Apple to Allow Third-Party Mobile Ads, Just not Those from Google

Despite Steve Job’s promise to allow third-party networks to advertise within applications on Apple devices, it appears the offer will not extend to Google – its major competitor in the space – or other major companies in the mobile ad space such as Microsoft and Nokia.

Last week at the All Things D conference, Jobs said Apple will allow third parties to sell ads on applications on its devices. In line with that, Apple has changed the language of its developers’ license agreement to suggest the sending of application data to third parties is permissible as long as Apple gives its consent, and “The collection, use or disclosure…is provided to an independent advertising service provider whose primary business is serving mobile ads.”

However, the terms also state in parenthesis that, “an advertising service provider owned by or affiliated with a developer or distributor of mobile devices, mobile operating systems or development environments other than Apple would not qualify as independent.” By that definition, Google and its newly acquired mobile ad company AdMob would not be allowed to serve ads thanks to Google’s involvement in the operating system space with its Android product.

In response to the changes, AdMob CEO Omar Hamoui acknowledged on the company’s blog that the new terms would exclude Google, and argued the move would ultimately detriment developers and users.

“Let’s be clear. This change is not in the best interests of users or developers. In the history of technology and innovation, it’s clear that competition delivers the best outcome. Artificial barriers to competition hurt users and developers and, in the long run, stall technological progress,” he wrote.

However, according to the revised terms, Apple is not attempting to limit competition in the mobile ad space completely, it’s simply attempting to limit competition from parties such as Google. Meanwhile, other ad networks such as Millennial Media and Jumptap would remain free to sell and serve ads. Other companies in the mobile OS space such as Microsoft and Nokia, both of which are active in the mobile advertising space, will also be excluded under the terms, though.

According to a lawyer representing a mobile ad network in the FTC’s investigation into Google’s acquisition of AdMob, the FTC and the DoJ are currently discussing which of the two regulatory bodies will look at Apple’s practices in the mobile ad space more closely, following possible anti-competitive behavior.

In its statement regarding its approval of the AdMob acquisition, the FTC referred specifically to Apple’s developers’ terms, stating they afforded the company a “unique ability to define how competition among ad networks on the iPhone will occur and evolve.” Apple’s latest update to its terms appears to demonstrate exactly that.

Hamoui said AdMob will be “speaking to Apple to express [its] concerns about the impact of these terms.”

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