Leveraging social signals to serve more interesting ads in your free apps
Facebook is testing a new ad network model that could leverage its vast customer data to serve ads in third-party mobile apps in the future. In what is simply being called a "test" at this point, Facebook says it is working with a small number of advertisers and app developers to show Facebook-generated advertisements in free apps on mobile.
The social network has dabbled in this sort of thing before, but has always used an outside ad network to make the process run smoothly. Cutting out one of the middlemen means more control (and profit margin) for Facebook, provided it can manage the entire process. Google famously makes amazing profits on its AdSense ad network because of the number of signals it can collect from customers using its products — the same could be true for Facebook on some level.
Given how successful Facebook's advertisement targeting has been in recent months in its own app — ad revenue isn't the highest, but it's doing relatively well — it makes sense that it would want to leverage that experience with third-party apps also. There's no indication at this point which apps are using Facebook's new ad network, but it does say that it is open to new partnerships at this time.