Ads in E-books? iAd and its implications…

Jobs reveals mobile advertising. Could they find their way into e-books?

Apple recently revealed plans to release OS4 for iPhone this summer and a similar update to the iPad in the fall. While the new OS supports many mouth-moistening features for Apple nerds, one particular feature has media developers drooling a bit more than usual. iAd will allow in-application advertising, opening the Pandora’s Box of advertisements in your favorite mobile device.

It was inevitable. The ad-serve model has been the mainstay of media companies for decades, and so it was only a matter of time before mobile apps too found a way to tap in to this explosive revenue source. But, as many have noted, the iPad has a special emphasis on e-books, and it isn’t a stretch to imagine a Blade-Runner-esque future of ad-embedded e-books. Think that sounds horrible? Well, belay your anger for a second and imagine the possibilities.

Ad-embedded e-books may hold an interesting opportunity for publishers and readers.  The traditional advantage of the ad model is it allows displacement of pricing; instead of paying for content, audiences suffer through ads that companies pay for to reach that audience—the audience pays a reduced amount for the content they consume. As Joe Wikert from TeleRead points out, publishers should consider making two versions of their e-books—one with ads, the other without. The ad-enabled version could be priced far lower and potentially distributed more freely than the ad-free version because publishers would collect revenue regardless.

Maybe I’m just a media nerd, but this could be an interesting, albeit a bit stomach turning, workaround for many e-book revenue problems. Thought I hate to say it, there is no free lunch e-book—at least this way consumers may get greater freedom…brought to you by ads.