Apple is reportedly lowering the entrance fee for its iAd platform to US$500,000, a 50 percent reduction from its launch price of $1 million. This potential reduction would benefit smaller advertisers who can now afford to get their foot in the door of this mobile advertising platform.
Mark Read, CEO of marketing agency WPP Digital, echoes this sentiment when he says, "This new minimum buy is a great step forward and a necessary one, I think. Lowering the minimum buy to $500,000 from $1 million will certainly make the platform more appealing."
This rumored reduction may be tied to an earlier report that suggests Apple's iAd service is not performing up to Apple's expectations. The report claims Apple's iAd fill rate has fallen from 18 percent to a paltry 6 percent, primarily because advertisers are not willing to risk a minimum of $1 million on the nascent mobile advertising platform.
A drop in the minimum buy rate would attract new advertisers, especially since the ads are reportedly performing well for those companies that have signed onto the platform.