The nice thing about dictatorships is that they get things done. There is no “in between” with a dictatorship like there is with a democracy; no compromise. In a way, this is what makes Apple great. Under Jobs, the direction of the brand has had a singular focus on producing his vision of great experiences for their customers. If it was an experience you liked, you could fill your life with perfectly designed, high-functioning, well integrated products. If you didn’t, you could move to something more democratic, say, Microsoft or Google, Sony or IBM.

The bad thing about a dictatorship is that once the leader loses it, the whole thing starts to come undone. And they always lose it. There’s always something, some person, some event, that starts to plant seeds of doubt and, in the end, that single point of vision becomes a tyrannical mess of paranoia and irrational behavior. It’s clear Jobs hates Google. Not in a competitive way, but in some deep, personal and increasingly irrational way. For a guy who seems to have never made much of a bad decision, this target fixation has seemed, over the last months, to begin to take him off his game.

Thursday morning, I tried to get out of the house early so I could stop by Voodoo doughnuts on my way into the office. One of the advantages of having your own agency is that you can declare any day that Steve Jobs is on stage as a company holiday. I had made it known early in the week that we’d be taking the morning off and taking over the conference room to project various tech blogs, eat doughnuts, and talk about Apple magic as it happened. For most of the presentation — for 6 “tent poles” — that’s exactly what we did. Then came tent pole 7: iAd.

Here is my fundamental problem with iAd: It makes no sense from a brand strategy point of view. It’s irrational, and philosophically counter to nearly every previous decision Apple has made under Jobs. To be clear, it’s not crazy in the way that most people will ever notice — after all, most of us have spent the last 15 years being trained to expect display advertising as just a way of life. But advertising is fundamentally user-hostile. That’s the core nature of it; it’s why it works. It’s designed to make you stop whatever you were doing and look at something else. While it probably seems histrionic to take something so seemingly small and blow it up to this size, I do believe this marks a fundamental change in motivation for Jobs and Apple.

What I’d like to do is agree with people like John Gruber that Apples motivations are to preserve the overall user experience of the iPhone, and honestly up until iPhone 4, that has always been what I believed. But iAd negates that premise on fundamental level. This is the first time I can think of that Apple has chosen to make money at the direct expense of its customers’ product experience. People can, and have, argued for a long time that those of us supporting Apple and its draconian control of its platforms we’re just begging for this to happen. But I think it’s critical to consider that until iAd, the goal was to create a specific notion of quality user experience. For many of people, it wasn’t the experience they wanted, but that it was customer-focused is hard to deny.

Of course there are already ads in applications so it could be argued that iAd doesn’t really change much. Or, to Jobs’ point in the presentation, this is a chance to make those ads better. This line of reasoning doesn’t seem to hold water though either. For a company allegedly so focused on preservation of good user experience that they’re willing to throw Adobe under a bus, why would they invest so heavily in making intrinsic to the iPhone experience a system that would invite what is arguably the worst aspect of user experience on the web into their device? I can’t think of a reason. But the real difference here is that with iAd, Apple has actual financial motivation to have the iPhone/app user experience degraded. Previously, Apple could take no position on in-app advertising, but now, with a 40% cut of each ad, the more ads that go out, the better Apple does.

One could argue that Apple introducing iAd is better for their customers in that it allows more developers more opportunity to create applications and make a living off them. And this is true. But if Apple’s motivation was to bring more developers into the fold, why, on the same day they announced iAd, would they choose to proactively lock out Flash as a development platform. Gruber’s take on this, as it has been from the start, is the Flash is simply not capable of producing a user experience at a level Apple feels is on par with the overall device. Fair enough. But if UX is the central issue, it’s hard argue that in-app advertising, ads Apple will not be vetting, will produce any better UX than Flash. After all, iAd gives huge amounts of iPhone user experience control to ad agencies, people with no track record of being able to produce anything other than bad UX and no motivation, monetarily or otherwise, to do anything other than throw away work.

Rather than spending their time and resources to update the App Store, something that’s been asked for from nearly day one, iAd seems to be an investment by Apple in a race to the bottom, tying application developers’ livelihood to the same display ad system that has left huge parts of the content creation industry on the web in shambles. Why not instead invest in making structural updates to the actual purchasing process to help elevate the developers doing the best work, and then help them find a way to actually charge a living wage for their work? Why not take the same, revolutionary approach Apple always has and find a way to free developers from having to find ad real-estate in their applications so they can focus on continuing to make their, and Apple’s, products even better?

The only logical answer is clear: To beat Google.

But given that a company whose name has always been tied to changing the game, such an investment in playing someone else’s game leaves me wondering: does Apple have the cultural and organizational underpinnings to manage a system that is both open to outside development and the clear frontrunner in a category, while maintaining their history of a clear focus on user experience? If iAd is any indication, the answer is no.

With Mac, Apple has always been able to be the contrarian second place; making huge profits while catering to a smaller, but vastly more loyal base of fans. The iPod on the other hand is clearly the industry leading platform. But it’s closed. Apple has always had top-to-bottom control of everything that goes on it save for the music. iPhone is something different though. It’s neither the plucky niche product of Mac, nor the highly controlled iPod.

In Apple’s seemingly desperate effort to control this rapidly expanding system, the strains on the dictatorial system are becoming evident, and it’s not clear Apple has the systems in place to stay sane. In fact, it would seem this new found position has resulted in increased paranoia and a fixation on beating specific competitors in specific ways rather than making revolutionary advancements. That they would try to lump iAd in with other user-focused features is either completely disingenuous or evidence of increasing detachment from reality. For whatever reason, Jobs has decided his mission now is to beat Google first, beat Adobe second, and everything else comes third, including Apple user experience.

This isn’t to say that Apple will stop making good products — they’ll likely continue to for a long while. But as a post-Jobs Apple moves nearer, the questions of what drives the company without him becomes more important. iAd is a strong signifier of the kind of brand confusion that I think is beginning to emerge, and without Jobs in place, the “do what it takes to make money” path is now just viable as the “make great products” one. We’ve all seen the “money at any cost” Apple of the 90’s, and it wasn’t pretty.