From visiting PadGadget, you may have noticed that, sometimes, advertisement space seems to directly reflect your recent Internet activity. For example, if you were just looking at socks on Amazon, you may see an ad in the sidebar for socks on sale on Amazon. This type of advertising is called real-time bidding (RTB) and it is used to better target visitors to a website and increase interest in the advertisement.
Google has been offering a service, called AdSense, to publishers on the Google Network that allows for interactive media advertisements based on RTB. According to a recent article from AdWeek, Apple is in the process of doing the same. The focus in 2014 will be on iTunes Radio.
According to AdWeek, Apple’s iAds team has been tasked with building a RTB exchange to automate selling in-app ads. The company’s head of software, Eddy Cue, told staff in a meeting that iTunes Radio is top priority and app ads are not. “The message that came across was basically if you’re not working on iTunes Radio, you’re irrelevant,” an unnamed source told AdWeek.
It is likely that Apple is trying to get ahead of the game in the mobile streaming music market. Pandora recently hired hundreds of new employees to the local sales department. Spotify recently introduced ad-supported mobile radio service to its app. Apple will need to work hard to compete with two companies who’ve been in the industry years longer if they don’t want to see iTunes Radio go the way of Ping.
Since iTunes Radio is available across all of the company’s devices, the RTB advertisement campaign would not have to be restricted to iOS. The company could potentially add real-time iAds to Apple TV and OSX Mavericks.
Considering that AdSense has profited Google billions of dollars annually, this might be a very good move on Apple’s part. The key now is getting Pandora and Spotify users to switch loyalties.