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Apple's iAd Will Eat Into Google: Poll

The introduction of Apple's mobile ad platform is poised to eat into Google's position in the space, investors say.



) --


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new mobile advertising platform, iAd, is poised to squeeze



place in the market, according to a recent weeklong poll in


Last week, Apple announced that its new iPhone, which will debut this summer, will include updated 4.0 OS software that will allow ads to run on applications.

In response, we asked the readers of


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: "Will Apple's iAd system ultimately hurt Google's place in the mobile ad market?"

The response: a surprisingly sizable 78.3% of voters say yes, that iAd will ultimately hurt Google's place in the mobile ad market; a mere 21.7% don't think it will have any effect.

While the mobile advertising market is not currently a dominant market -- at only $300 million -- it could one day dwarf the $20 billion U.S. Internet ad space, Susquehanna analyst Marianne Wolk wrote in a note. Google currently holds 10% of the mobile ad market, while Apple has 7%, pretty much making the market anyone's game.

Google, for its part, is currently in the process of trying to secure the purchase of AdMob, but it has met criticism from the Federal Trade Commission. The argument against Google owning AdMob, from a regulatory standpoint, would be that Google already dominates the online ad market.

Google reported a 37% surge in first-quarter profit

on Thursday to $1.96 billion, or $6.06 a share, on revenue of $6.77 billion. The company said its Android application store now has 38,000 apps, a 70% increase from last year's period.

During Google's conference call, investors received several remarks regarding Google's mobile advertising strategy. "We want to make it easier for users to expand their existing campaigns to mobile rather than starting from scratch," Susan Wojcicki, vice president for product management, said during the call.

Jeff Huber, senior vice president for engineering, followed that up by declaring that Google believes in open platforms, and encouraged everyone to do the same. Apple's platform is much more controlled.

Google also said it expects its AdMob deal will go through, and that it will be able to convince regulators that the mobile ad market is still young and competitive. Apple's entrance into the market with the iAd could also be a catalyst to help it earn approval, the company said.

AdMob declared during the Ad Age Digital 2010 Conference earlier this week that Google's Android units will triple and could eventually be equal to the number of iPhones.

--Reported by Jeanine Poggi in New York.

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