• by Mark Walsh  @markfwal, August 7, 2009

Facing a backlash from developers, AdMob is backing off its decision to pull out of services that allow iPhone application developers to plug into multiple ad networks to monetize apps.

In June, AdMob announced it would no longer work with multi-network platforms such as AdWhirl and Tapjoy to place ads in iPhone apps because of user complaints about broken ads being served. The company also cited difficulties in targeting ads properly through "mediation layers," or other ad middlemen.

As the dominant iPhone ad network, AdMob's withdrawal was a potential blow to ad network aggregators like AdWhirl and the app developers for whom they promise increase ad fill rates and boost revenue. But after initially delaying its pull-out until Aug. 5 in response to concerns raised by developers, AdMob now appears to be tabling its plan to cut off ad aggregators indefinitely.

"In order to ensure that we are focused on doing what is best for our publishers, we have decided to temporarily delay the discontinuation of support for mediation layers until we can introduce a comprehensive plan that meets our publishers' needs while also continuing to provide advertisers and end users with the best possible experience on mobile," wrote Ali Diab, vice president of product management at AdMob on the company blog this week.

The statement was tacked on to a post announcing the company would begin allowing developers to run unpaid house ads to cross-promote their apps and sites within their own apps. That move would help AdMob better compete with AdWhirl, which already allows house ads for cross-promoting apps.

AdMob's decision to continue working with ad aggregators also raises a question about whether it might join the new mobile ad exchange announced http://blog.mobclix.com/?p=417 by Mobclix this week. The marketplace allows advertisers to bid on placement in iPhone apps and supports 20 mobile ad networks at launch including Yahoo, Google, Jumptap and VideoEgg. Conspicuously absent is AdMob.

Mobclix co-founder Krishna Subramanian said Thursday the company is still in discussions with AdMob about participating in the exchange, trying to address its concerns about reliable ad-serving and ad optimization. "We're completely willing to work on this with them," he said, suggesting any technical issues could be ironed out by the companies.