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Apple's mobile ad pacts pegged at $1m (or more)

'A hefty sum,' grumbles ad exec

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If you want to participate in Apple's new mobile iAd program, you'll need to pony up some serious coin.

According to a The Wall Street Journal report citing information from ad executives. A "person familiar with the matter" tells the paper that a first-round buy-in fee could be as high as $10m for the few select ad mongers chosen to participate in the service's launch.

iAd is the Apple-described "breakthrough mobile advertising platform" that Steve Jobs introduced on April 8 as part of the upcoming iPhone OS 4.0, scheduled for release this summer for the iPhone and iPod touch, and this fall for the iPad.

At its unveiling, Steve Jobs expressed high hopes for iAd: one billion ad impressions per day by the end of the year. But getting aboard that juggernaut will be pricey - far more than marketers are used to paying, which is in the $100,000 to $200,000 range, according to the WSJ.

"It's a hefty sum," one well-placed mobile-marketing exec told the WSJ. "What Apple is trying to do is certainly above and beyond what's been done in the past."

The ads themselves will also be different from existing mobile ads. Apple's iAd platform is built to host ads that use the full set of iPhone 4.0 APIs - an ad can therefore be indistiguishable from an app, with elements such as interactive games, videos, product customization, location awareness, accelerometer-based controls, and the like.

But don't think that those millions of buy-in dollars will buy ad folks creative freedom to use all those APIs: during iAd's first few months of life, Apple will create the ads themselves.

"As a creative director, I can completely understand that they created this new baby and they want to make sure it gets born looking gorgeous," one high-powered creative director told the WSJ. "But as a creative director, I don't feel completely comfortable letting Apple do the creative."

Tough, Mr. High-Powered Creative Director - this is Apple, remember? You want to play in their sandbox, you gotta accept their rules.

Apple will "eventually" release an SDK so that creatives can build their own ads, but even then those ads will be subjected to a review process. At iAd's unveiling, Jobs said that approvals - and disapprovals - will be handled with "a light touch," but offered no more details.

Those details may very well be released during the "Integrating Ads with iAd" sessions at Apple's Worldwide Developers Conference (WWDC), which is scheduled for June 7-11 in San Francisco.

One detail of iAd's powers is already certain, however. It has buoyed spirits at Google, which was under scrutiny by the US Federal Trade Commission for possible anti-competitive practices after its acquisition of mobile ad broker AdMob. Mountain View's CEO, Eric Schmidt, recently said that iAd is "evidence of a highly competitive market."

Maybe that's what Steve and Eric were talking about over coffee last month. ®

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