updated 09:50 am EDT, Mon April 2, 2012
Company struggling to make iAd relevant
As previously expected, Apple has announced an increase in iAd developer payouts from 60 to 70 percent. The change took effect April 1st, and was signaled by a memo sent to developers over the weekend. The iAd pay ratio is now equivalent to the App Store, where Apple claims a 30 percent cut of revenue.
The shift is believed to be less generous than a way of compensating developers for lower ad rates, and attracting new advertisers where possible. iAd has struggled to compete with other mobile ad networks; whereas iAd is restricted to iOS devices, alternatives like Google's AdMob are cross-platform, reaching a wider audience. iAd was also originally burdened with a high minimum spend, but that amount has shrunk multiple times in the past two years. More recently Apple dropped per-click fees from ads in favor of impressions.
iAd was originally positioned as a high-profile platform meant to attract mainstream advertisers, who were expected to spend millions of dollars. Companies began complaining about Apple's strict requirements and involvement in the development process however, and some major clients fell away. Interactivity was positioned as a major element, but relatively few ads take advantage of it.