iTunes Radio, Apple’s upcoming streaming music service that will compete with services like Pandora and Spotify, will be partnering with large brands for audio and video advertisements, according to a new report by Ad Age.

The service, which will be available on all iOS devices – including the Apple TV – and every computer that can run iTunes, will be ad-free for subscribers of Apple’s $24.99/year iTunes Match service, but otherwise “users will be served an audio ad once every 15 minutes and one video ad every hour”, according to Ad Age’s sources. “The video ads will only be served to consumers at times when they are likely to be looking at their device screen, such as immediately after hitting play or choosing to skip a track.”

Advertisers at launch include “McDonald’s, Nissan, Pepsi, Procter & Gamble and possibly one or two more brands” and 12-month contracts have been signed. Advertisements will be device-agnostic at first, however, the brands will be able to choose which devices they would like to target in the future.

When the launch goes wide in 2014, advertisers will have the ability to target specific devices for their ads. The cost of iTunes Radio ads will increase with the size of the screen, according to agency executives; iPhone ads will be cheapest and Apple TV ads will be the most expensive.

itunes-radio-curated-stationsThe service’s curated stations, which have included “Trending on Twitter”, “Music Heard at WWDC”, and “Dance Discovery”, may also be created by brands themselves. The company’s name may not be in the title, but may present a message before playing stating something, a la Hulu: “Brought to you with limited commercial interruption by [brand]”.

iTunes Radio is expected to launch in the US at the company’s rumored September 10th keynote and will be rolled out across the globe gradually.

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