The next big thing for Apple, according to Apple CEO Steve Jobs, is advertisements. Yup, you read that right.

Steve Jobs just announced that in line with Apple’s release of the latest update for the iPhone OS, compatible with the iPad, iPhone and iPod Touch, is the capacity of applications to deliver advertisements that are hosted directly from Apple’s own servers. Steve Jobs exclaims that through this new thrust, the company can potentially earn millions of dollars from advertisement revenue.

If you’re familiar with Google‘s Adsense, you could probably think of this as something similar. Developers of iPhone apps will be able to embed advertising in their applications that are hosted directly from Apple, from which they will be chopping off a 40% revenue cut of all advertisement proceeds.

How does this work for everyone?

• Apple gets a 40% cut of ad revenue. Enough said.
• Application developers get free advertising space and hosting, and, of course, get a majority 60% percent of advertising revenue generated from their applications.
• Consumers (that’s probably you) will see more and more apps switch over to being freely available, as the “costs” of your iPad / iPhone apps are relatively converted to advertising revenue instead. Free apps!

Apple, however, also states that they will continue to allow third-party advertising providers to run ads on iPhone/iPad applications. Apple estimates that soon enough a majority of advertisements will be run from their platform, however.

The new platform (dubbed iAd) is expected to roll out in the next few months.

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