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Will iAd become a developer Gold Mine?

The Wall Street Journal reported earlier this morning that Apple plans to spend over $1 Million buckaroos on advertisements (iAds) this year. Advertisers are gonna have to pay top dollar to even think about delivering content to Apple’s users, plus create Apple approved experiences that aren’t (putting it lightly) garbage. But what does this mean for App Store customers and developers?

The benefit to developers is that they don’t have to rely on ads by The Deck or Fusion to fuel their profits. Instead, developers can start implementing iAds that will generate what I consider a healthy profit. Jeremy Olson (@jerols), the creator of Grades, did the math:

”[…] premium means charging one cent per impression and $2 per tap (for us developers that means .6 cents per impression and $1.20 per tap)…

With iAds, 10k impressions = $60 sure cash. Then, assuming there is a 1% tap-through rate (which I think is extremely conservative), that’s 100 users tapping the ad, that’s $120. So that’s $180/ day total. Okay, so thats not going to make me a millionaire but I think these are pretty conservative estimates and that is a good $64k a year.”

I really love Apple’s approach, as it’s a win for users who get to enrich their iPhone experience by downloading free applications, and for developers, who still get paid through iAd. If iAd is good enough, people will be very interested in checking out promoted products. Be sure to read the rest of Jeremy’s thoughts on his blog, Tapity.

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