Apple announced the upcoming Apple OS 4.0 yesterday. The new OS will enable users of Apple devices to perform mutlitasking, and a bunch of other new things. Here’s a webpage summarizing the announcement and the new features that will soon be available to ipod, iphone and ipad users. Note that only iphone 3gs, ipod touch and ipads will be able to run the new OS in its entirety. So if you have an older generation ipod or the iphone 3g, you’ll have to buy a new device if you want to use some of the new features.
Here’s what really worries me, though. They are introducing what’s called iAD. In other words, the good people at Apple want to shove advertisements down our throats at the rate of one add every three minutes! :raspberry: :fume:
Jobs:
-The average iPhone user spends 30 minutes a day running iPhone apps.
-If you put an ad in every three minutes, you get three ads every 10-minute period.
-We will have shipped 100 million iPhone/iPod Touches by this summer.
Add those up and you get a billion impressions a day based on that average use.
Are they out of their mind or what?
If I understand correctly, this feature enables apps developers to program advertisements within the applications. So in the future, when you open up applications, you will be bombarded with an average of one add every 3 minutes. We can expect that some applications will be worse than others, and we can also speculate having to pay more for apps that will guarantee no advertisement because that is how the developers will make their money. The more people download an application, the more money they will get from the businesses advertising within the application.
I can see free apps trial versions becoming cluttered with useless annoying life-sucking adds. Just what we need…
this is already happening. i mean go get the free version of words with friends and see how long you can deal with the ads before you decide to pony up the 2.99 (a price which actually gives some insights into what the developer believes the NPV of their ad revenue stream is for life of game).
iAds is to compete with goog’s ad network, which with their purchase of admob permeates everything.
this is fair competitive tactic by aapl. shafting adobe and every flash developer who was already mucking around with cs5 to deploy games apps into the app store, tho is just plain dirty. in many ways aapl has basically fully declared war today.
shit, i wouldn’t be surprised if apple decides to partner with microsoft and make bing the default search engine come the summer iphone release.
A company that makes money selling hardware wants you to buy an incremental upgrade. I’m not sure where the surprise factor here is.
Before iAd (so original, btw), app developers were already using Admob and other advertising/analytic sdks. There is nothing special or surprising here except that this is obviously an attempt by Apple to get into the mobile ad game after Google acquired Admob. In case I need to spell it out for you: it’s really a desperate catch-up play on Apple’s part.
[quote=“jashsu”]
A company that makes money selling hardware wants you to buy an incremental upgrade. I’m not sure where the surprise factor here is.[/quote]
“Bill Gates is a very rich man today… and do you want to know why? The answer is one word: versions.” Dave Barry
[quote=“RobinTaiwan”]If I understand correctly, this feature enables apps developers to program advertisements within the applications. So in the future, when you open up applications, you will be bombarded with an average of one add every 3 minutes. We can expect that some applications will be worse than others, and we can also speculate having to pay more for apps that will guarantee no advertisement because that is how the developers will make their money. The more people download an application, the more money they will get from the businesses advertising within the application.
I can see free apps trial versions becoming cluttered with useless annoying life-sucking adds. Just what we need… [/quote]
As has been pointed out, this isn’t different from what is happening already. The only difference to the end user is that you will have a different type of ad coming out - supposedly one that is more engaging with mini games and such. I don’t think you will see any less or more ads than you currently do in free apps.
There are already free aps or trial versions out there with ads in them, and I delete them as soon as I see they have them. While I might pay for an ad-free app, I will not buy apps that have in ads in them, simple as that. I get enough spam mail and SMS as it is without being bombarded with this crap.
I imagine someone will come up with an ad-blocker app soon enough, though I wouldn’t expect to see it in the app store.
A company that makes money selling hardware wants you to buy an incremental upgrade. I’m not sure where the surprise factor here is.[/quote]
I’m sure their percentage of revenue coming from the software (and now ads) side has been increasing over the past few years. So you would think it would be in their interest now to balance profits from hardware sales, with maximizing unit sales to increase software / ad revenue in the future.
[quote=“redwagon”]There are already free aps or trial versions out there with ads in them, and I delete them as soon as I see they have them. While I might pay for an ad-free app, I will not buy apps that have in ads in them, simple as that. I get enough spam mail and SMS as it is without being bombarded with this crap.
