The Wall Street Journal is reporting that Apple has lowered the purchase commitment for marketers interested in advertising with the iAd mobile service. When the service first launched, advertisers were asked to make a $1 million dollar commitment to the platform, which was later dropped to $500,000. Today’s report states that Apple has lowered that buy-in commitment yet again to $400,000 – a staggering %60 below the initial launch price.
This strategic move comes on the heels of Apple losing another 4% market share of U.S. mobile display-ad revenue according to International Data Corporation (IDC). In contrast to Apple’s decline, Google’s mobile advertising service AdMob, is doing quite well and has grown to 24% of the U.S. market share in 2011.
In response, Apple is making some changes. It is showing more willingness to bargain on the spending commitment it requires of advertisers.
The roll-out of iAds made quite a splash when it was first announced by former CEO Steve Jobs back in April of 2010. Since the launch, the results have been less than expected and Apple seems more determined then ever to turn the declining business venture in to a success. Their commitment to quality in-app advertising is also a key element in their plan to retain developers for the iOS platform. If iAds become a thriving mobile advertising service that developers could utilize in their iOS apps, then they would be less likely to stray to competitor platforms.
[via The Wall Street Journal]
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