iAd

Apple announced their new iAd platform this weekend and on the surface it appears to be a great opportunity for publishers. First, it offers an alternative to Google AdWords – which many publishers blame for the rapid race to the bottom in internet ad pricing.

iAd works a bit differently than AdWords though. The platform is purely based on in-App advertising. This is also a good thing for publishers. It allows for hybrid business models – supported by a combination of subscriber revenues and advertising.

Basically, now publishers can offer iPad, Iphone and Ipod Touch subscribers a $19.99 App (or any price – renewed annually) and also serve targeted adds through  that App.

The real caveat comes from the “targeted” part of the platform. Apple is keeping control of all “device data.” Yes, publishers will be given certain data from Apple, but it is still unclear how much data. In today’s market advertisers want to know everything about their online ad placements – from click through rates to demographics to the type of beer your readers order.

Don’t get me wrong – the very existence of this platform is a huge step forward. By using a combination of subscription fees (via apps) and advertising publishers can service their readers and their advertisers much more efficiently.

In the end, iAd is a new business model and with any change like this there is a lot of uncertainty. The last time a major change came to the publishing industry, we ended up trading print dollars for digital pennies. From what I have read so far, iAd should reverse this trend and may be a more sustainable business model for print and web publishers alike.