Apple's iPad sets strong sales pace, iAds unveiled

CUPERTINO, Calif (Reuters) - Apple Inc CEO Steve Jobs on Thursday revealed stronger-than-expected sales of 450,000 for the iPad since its much-hyped debut, and touted a phone operating system with a new advertising platform to compete with rival Google Inc's.

Analysts expect sales of 1 million units or more for the device -- touted as a new class of gadget that will bridge laptops and smartphones -- in the current quarter ending June, and roughly 5 million in 2010, though estimates vary widely.

The electronics giant has staked its reputation on the 9.7-inch touchscreen tablet. It is helping foster a market for tablet computers that is expected to grow to as many as 50 million units by 2014, according to analysts.

Despite being deemed to have no clear-cut case for use other than pure media consumption, analysts expect Hewlett-Packard, Dell and others to trot out competing devices of their own this year.

Since going on sale on April 3, users have downloaded 600,000 digital books and 3.5 million applications for the iPad, Jobs said.

At a media event at the company's Cupertino, California, headquarters, Jobs said Apple had so far sold more than 50 million iPhones, the smartphone that competes with Research in Motion's Blackberry and Palm's Pre.

Apple is expected to launch the fourth generation model of its iPhone, which was first introduced in January 2007, later this year.

Job, looking thin but energetic, said the forthcoming iPhone 4.0 operating system -- also available on iPads this fall -- will carry its new "iAd" mobile advertising platform, marking the company's foray into a small but burgeoning market.

iAds will allow applications developers to sell advertisements pocketing 60 percent of the revenue.

Apple's entry into the mobile ad arena had been widely expected. This year, it paid $270 million for Quattro Wireless, an advertising network that spans both mobile websites and smartphone applications.

Google, which already sells advertising on smartphones, agreed to buy mobile ad firm AdMob late in 2009, U.S. regulators are examining the deal's antitrust implications.

Research group Gartner expects the mobile advertising market to grow 78 percent to $1.6 billion in 2010.

Jobs also said the new operating system will include support for multitasking -- addressing a perennial consumer complaint -- allowing users to switch between several programs running simultaneously.

Shares of Apple turned positive briefly after Jobs' announcement before quickly dipping back into negative territory. They were 0.3 percent lower at $239.94 in afternoon trade on the Nasdaq.

(Writing by Edwin Chan; Editing by Steve Orlofsky, Leslie Gevirtz)