Quattro purchase, iTunes accounts could give Apple mobile ad advantage

Posted:
in iPhone edited January 2014
A new report alleges Apple hopes to shake up the mobile advertising business, as competition grows between it and search giant Google. One analyst believes the rift could even potentially lead the Cupertino, Calif., company to embrace its rival, Microsoft, for Bing search.



Profiling the similarities and differences between Google and Apple, BusinessWeek spoke with analysts and anonymous sources about the direction Apple is headed following its purchase of mobile advertising company Quattro Wireless. Sources told the publication that Apple co-founder Steve Jobs hopes to "overhaul mobile advertising in the same way they had revolutionized music players and phones."



Specifics at the moment are not known, but a number of potential approaches were offered: Apple could rely on user data collected through iTunes and the App Store, along with geo-location technology due to GPS in the iPhone, to create targeted, local advertisements that would be more relevant to consumers. The company could also utilize gimmicks, such as having users shake their iPhone to win a prize.



"Some developers have profited by embedding ads in their apps, but the payments tend to be insignificant since the ads are usually smaller, less effective versions of their Web banner forms," the report said. "According to a source familiar with his thinking, Jobs has recognized that 'mobile ads suck' and that improving that situation will make Apple even harder to beat."



Earlier this month, Apple and Quattro confirmed the purchase of the mobile ad company. Andy Miller, former CEO of Quattro, was named the vice president of Mobile Advertising at Apple, a new position for the company. The Waltham, Mass., company has a client list that includes Disney, Visa and Ford.



The price Apple paid for Quattro has not been confirmed, though it has been reported to be a $275 million investment. The purchase came months after Google bought rival ad firm AdMob, with which Apple also allegedly had discussions.



BusinessWeek speculated that Apple's experience -- and wealth of information about its customers -- through iTunes, combined with the purchase of Quattro, could make it a formidable force in the mobile advertising space. In 2007, Apple said it had more than 500 million active iTunes users. Currently, the mobile advertising industry generates only about $2 billion annually, but that is expected to grow.



"Apple has a vault of valuable data that can help drive an ad business," the report said. "It knows precisely which apps, podcasts, videos, and songs people download from iTunes; in many cases it has detailed customer information such as credit-card numbers and home addresses. That gives Apple a chance to blend advertising and e-commerce in new ways, particularly after the acquisition of Quattro."



And as the rift between Google and Apple grows, one analyst speculated to BusinessWeek that the iPhone maker could look to remove Google's presence entirely from its devices. Such a deal could place Microsoft's Bing as the search engine of choice on the iPhone, Jonathan Yarmis with Ovum said. Or, he said, Apple could opt to create its own search engine.



As Apple apparently looks to offer mobile ads that don't "suck," one unique iPhone advertisement from Medialets did gain some attention this week for its original approach. When selected, a banner ad for the band Vampire Weekend included in an iPhone application brings up a music video which users can "edit" by shaking the device, and each shake changes the footage. The advertisement will appear in the NPR iPhone application until Feb. 11.



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Comments

  • Reply 1 of 51
    MacProMacPro Posts: 17,881member
    "One analysts believes the rift could even potentially lead the Cupertino, Calif., company to embrace its rival, Microsoft, for Bing search."



    Get the guy a straight jacket now!
  • Reply 2 of 51
    davegeedavegee Posts: 2,765member
    Quote:
    Originally Posted by digitalclips View Post


    "One analysts believes the rift could even potentially lead the Cupertino, Calif., company to embrace its rival, Microsoft, for Bing search."



    Get the guy a straight jacket now!



    If this is true and I do have my doubts then...Yea, thats right everyone... sip the koolaid and chant Google is BAD .... Microsoft is GOOD.



    And I have no doubt a good number of the totally contaminated people posting here would do so with a smile on their face.
  • Reply 3 of 51
    gazoobeegazoobee Posts: 3,754member
    Quote:
    Originally Posted by AppleInsider View Post


    ... "According to a source familiar with his thinking, Jobs has recognized that 'mobile ads suck' and that improving that situation will make Apple even harder to beat." ...



    No offence to Steve Jobs, but there is nothing in the known universe that can stop advertisements from sucking. Ads suck, they always have and always will.
  • Reply 4 of 51
    dreyfus2dreyfus2 Posts: 1,069member
    Quote:

    Apple has a vault of valuable data that can help drive an ad business," the report said. "It knows precisely which apps, podcasts, videos, and songs people download from iTunes; in many cases it has detailed customer information such as credit-card numbers and home addresses. That gives Apple a chance to blend advertising and e-commerce in new ways, particularly after the acquisition of Quattro."



    Yeah, and all these people would continue to be happy customers, paying the higher iTunes prices, if they are abused like that... I have spent over 5k EUR on iTunes since 2004. One single ad in my face - and I'm gone.



    I have some faith that Apple knows better than these tasseographists.
  • Reply 5 of 51
    mstonemstone Posts: 11,510member
    Quote:
    Originally Posted by Gazoobee View Post


    No offence to Steve Jobs, but there is nothing in the known universe that can stop advertisements from sucking. Ads suck, they always have and always will.



    Lots of ads do suck, but some are hilarious and others very informative.
  • Reply 6 of 51
    mactrippermactripper Posts: 1,328member
    Quote:
    Originally Posted by digitalclips View Post


    "One analysts believes the rift could even potentially lead the Cupertino, Calif., company to embrace its rival, Microsoft, for Bing search."



    Get the guy a straight jacket now!





    And the Thorazine too!



    This guy needs to comfortably numb in a hurry!



