As heavily rumored, Apple’s Steve Jobs just announced an advertising platform for iPhone applications.

Dubbed “iAd” the new ads are designed to integrate with iPhone/iPad apps, meaning the user is exposed to the ads within the app–they’re not taken to some web page to view the content.

Apple plans to host and sell the ads, and will give the developer 60% of the collected revenues.

The ads will be interactive, take advantage of video, and allow developers to create free apps and monetize them with the ads.

iAds are not live yet, but Jobs showed-off one they created as a demo for Disney’s Toy Story:

No news yet on who creates the ads or how they are purchased. We’ll update as we learn more.