A report out of Washington says that the Federal Trade Commission [1] is planning to examine allegations that Apple Inc. [2] is engaging in anti-competitive behavior in the mobile advertising sector.
Just recently, Apple announced that it plans to launch a proprietary ad format, the iAd, for its iPhone and iPad devices. (See DailyDOOH June 8, 2010, article [3].) The iAd program generates revenue from ads placed on Apple’s handheld devices.
U.S expenditure on mobile ads is expected to rise to close to $500 million this year from $220 million in 2009, according to IDC [4].
According to financial site Bloomberg.com [5], regulators want to know whether moves by Apple will result in less competition in the growing market for ads on handheld computers and phones.
The FTC had recently approved Google [6]‘s $750 million acquisition of mobile ad firm AdMob [7], after delaying its decision due to concerns with conditions that Apple was placing on software developers and advertisers for the company’s iAd program.
Apple had at first released a set of terms that seemed to ban all third-party ad-serving networks, then altered the terms to reflect that independent third-party ad networks could be used by developers on the iPhone.
However, Apple said ad networks owned by a company that also sells mobile phones or mobile phone software, for example, Google and Nokia [8], are banned from the iPhone.
The FTC wants to investigate whether Apple is engaging in anti-competitive tactics to restrict rivals in the mobile-advertising market and or by prohibiting developers from using, for example, AdMob and Google’s advertising solutions on the iPhone.