Apple's iAd could generate $825M for developers this year
Apple's forthcoming iAd mobile advertising effort could yield developer revenues reaching $825 million this year, according to a research note published by Bernstein Research analyst Toni Sacconaghi. Estimating that iPhone developers presently generate $1 billion to $1.8 billion in annual App Store sales, Sacconaghi notes that iAd revenues will herald an annual increase between 40 percent and 80 percent. Sacconaghi anticipates Apple will collect about $815 million from iAd this year: $550 million from apps and $265 million from media providers like publishers and television networks. He adds Apple will generate roughly $58 billion in total worldwide sales this year.
In late April, The Wall Street Journal reported Apple is planning to charge close to $1 million dollars for mobile advertisements included in iPhone applications when iAd launches this summer. Citing ad executives briefed on the computing giant's plans, the Journal reports Apple could charge marketers as much as $10 million for inclusion in the first wave of iAd promotions when the service goes live on iPhone and iPod touch devices in June. By comparison, ad execs say they typically pay between $100,000 and $200,000 for similar mobile deals. The Journal adds that in addition to the exorbitant price tag, Apple is also demanding greater control over campaigns that run on the iPhone platform. Apple declined comment, but reiterated that developers will receive 60 percent of all iAd revenues, with Apple keeping the remaining 40 percent.
According to an email pitch sent to select developers by mobile advertising network Quattro Wireless, acquired by Apple earlier this year, iAd will boast features that "cannot be duplicated by any of [Apple's] competitors." TechCrunch reports the iAd effort will incorporate the new ViP (Verification of iTunes Purchases) Program for App Downloads, a real-time conversion tracking system that will tie the ad directly into purchasing data from iTunes. According to Quattro, ViP promises no APIs, no new SDKs or added code, adding there's "no need to wait until app is opened to know how your campaign is doing."
For more on iAd's future:
- read this Business Insider article
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