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Please explain how iAds will be "part of the OS" if they are downloaded over the air when the app is run just like any typical add from admob?

Mark my words, full iAds will be available even in airplane mode.

For things like admob, the developer uses a library that has all of the code to retrieve and display the ad. For iAds, the developer just places an iAd control where they want the add to show up - the OS then sees that there is a blank space in the UI for an ad, and places an iAd there.

It's a fairly subtle distinction, since admob has libraries that do almost all the work for you, so the process for the developer to integrate ads is very similar.

One very nice thing about iAds is that there's no additional sign up process that needs to be done by the developer - the developer is already set up to be paid by apple, so it's just an additional payment.
 
Ad Mob is much more difficult to code than iAds. Plus Ad Mob wasn't striaght from apple, meaning another contract was signed.
 
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