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Apple has altered the terms of its iAd agreements in a way that both developers and potential deep-pocket advertisers should find favorable, an Apple spokesperson told VentureBeat today.
iAd is Apple’s mobile advertising network. It places ad spots into iOS apps to generate revenue for the app’s developer.
Apple launched iAd back in June 2010, initially offering developers a 60 percent cut of the ad revenue generated. The company also initially required would-be advertisers to spend a minimum of $1 million per campaign, which was done to ensure that ads on the network were both high quality as well as lucrative for all parties involved. (In other words, no teeth whitening advertisements or click scams.)
Unfortunately for Apple, advertisers weren’t biting, as VentureBeat reported in December.
Yesterday, however, Apple announced new terms for iAd, which included giving developers an additional 10 percent cut of the revenue and lowering the minimum cost of an iAd campaign to $100,000 for potential advertisers, the company has confirmed. Apple said it listened to industry feedback from ad agencies, brands, and developers when restructuring the new terms.
The changes will go into effect April 1, 2012.
Apple said it’s hopeful the revised iAd terms will spark a renewed interest from developers. The new 70/30 percent revenue split Apple is offering is in line with the industry standards, so there’s a good chance more developers will be willing to deploy the company’s ad network on to their iOS apps.
Also, a greater number of advertisers are likely to do business with iAd now that the minimum commitment for a campaign is significantly lower.
We’re guessing the $100,000 minimum is still higher than many other competing mobile ad networks in terms of barrier to entry. However, Apple is attempting to push iAds as a better service and product much in the same way people feel justified in spending a little more money on Apple computers.
With more than 550,000 apps on the App Store and 315 million iOS devices sold, the iAds audience should catch the attention of potential advertisers.
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