Why Apple Wants to Own Video Ads on the iPad

Users are more likely to click through video ads on the iPad than any other mobile device, according to new research from Rhythm NewMedia. The research shows why advertisers will want to target the iPad (if they aren’t already), and subsequently why Apple (s AAPL) is busy building a new in-stream ad platform to help publishers serve video ads on the device.

According to Rhythm NewMedia‘s latest quarterly mobile video ads report, the average click-through rate for pre-roll video ads on the iPad are dramatically higher than on the iPhone, iPod Touch or Android (s GOOG) devices. Click-through rates on the iPad are more than double what they are on iPhone and iPod Touch devices, and about three times higher than on Android mobile handsets.

While Apple currently serves display units through its iAd ad network, adding video could also increase click-through rates on its iOS devices. According to Rhythm NewMedia, users clicked through full-page ads with video a whopping 10.3 percent, which is unheard of for online advertising. Those click-through rates on average were 79 percent higher than full-page ads served without video.

Not just that, but mobile video ads have higher retention rates than video ads online in general. Mobile video viewers are much more likely to stick around during ads, as interactive pre-roll ads have a completion rate of about 87 percent, according to Rhythm NewMedia. When compared to retention rates of regular online video, 94 percent of mobile viewers stick around through the first 10 seconds of a mobile pre-roll ad, compared to just 81 percent online using computers. Even when asked to watch a full minute of ads, mobile viewers are much more resilient in the face of pre-rolls, with 68 percent staying for 60 seconds of ads on mobile devices, compared to just 56 percent on PCs.

Finally, the amount of video being consumed on mobile devices continues to grow, particularly through apps that deliver full-length episodes. The average video minutes consumed on apps with full-length programming increased by 20 percent for the second consecutive quarter, according to Rhythm NewMedia’s research, and now average nearly 40 minutes of viewing time per month. That’s bound to increase, particularly as more new content becomes available through mobile devices — and there will no doubt be more mobile content if Apple can deliver a video ad solution on iOS devices that will help publishers better monetize those videos.

To hear how Adobe’s mobile strategy differs from Apple’s, come see Adobe CTO Kevin Lynch speak at this year’s NewTeeVee Live.

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