Apple is a new contender in $100B mobile ad market

Apple wants a piece for itself in the $100 billion mobile advertising market. The tech titan is going to "start showing search ads for apps in its iOS App Store search results for the first time," reported The Verge on Wednesday. The news stemmed from an interview with Phil Schiller, Apple's senior vice president of worldwide marketing.

"We’ve thought about how to carefully do it in a way that, first and foremost, customers will be happy with, “Schiller said, adding that he believes the ad auction system in App Store search will be” fair to developers and fair for indie developers, too."

Until now the mobile search has largely been a ported version of desktop search, with people using Google to type in some keywords. With more mobile activity taking place in apps, traditional search loses relevance on smartphones.

With over 1.5 million available apps, discovery is almost impossible for independent developers. Adding an ad-based search component gives developers a way to pay for access to consumers. Perhaps more importantly, it gives Apple a new way to make money with iPhone sales slowing and the company putting a greater focus on software and services.

This move would also deepen Apple’s rivalry with Google as Google controls 95 percent of the global market in search on phones and tablets. Also, according to eMarketer,spending on mobile ads will surge 48 percent this year to $101.4 billion.

Schiller also added that the App Store has been speeding up app review times — to the point where 50 percent of submitted apps are now reviewed in 24 hours, and 90 percent are reviewed within 48 hours.

The interview also saw Phil speaking at length about Apples proposed revenue-sharing model for apps. While the well-known 70 / 30 split will remain, developers who are able to maintain a subscription with a customer longer than a year will see Apple’s cut drop down to 15 percent.