On iAds

After reading a few of the overviews of the iPhone OS 4 event, I got a chance to watch it for myself — on my iPhone, on a 3-hour train ride across Japan (I love technology). While multitasking is obviously the eyegrabbing headline, it was another announcement that seems far more significant: iAds.

To be clear, iAds is not a sure bet at all. But that’s the thing. It seems like it will either be a complete failure or an absolute home run. And if it’s the latter, it could mean a huge new multi-billion dollar business for Apple. Remember that Google makes almost all of its billions of dollars in revenue each quarter from ads on the web. With iAds, Apple wants to grab that position in mobile.

Admittedly, I don’t know much about the ad business, but some of what Steve Jobs said on stage today absolutely rings true. Namely, that mobile ads “suck.” They do suck. Frankly, I think almost all online ads in general suck. They’re lame. I mentally block out almost all of them without even realizing it. With 99.99% of them, I would never be tempted to click. With iAds, as Jobs demoed today (through mock-ups), I would be tempted to click.

The only ads I ever click on are occassionally a Google sponsored result at the top of the search page if I know it is actually what I’m looking for. Google ads on any other page? Never. I know their line is how the context of the page makes them relevant, but that has always sounded like bullshit to me. People like my mother click on them because they are tricked into thinking they’re actually a part of the content. Pure and simple. She’ll be the first to admit that. And she’s hardly alone.

The problem is that online ads really do suck. The show Mad Men does a nice job of highlighting this indirectly. Back in the 1960s, certain ads almost seemed like art. Compare any of those to a Google ad. Now wipe the vomit off of your face.

There are still good ads today (Apple, of course, has long had great ones), but they’re all still confined to television or print.

There are a number of reasons for this (the market is still maturing, etc), but one problem is that advertisers have all gotten drunk on a metric they’ve never had before: the click. It’s directly measurable, and so that’s all they care about. And what do people click on? Links. So most online ads are links. And, again, most suck. 

Apple hopes to infuse presentation back into the mix with iAds. Again, I don’t know if they can pull it off, but if they do, it will be another gold mine. A gold mine they keep 40% of (versus the 30% they keep from app sales and in-app purchases). That would be Big. With a capital ‘B’. As is, Billions.

Regardless of if it’s a hit or miss, iAds will force Google to step up its game for fear of its newly heated rival. And better online ads are better for all of us. If they improve and more money starts flowing through them, the entire web will bloom further than it already has.

Call it iCapitalism.

[photo: gdgt]

  1. shallanelprin reblogged this from parislemon and added:
    iAds definitely look very, very interesting. I kinda hope they take off :)
  2. parislemon posted this