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Mr. Pallad started with Apple on December 2 and spent last week
at the company's Cupertino, CA, headquarters getting oriented, the
people said. Radio industry email newsletter Tom Taylor Now had
previously reported that Mr. Pallad may be leaving Cumulus Media to
join Apple.
Apple did not immediately respond to a request for comment. Mr.
Pallad will report into the iAd organization led by VP and former
Yahoo exec Todd Teresi.
Mr. Pallad's appointment suggests that Apple plans to make a
stronger play at the $1.56 billion U.S. digital radio advertising
market, as estimated by eMarketer. One media buyer said the executive
should gain traction quickly among agencies.
Apple launched music streaming service iTunes Radio in September
with a handful of category-exclusive launch advertisers, such
as Nissan, Pepsi and Procter &
Gamble. Those initial deals expire at the end of this year,
when Apple will begin pitching the service more broadly to brands.
The initial campaigns included audio, video and display ads that
air between songs.
Like everything Apple has tried in advertising, it's going out
with ambitious pricing,
reportedly looking to sign 12-month commitments that are worth
at least $1 million apiece.
The hire of Mr. Pallad "seems like a big bet for [Apple] on
going after the radio advertising audience," said DigitasLBi senior VP-media Adam
Shlachter. EMarketer projected that domestic ad spending on digital
radio will rise by 157% over the next several years to hit $4.01
billion by 2017. But that's only a fraction of the $15.62 billion
U.S. advertisers will spend on AM/FM radio this year and $16.05
billion in 2017.