Jobs touted HTML5 during a demonstration Thursday of a newfangled ad for the movie, "Toy Story," which was intended to show new interactive iAd advertising capabilities of iPhone OS 4. "All this stuff is done in HTML5, by the way," Jobs said.

Multitasking made the cut in version 4. "We've been using it a lot, and it really changes the way you use the iPhone," Jobs said. Apple says it has has configured its multitasking so that it can be implemented without significantly draining batter life. Jobs showed an iPhone being used to view a Web site and then switch back to mail.

Multitasking was given a thumbs-up by a developer in the audience. "I thought the multitasking was definitely a necessary and positive step forward," said developer Luca Rajabi, project manager with First American Information Solutions Group. Rajabi had his iPad on hand for the event.

Enhanced email functions in iPhone OS 4.0 include a unified inbox for maintaining multiple email accounts, such as Yahoo and Exchange. Also featured are fast inbox switching, thread messages, and opening of attachments with applications.

Folders in version 4 enable users to find different items stored on the device. Another eye-opening capability, iAd, enables deployment of interactive ads to run within applications. Apple will host the ads and promises developers will get 60 percent of revenues from the program.