Apple has restructured its growing iAd division to focus heavily on selling spots for iTunes Radio, according to a report from AdAge. To help sell individual ads to more potential buyers, the company is also reportedly building a real-time bidding exchange for in-app iAds.
At a recent staff meeting, Apple’s Eddy Cue reportedly communicated that iTunes Radio was the “top priority” for selling iAds. “The message that came across was basically if you’re not working on iTunes Radio, you’re irrelevant,” according to an AdAge source. Apple makes 90% of the revenue off its audio ads and only has to give 10% to advertisers. The company recently hired a top-level radio exec from Cumulus Media to help negotiate big deals.
Before iTunes Radio, iAds were only designed for developers to put in iOS apps, but they never really took off. Apple charged a steep premium and was highly selective in selecting ad partners initially, but this recent report suggests that the focus is being shifted to cheaper ads that can be bought individually. The real-time bidding system would work similarly to the stock exchange. In-app iAds could not only become more affordable, but more specifically targeted at users.