Steve is showing a completely interactive ad here, almost like a sub-app inside the application. Embedded video, toys to play with. Really impressive as far as mobile advertising goes. If that kind of thing excites you.

Joshua Topolsky, liveblogging the iPhone OS 4 event.
He hits on the key point: advertising, no matter how great, only excites the advertiser, generally not the advertisee (though in narrow circumstances: of course, you’re glad to hear about something that interests you. 99.9% of all web-based advertising I’ve ever seen would interest no one). Nothing poses more of a hazard to the platform than opening this sort of floodgate for intrusive, platform-wide ads than does iAd.
Which Apple itself introduced today.
The examples shown seem tame enough, but then it always seems tame to start. Advertisers simply will not content themselves with opt-in advertising tucked away inside an app, and the new suspend/resume function means there’s no escape, the interrupting ad will still be waiting for you when you return; these are the people to whom you’ve just given the keys to the kingdom, and it has the capacity to make the crown jewels (the information-driven apps) totally unusable.
Pundits keep thinking Apple is going to “closed” itself out of the mobile market just like they all have convinced themselves that Apple did in the PC market. They won’t. But if it’s not careful, Apple will ultimately advertise itself out of the market.