Apple cuts iPhone advertising costs

Apple has reduced the rates for advertisers using its iAd mobile advertising platform in a bid to stop them moving to cheaper rivals.

It means firms will get up to 70 per cent off the cost of their adverts on iPhone and iPad platforms.

According to a Bloomberg report, Citigroup and JC Penney are just two of the firms to have recently turned their back on iAd campaigns in favour of less costly ventures.

However, Apple is hoping to coax them back by offering a deal for less than a third of the price they initially paid.

The official price cut is approximately 50 per cent, but Apple is reportedly willing to stretch even further if firms buy multiple campaigns.

Young and Rubicam ad agency told Bloomberg that the technology firm is having to backtrack after initially charging too high a fee for its services.

“Apple’s closed ecosystem may have been interesting in the short run for advertisers, but in the long run they priced themselves out,” explained senior vice president Thom Kennon.

It is thought that Apple will launch the new version of the iPhone – the iPhone 5 – in September or October.