Apple enters mobile ad space with iAd launch

Apple today unveiled its new iAd mobile advertising platform as part of its iPhone OS 4.0 upgrade, an ambitious effort that will see the white-hot smartphone maker hosting and selling mobile ads.

The unveiling of iAd was part of a larger presentation by the company on the latest version of its iPhone operating system. Other elements introduced to the platform include multi-tasking, improved email functions, enterprise services, a digital books application and more. Click here for the full story.

Apple's iPhone OS 4 beta software and SDK are available immediately for iPhone Developer Program members at developer.apple.com. The company's iPhone OS 4 will be available as a software update to iPhone and iPod touch users this summer. A version of iPhone OS 4 will be coming to iPad this fall.

As for iAd, according to numerous live blogs of Apple's press event, the company outlined a mobile advertising platform that will allow iPhone application developers to insert advertisements into their apps--and share in the revenues generated from the sale of that ad space. For selling and hosting the ads, Apple said it will keep 40 percent of the revenues generated from ads, pushing the remaining 60 percent to the app developer. Apple currently retains 30 percent of the revenues generated from application sales through its iPhone App Store.

Company executives said Apple will approve all ads, though it will take a light touch to the process (notable in light of the company's sometimes murky approach to application approvals). Further, ads must be developed in HTML5 for iAd--another knock by Apple against Adobe's Flash, a main platform for Web ads.

In a demonstration of iAds detailed by a number of live blogs, including those by AllThingsD and Engadget, Apple's Steve Jobs showed how free iPhone apps can generate revenues for developers with the inclusion of ads. The demo showed a sliver at the bottom of an application touting the upcoming "Toy Story 3" movie. Tapping on the ad launched a sort of mini Toy Story application that featured videos, games and movie showtimes. Jobs described the iAd experience as a combination of emotion and interactivity.

Though iAd, Apple's Jobs boasted the company has the potential to serve a whopping 1 billion ad impressions per day.

Apple's ad play builds on the company's January acquisition of Quattro Wireless--a purchase the company made after Google foiled its attempt to purchase AdMob by acquiring the company for $750 million in November.

For more:
- see this Engadget live blog
- see this Apple release

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