    I assume Apple is going to make a large audience with their new iSlate /e-Reader device and get a cut of the display advertising (not web advertising) from any newspapers or magazines hosted on the device.



    Competition with Google? Nah. But Apple might want a cut of Googles ads on the device.





    Apple also has the advantage of incorporating animated display advertising on the iSlate.



    So for instance your looking at the local used cars and they rotate in 3D, show the interior and what-not. Sure beats the pants off static ads.
  • Reply 7 of 51
    gazoobeegazoobee Posts: 3,754member
    Quote:
    Originally Posted by mstone View Post


    Lots of ads do suck, but some are hilarious and others very informative.



    Some ads are hilarious (while they suck), or informative (while they suck), is how I would put it. The basis of the modern advertisement is deception and behaviour control. I'm sure a lot of Guinea Pigs like their wheels too.
  • Reply 8 of 51
    Quote:
    Originally Posted by AppleInsider View Post


    lead [Apple] to embrace its rival, Microsoft



    Microsoft and Apple do not really compete with each other. They are way more complementary.

    Every Mac sold means more money for Microsoft than for every Windows PC sold.
  • Reply 9 of 51
    The ad creativity doesn't suck, but that band sure does.
  • Reply 10 of 51
    Quote:
    Originally Posted by Gazoobee View Post


    No offence to Steve Jobs, but there is nothing in the known universe that can stop advertisements from sucking. Ads suck, they always have and always will.



    Not necessarily ... look no further than Apples various campaigns to see examples of ads which can amuse or inspire.



    Definitely exceptions though.



    I DO always love it when Jobs starts trashing a category in the market or culture, usually means that an Apple initiative is in the offing.
  • Reply 11 of 51
    mstonemstone Posts: 11,510member
    Quote:
    Originally Posted by Gazoobee View Post


    Some ads are hilarious (while they suck), or informative (while they suck), is how I would put it. The basis of the modern advertisement is deception and behaviour control. I'm sure a lot of Guinea Pigs like their wheels too.



    I guess I'm biased since I am sort of in the marketing biz. But I would rather watch a solid hour of TV ads than 5 minutes of typical prime time drama. Some of the smartest people in the entertainment business are in advertising. Unlike most people, I often click the channel to find another ad when the scheduled program comes back on.
  • Reply 12 of 51
    ilogicilogic Posts: 298member
    "ads suck" - he's got the be one of the best CEO's ever...
  • Reply 13 of 51
    mactrippermactripper Posts: 1,328member
    Quote:
    Originally Posted by davebarnes View Post


    Every Mac sold means more money for Microsoft that for every Windows PC sold.



    Without Office?



    Like what in kickbacks or stock or something?
  • Reply 14 of 51
    irelandireland Posts: 17,528member
    Apple makes ads sexy, LOL
  • Reply 15 of 51
    rot'napplerot'napple Posts: 1,839member
    Quote:
    Originally Posted by AppleInsider View Post


    BusinessWeek speculated that Apple's experience -- and wealth of information about its customers -- through iTunes, combined with the purchase of Quattro, could make it a formidable force in the mobile advertising space. In 2007, Apple said it had more than 500 million active iTunes users.





    If they don't want ads to suck and they have information on me, then they know that whatever ad they thrust in my face better have something FREE, FREEEE!, FFRRREEEEEEEE!!!!





    Quote:
    Originally Posted by AppleInsider View Post


    Or, he said, Apple could opt to create its own search engine.





    Create your own search Apple! Call it MacMan-age!
  • Reply 16 of 51
    Sorry, I can't get past how aweful that music was to recall the story and comment... oh wait, it was on the NPR app... that explains the music selection.
  • Reply 17 of 51
    ifailifail Posts: 463member
    Internet ads are quite possibly the most ANNOYING thing ever, ive only ever seen a few good ones in my lifetime, there was a good Apple one on Youtube a few months ago with PC switchers going into the Apple store.



    Billboard ads like along the highway tend to catch your eye...usually because there is nothing but cement/trees/openness and a billboard just out there kinda forces you to look. I dont think they have the same effect in cities imo.



    TV ads that are done well make you want to watch them. The Apple ads are mostly rehash garbage now and AT&T putting Luke Wilson to combat VZW raping them hard in public perception is just terrible enough that i have to change the channel. VZW and the Droid commercials made a big splash, and Superbowl ads are probably some of the best you will see all year cause a lot more work is done into making them interesting.



    In short, not all ads suck.
  • Reply 18 of 51
    djsherlydjsherly Posts: 1,012member
    Quote:
    Originally Posted by mstone View Post


    Lots of ads do suck, but some are hilarious and others very informative.



    It's starting already. Soon Ads will be bearable because Apple's involved and in about 12 months there will be complaints that people aren't getting enough ads. Gotta hand it to Apple. They could sell ice to an eskimo.



    Gazoobee makes an interesting point about behaviour control. Owning Apple products is a shining example of it.
  • Reply 19 of 51
    Quote:
    Originally Posted by Gazoobee View Post


    No offence to Steve Jobs, but there is nothing in the known universe that can stop advertisements from sucking. Ads suck, they always have and always will.



    You're totally wrong . . . again. The "Get a Mac" ads are sheer genius and obviously quite effective, as Apple wouldn't have continued the series for YEARS if they weren't.



    And THAT qualifies this as as NOT sucking.
  • Reply 20 of 51
    Quote:
    Originally Posted by Gazoobee View Post


    No offence to Steve Jobs, but there is nothing in the known universe that can stop advertisements from sucking. Ads suck, they always have and always will.



    Amen.



    It's the intrusion of it, not the ad itself. I don't want to be paying for a service, product, movie, etc, and be subjected to advertising.
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