Social games firm SGN has announced plans for an in-app advertising network, which will involve promoting partners' games within its own stable of iPhone titles.

The ads will take the form of banners, with players encouraged to try games in return for rewards in that SGN title - respect points in Mafia: Respect & Retaliation, for example.

It's free to take part, although SGN takes a cut of partners' download revenues. Given that the company's games have been downloaded more than 12 million times, it sounds pretty appealing.

"With the anticipated launch of the iPhone OS 3.0 and one billion applications downloaded to date, the rush of new applications will be tremendous and it will get harder and harder to stand out of the crowd," says SGN CEO Shervin Pishevar (pictured).

Two iPhone developers have already signed up: Punch Entertainment and Smallmedium.

"Punch Entertainment and Smallmedium, both companies we admire, will now be able to reach a broader audience and will get a boost in downloads by joining our cross-promotional network," says Pishevar.

"We have seen the benefits of this approach through the trials we have undertaken with our current games and through the gaming hub on Facebook."