Apple has confirmed it’s giving up on making money in the mobile advertising business, and it will shut down the app network for its six-year-old iAd program on June 30th.
The news follows reports that Apple’s plans to disband the division’s sales team due to poor adoption and small revenue share.
The announcement does not mean that all of iAd is being discontinued.
Developers can still show iAd banners in their apps, but inventory for App Store apps to advertise will no longer exist.
In a blog post dated 15 January entitled “iAd App Network will be Discontinued” Apple confirmed it will no longer be accepting new publishers on to the network as of the end of June this year, bringing to an end Apple’s six-year bid to firmly entrench itself in the advertising game.
“Although we are no longer accepting new apps into the network, advertising campaigns may continue to run and you can still earn advertising revenue until June 30,” reads the post.
“If you’d like to continue promoting your apps through iAd until then, you can create a campaign using iAd Workbench.”
The shutdown doesn’t come as a surprise. CEO Tim Cook referred to iAd in 2014 as a “very small” part of Apple’s business in a privacy statement, and the program captured only 5.1% revenue share of the mobile display advertising business last year, according to EMarketer.
The move will offer benefits and drawbacks to advertisers. It won’t help iAd improve its fill-rates but the CPM on these type of ads was significantly lower as the buy-in from the publisher side was also lower.
Apple hasn’t disclosed its future plans for mobile advertising, but the company is leaving open the possibility iAd will exist in some form down the line.
A recent Wall Street Journal interview with Apple executive Eddie Cue, as well as BuzzFeed’s report this week, indicate the company may transition the program to an automated self-service platform.
That way ad sellers and publishers will no longer use Apple as an intermediary, and hand over a 30% cut as a result, and instead interact directly and take 100 percent of the revenue.
Apple did not disclose any future plans for the program in its statement, but told developers it would keep them updated.