Apple Cuts iAd Prices

Apple has cut prices on its iAd mobile ad platform, perhaps in response to the announcement of AdMob pricing changes. Launched as a showcase for interactive rich media ads in July 2010, campaigns were originally priced starting at $1m – with the cuts, the threshold has dropped to $100,000. These arent the first price drops iAd has seen – the minimum was cut to $500,000 in February 2011, and then to $300,000 for advertisers.

App developers, meanwhile, will receive a 70 per cent of ad revenues from iAds running on their apps, up from the previous figure of 60 per cent. The previous pricing model – which charged a fixed rate for every 1,000 ad impressions plus an additional fee every time a user clicked on the ad – has also been changed, dropping the additional fee in favour of just a cost-per-thousand rate.

These changes seem intended to incentivise businesses to build their ads on the Apple platform, which has been overtaken by Android in terms of audience share in the US. They could even be a direct response to Googles changes to the AdMob auction – iAds having come in response to Google outbidding the company for AdMob in 2009.