Apple CEO Steve Jobs unveiled App Store, the company’s system for distributing third-party iPhone and iPod touch applications, on Thursday. App Store will let users find and install applications directly from their iPhone or iPod touch over Wi-Fi, according to CEO Steve Jobs.

App Store will let users browse categories that include business, games, finance, lifestyle, health, and more. Once an application is installed, App Store will alert users when updates are available, too.

Developers interested in distributing their iPhone and iPod touch applications will have to join the developer program for US$99, and will have access to the software developer kit later today.

Distributing an application through App Store doesn’t require any extra fees, although Apple will take a 30 percent cut from each app sold. Developers can set their own app prices, and free programs will be distributed without any costs, hosting fees, or bandwidth charges.

Companies hoping to distribute porn apps, malicious apps, or programs that invade user privacy, however, will have to look elsewhere. Mr. Jobs said those programs are off limits and won’t make it to the App Store.

Users looking to get their hands on applications through App Store will have to wait until June. Apple said that’s when iPhone and iPod software update 2.0 will be coming out, and that the update will be free for iPhone users. iPod touch users will pay a "nominal fee" because of the way Apple accounts for iPod touch sales.

Apple’s iPhone SDK and App Store are good news for developers. Prior to the SDK release, developers had to create hacks to build and install apps on Apple’s handheld devices, but now they will be able to create their products with the company’s blessing.

While there will still be a market for unauthorized apps and hacks, the demand for those will likely dwindle as more Apple-blessed apps come to the App Store.

[Thanks to ars technica for information about App Store.]