But when it came to the advertising that would be featured in The Daily, the logical choice for ad placement, Apple’s iAd, lost out to the New York start-up Medialets, which provides a similar service with a few key differences. Medialets provides the technical platform for publishers and agencies to collaborate on creating rich media advertising, and instead of taking a percentage of the ad revenue for apps — which is Apple’s model, to the tune of 40 percent — they get a small ad-serving fee each time the spot is shown.
“As Apple continues to expand its boundaries into the core parts of many publisher’s business, there is a growing opportunity for alternatives,” says CEO Eric Litman. “From a technical perspective iAd is very compelling, but in terms of business, it just doesn’t fit with the way publishers think about the world.”
Founded in 2008, Medialets has since signed on over 100 top media players, including The New York Times, WSJ, CondeNast, Hearst, NY Mag and CBS.
“The entire industry was using Flash, and then the iPad came along and didn’t support that, so everyone had to scramble to figure out what the best new tool was,” says Marc Frons, who runs the technology group at the NY Times. “Medialets has emerged as a new leader.”
Medialets shares detailed campaign reports with publishers and agencies, while Apple has increasingly cut publishers off from user data. And because Medialets relies on HTML5, publishers don’t have to worry about Apple versus Android verus RIM. “Advertisers don’t want to think about devices, they want to think about audiences,” says Litman.
These competitive advantages are showing up in the bottom line. Medialets’ premium inventory across iPhone, iPad and Android devices increased nearly 300% in fourth quarter of 2010. To keep up, the company has expanded from five original employees in 2008, to 55 today.
bpopper [at] observer.com | @benpopper