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Madison Avenue has been abuzz regarding the rumored April 7th unveil of Steve Job’s latest revolution, iAd. Although I have not been able to confirm the release of Apple’s (NASDAQ:AAPL) new personalized, mobile advertising system I can’t help but wonder if we’re going to hear something about it at the iPhone OS invitation-only event set for this Thursday April 8th.

In the latest edition of the Net Applications report, Apple’s share of global mobile web browsing is at 67% from the iPhone and iPod Touch (see here); I expect the iPad will do its part to boost that market share even further. The window of opportunity for Apple to introduce a mobile advertising platform is wide open.

Over the long run, a successful iAd platform could be as important to Apple as any of their other products including iMac, iPod, iPhone and iPad. If Apple can make money from iAd they could offer their lineup of hardware and software at a subsidized discount to current price levels, paid for by advertising. Even more likely would be the potential for free content through iTunes. iPad users especially are looking to consume mobile content at unprecedented rates. Content providers like the Wall Street Journal and Reuters are hoping to be able to charge subscription fee’s for iPad offerings but the better way is an improved advertising platform.

If Steve Jobs can integrate Quattro into the iPhone OS and guarantee that Apple users consume the advertisements... watch out below! In a world where television viewers skip over commercials with DVR and newspaper/magazine readers are migrating online, a successful iAd platform would become the darling of Madison Avenue.

What’s great for Apple would be disastrous for Google (NASDAQ:GOOG). Google knows that they are at Apple’s mercy in the mobile web which is why they’re giving away the Android OS for free. Although Google makes no money from this, they have captured 26% of the global mobile web market share from the more than 20 phones that use Android according to the Net Applications report. The main purpose of Android is to help Google maintain its share of online advertising that is under attack in the shift from PC to mobile. Google investors should be very concerned about the threat of iAd.

When the multiple layers of innovation are peeled away, you find that Google’s only real profit machine in online advertising. My opinion is that iAd is potentially a good thing for Apple but would be a devastating knock out to Google.

Disclosure: Author holds a long position in AAPL and a short position in GOOG

Source: Apple's iAd Coming Soon? Watch Out, Google