I imagine someone will come up with an ad-blocker app soon enough, though I wouldn’t expect to see it in the app store.[/quote]
There are various ways that developers can make money from apps now:
Charge up front for the app.
Have a free app with ads.
Have a free app that is a trial version of a paid app. If the user likes the features, he can pay for the full version.
Have a free app, with additional paid features available (in-app purchase).
Have a free app that promotes services elsewhere. Eg. If you like the content of an app, you may visit the developer’s website to purchase services there.
As consumers, you can choose which model you prefer to be marketed by.
it’s actually not too much work to figure out that aapl is still by and large a hardware company.
it’s well known that apple barely makes a profit with itunes.
if you take how many apps are in the app store, the number of downloads total, the average price (taking into account all the free apps, it’s probably less than 1USD), and apple’s 30% take, then factor in 99$ each dev pays to be part of the system, there isn’t much room for profit once you consider cost to test/approve and distribute the apps.
when the iphone first came out it was a phone, an ipod and a browser. that’s it. because they probably thought that’s all it needed to be. there was no app store and jobs kept professing the coming of the webapp. they even open-sourced webkit a few years prior as they were still building the g1 iphone. well, webapps didn’t really happen. the app store in a way created the apps. i’m sure you guys remember july 2008 and how every person who half knew how to code and their mom was busting a nut at this new place to sell apps to the (then) 6m people on iphones.
i think the ad network is not so much about profit as it is giving devs something to party on. owning it just gives them more control and hedges against any competitive response goog might do.
it’s about creating more value in their walled garden amusement park to sell more admission tickets (iphones, ipads, etc.)
[quote=“Adam_CLO”][quote=“redwagon”]There are already free aps or trial versions out there with ads in them, and I delete them as soon as I see they have them. While I might pay for an ad-free app, I will not buy apps that have in ads in them, simple as that. I get enough spam mail and SMS as it is without being bombarded with this crap.
I imagine someone will come up with an ad-blocker app soon enough, though I wouldn’t expect to see it in the app store.[/quote]
There are various ways that developers can make money from apps now:
Charge up front for the app.
Have a free app with ads.
Have a free app that is a trial version of a paid app. If the user likes the features, he can pay for the full version.
Have a free app, with additional paid features available (in-app purchase).
Have a free app that promotes services elsewhere. Eg. If you like the content of an app, you may visit the developer’s website to purchase services there.
As consumers, you can choose which model you prefer to be marketed by.[/quote]
Well put! BTW, Chris Anderson’s “Free” is probably the best book to date on “freemium”, “3-party free”, and internet “1. Collect Underpants, 2. ?, 3. Profit” business models in general. This and “The Long Tail” are two of my favorite books of all time.
True to what he talks about in the book, Free is also a freemium model. The unabridged audio book is free: audible.com/adbl/site/produc … Cookie=Yes
(the abridged version is pay-for). At one point, the eBook was also free.
[quote=“mabagal”]I think the ad network is not so much about profit as it is giving devs something to party on. owning it just gives them more control and hedges against any competitive response goog might do.
it’s about creating more value in their walled garden amusement park to sell more admission tickets (iphones, ipads, etc.)[/quote]
If what you say that Apple will not make much money off of iAds is true (and I don’t think it is), then that’s really all the more reason to believe that this is basically a vindictive strike against Google for horning in on their smartphone joy with Android.
having an iphone without an all you can eat data plan is like putting crappy gas in a ferrari.[/quote]
I had a 500MB data plan with my iPhone 3G until I got my Nexus One and I never went over once. Mostly hovered around 200-300MB. Even tethered too. Granted, I wasn’t downloading apps music or podcasts left and right on my phone and I didn’t run radio streams but with WeatherIcon, push notifications enabled for 2 apps and 2 push mail accounts (had MobileMe and GMail via Exchange), I really didn’t consume a whole ton of data.
Plus, unless your motor pings when you put lower octane count gas in there is no real harm running cheaper gas.
having an iphone without an all you can eat data plan is like putting crappy gas in a ferrari.[/quote]
I had a 500MB data plan with my iPhone 3G until I got my Nexus One and I never went over once. Mostly hovered around 200-300MB. Even tethered too. Granted, I wasn’t downloading apps music or podcasts left and right on my phone and I didn’t run radio streams but with WeatherIcon, push notifications enabled for 2 apps and 2 push mail accounts (had MobileMe and GMail via Exchange), I really didn’t consume a whole ton of data.
