those who have used Google Apps but just want something that works and is seamless. I just feel that Apple sometimes fail to realise that services are unable to grow and suceed under a choke hold grip that they often put them in.

I've never seen an iAd. Don't want to see one. They are a negative value proposition for iPhone users (use bandwidth, waste time). As bandwidth becomes more and more metered users will become more militant about blocking ads. If your app has ads I don't need it.

So Apple is making it more expensve to deliver content to users by introducing that subscription service, while at the same time making it cheaper to spam them with iAds? From a user perspective, I don't like the direction they are taking at all.