Apple Inc. (NASDAQ:AAPL) is one of those tech companies that makes its living on rumors. Not that the company starts them, but it is notorious for making no comments on any of them that happen to swirl around. Some of the rumors turn out to be hogwash, while others are pretty legitimate and are proven so in due time.
But then, there are rumors that are the classic definition of rumor – innuendo, hearsay that is heard once and cannot be independently confirmed, but it is treated as news anyway. This is one of those examples, but it could be a rumor that might change the landscape in the online advertising business. Many in the know are well aware of the success that Google Inc (NASDAQ:GOOG) and Facebook Inc (NASDAQ:FB) have had in creating advertising exchanges, which allows partners to purchase space for targeted ads based on search preferences, consumer habits on the Internet and other key metrics. Both companies have made a large chunk of their revenue every year from this platform. And this new rumor is apparently marrying Apple Inc. (NASDAQ:AAPL) to the concept of an ad-exchange platform that is similar to those compatriot tech companies.
The rumor comes from a “highly placed” person in the online advertising world, someone who reportedly is intimately involved in the market. So what makes this Apple Inc. (NASDAQ:AAPL) such a rumor? There is apparently no independent confirmation, as other sources that were asked said they heard nothing indicating such a thing was in the works. However, Apple does have a mobile ad network called iAd, and there are some in the mobile ad business who seem to be anticipating such a move.
However, Apple Inc. (NASDAQ:AAPL) CEO Tim cook was quoted at the AllThingsDigital conference this week that advertising has not been a core function for the company, instead noting that its mobile ad platform is designed more for developers to make money and create more products for use in the Apple ecosystem.
Former Apple Inc. (NASDAQ:AAPL) executive Dan Grigorovici likes the possibilities of an ad exchange at Apple, but he sees challenges. “I had always believed that if Apple plans to evolve the ad business to be more important, they have probably the best opportunity for cross-channel advertising, and one of the best data assets out there. … (But there is) a dilemma here: Apple’s closed ad ecosystem offers tremendous benefits and differentiation, but it fundamentally does not solve the scale problem.”
Would you agree with that sentiment? Do you think Apple Inc. (NASDAQ:AAPL) can be successful with an ad exchange? If not, why not? What challenges do you see? Give us your feedback in the comments section below.