There are rumblings that Apple is going to ban geo-location ads on the iPhone.  This is just the start.  Here’s what I think is going to happen:

Apple will only allow free apps to run ads served by them from their new advertising division they gained via Quattro Wireless.

It makes perfect sense.  Apple loves to have control over everything.  Look at the iPad- they control the processor, battery, software, apps on it, casing/molding, and sales distribution.  Why would they stop there and not go after ads?  This will be their most direct shot at Google in order to stop them from “killing the iPhone”.  Developers will love it too, as it will serve as a semi loss leader, the same way the iTunes store does:

  • Payouts and rates that put AdMob to shame.  Apple isn’t in the business of ads, they’re in the business of selling hardware.  They can afford to give more to developers and basically break even.
  • Tight integration with XCode and Apps.
  • Apple like elegance for advertisers to log on and place an ad.  Imagine if placing an ad was as elegant as using an iPhone, iLife, or any other Apple product. The press they get from this move will certainly attract advertisers on day one.
  • Publishers will love it.  Not all content is going to be behind a pay wall, and those that offer their content for free will now have a huge incentive to make iPhone/iPad apps.

Expect a WWDC release.  Google should be scared shitless if/when they do this. Weigh in on a poll here whether you think this will come true.