Plus, unless your motor pings when you put lower octane count gas in there is no real harm running cheaper gas.[/quote]
ymmv on the data. but, most every iphone (and especially android) user i know has gone well over 500mb just from tweeting/foursquaring/facebooking/goog mapping/reading news feeds/browsing, picture and video sharing, and (in the usa) pandora.
actually, lower octane does matter because even before the motor pings any decent, modern, knock-sensor-equipped control system is going to cut back a whole boat load of timing, and thus, power and performance. and any decent performance engine management system is calibrated near the knock limit of the recommended fuel.
[quote=“jashsu”][quote=“mabagal”]I think the ad network is not so much about profit as it is giving devs something to party on. owning it just gives them more control and hedges against any competitive response goog might do.
it’s about creating more value in their walled garden amusement park to sell more admission tickets (iphones, ipads, etc.)[/quote]
If what you say that Apple will not make much money off of iAds is true (and I don’t think it is), then that’s really all the more reason to believe that this is basically a vindictive strike against Google for horning in on their smartphone joy with Android.[/quote]
i honestly don’t know what the mobile cpm/cpc rates are right now, but like i said re: games doing upgrades to no-ads for 2.99ish and them promoting this actively in-app, there is a signal that it is low. basically the dev is saying the NPV of their ad-revenue over the active life of the game is 2.99 minus the value of immediate operating cash to them… or less. granted the active-use life of a game is relatively short, but it’s still an important signal.
that said, aapl will make profit off this, i never said they wouldn’t. just not sure how much. regardless, app developers (and ad buyers) get to party on more device state and user-specific info in their ads. aapl doesn’t have direct access to g-mail and all the other g-apps on the phone to have a bot read and tune ads with, so this is their way of getting some of that. this is also a way to empower them to attract devs to iphone over android once android’s march down-market goes far enough to start really eating into install base share.
importantly also, this also effectively shuts goog out of iphone ad serving, as long as aapl makes this more attractive than using say adwords or admob. and to do that, they may have to play on price, which as we know is a great way to pull profit down to zero or negative with a quickness. i dunno, maybe apple can figure out how to drive up mobile cpm/cpc, but that is a big if.
btw, this is a good post by bill gurley of vc hummer wimblad that gives insight how goog is in a way forcing apple’s hand here, by beating them to “less that free”: abovethecrowd.com/2009/10/29/goo … ess-model/
Could you explain this a little more? I don’t follow how selling to both high and low end means a smaller market share, if that is what you mean.
Or they could just ban admob at the app approval process. It sounds stupidly regressive now, but you never know with Apple. They did after all just announce they are going to start turning down approval for native objective c apps that were compiled from flash. I’m sure slowly taking away a developer’s allowed tools and increasing the ambiguity of what is approved and what is not is going to go over just fine.
Edit: by the way the linked article was a good read; thanks.
Could you explain this a little more? I don’t follow how selling to both high and low end means a smaller market share, if that is what you mean.[/quote]
sorry i should have wrote - eat into “apples install base share”.
in a few years, every other phone will be a smartphone. maybe more. what i mean is that right now install base and single (or a least low number) of platforms is what draws devs to iphone. android is driving down market fast so that anyone who wants a smartphone and can’t or doesn’t want to pony up $199 USD (us contract upfront) or $25k TWD (pre-pay upfront) can probably soon get a “free” android. sharks go where the fish are.
iAd is another weapon that apple has to continue to attract developers if android does indeed successfully eat more of the growing smartphone pie. apple is better equipped and positioned to fight with iAd than to sell cheapo-versions of iPhones also note that Jobs talked today about “great demographics” [of iPhone users])… implying that having richer-than-normal, and thus more attractive to advertiser demographics on its expensive devices is something the company values as part of their overall strategy.
i think we’re both thinking the same thing here, i just said it not so clearly.
edit: i should also note that aapl is skirting pretty close to anti-trust waters here. note the ibooks app is not shipped with ipad stock and the kindle app is allowed to exist. so shutting out admob explicitly could be a problem for them on that front.
i should also note that one reason i am posting so much today is we just fucking nearly vomited at the flash compile announcement. we are two weeks into something going exactly that way. i am now rebuilding and installing the sdk on the macbook i had sitting in the corner.
:raspberry: :fume: