Apple slashes iAd pricing again, boosts developer revenue cut to 70%

Apple (NASDAQ:AAPL) is once again slashing the minimum amount marketers must spend to roll out campaigns across its iAd mobile advertising network, concurrently boosting iOS developers' cut of revenues. "The iAd mobile advertising network provides a simple and compelling way to generate additional revenue from your apps," reads a brief post on the News and Announcements for Apple Developers webpage. "Now we're making it even better, raising your revenue share to 70 percent. The new revenue share goes into effect automatically on April 1 for all developers in the iAd Network." Apple previously awarded developers 60 percent of iAd revenues.  

AdAge first reported the iAd overhaul last week, stating advertisers must now commit $100,000 to launch an iAd campaign, down from the previous minimum of $400,000. When Apple first unveiled iAd in 2010, the company demanded a minimum $1 million campaign investment. AdAge notes Apple also is tweaking its billing formula: In the past, the company charged a fixed rate for every 1,000 iAd impressions and tacked on an additional fee every time a user clicked on the promotion, but will now bill only the cost-per-thousand rate.

The new pricing model follows weeks after Apple hired former Adobe executive Todd Teresi to lead the iAd effort. Teresi replaced former vice president of mobile advertising Andy Miller, who bolted Apple's ranks in mid-2011 to join venture firm Highland Capital; Miller previously co-founded Quattro Wireless, which Apple purchased in early 2010 for $275 million. The Quattro platform made up the foundation of the iAd initiative.

As of late 2010, iAd ran neck-and-neck with Google's (NASDAQ:GOOG) AdMob for control of the mobile display ad market, but as 2011 wound down, Apple slipped to third overall, falling behind Google at 24 percent and independent mobile ad network Millennial Media (17 percent) to grab 15 percent of the market, according to research firm IDC. Insiders say ad agencies are frustrated by Apple's high prices, inflexible contract options and demands for creative control, not to mention rich media formats optimized solely for iOS devices--by comparison, AdMob and Millennial Media campaigns run across multiple operating systems.

For more:
- read this AdAge article
- visit the News and Announcements for Apple Developers webpage

Related articles:
Report: Apple poaches former Adobe exec to head iAd 
Apple slashes iAd pricing as developer revenues dwindle
Apple cuts minimum iAd buy to recapture advertiser interest
Apple removes iAds from apps targeting children
Apple launches iAd Gallery app to showcase mobile ads

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