The largest and fastest growing product sector in history is the mobile phone. Most investors think it’s too late to garner big gains from this sector. I’m going to tell you today why they’re wrong.

B4 tht I rly wnt 2 tlk 2U abt txtng. K? =)

That wasn’t a series of typos, of course. It’s a less-obscure example of a new variant of written English. Called “Weblish” by some, it portends enormous profit potential as it sweeps the world via mobile phones.

Enabled by exponential improvements in semiconductor manufacturing, the mobile phone has the distinction of being the most rapidly adopted new technology in human history. Growth has been faster than for the land phone, the television and the Internet itself. Mobile telephony has surpassed even the dissemination of Jonas Salk’s polio vaccine in the 1950s.

Remarkably, it’s been less than 30 years since the appearance of the first commercially available mobile phone in the U.S. — Motorola’s DynaTAC 8000 “brick” phone. In 2009, subscriptions passed the 4 billion mark. Today, more than half the world’s population pays to use mobile phones. Cell phone ringtones are routinely heard in remote villages of developing nations without running water or modern sanitation. In fact, two-thirds of the mobile phones in use are in developing nations. There, they are bringing many their first access to modern banking, real-time commodity prices, severe weather alerts and other important services.

Mobile phone innovators and their investors have been rewarded with fantastic returns, but the opportunities for transformational profits are far from over. There are still untapped markets in mobile computing, with enormous wealth-creating potential for those that invest with a long view. The mobile phone as a data platform, in particular, is still in its infancy.

While originally a purely voice-based technology, mobile telephony has become primarily a data platform. This capability first became commercially available in 1993 with the creation of short messaging service (SMS), also known as text messaging. This data service, in turn, has grown wildly popular. Today, nearly 80% of all mobile phone subscriptions include SMS text messaging. In 2009, a whopping 1.5 trillion text messages were sent worldwide, on pace to hit 1.8 trillion messages in 2010.

In March 2010, data surpassed voice on mobile carrier networks for the first time. SMS has more users than any other data application in history. This transformation of the phone into a wildly successful data platform represents an enormous opportunity both for entrepreneurial firms and the investors who back them.

The financial media overlook SMS as a growth area, probably because smartphones are inherently sexier. SMS, however, has real advantages. Not only is it far less expensive, its functionality is being steadily improved. Take, for example, Twitter’s recent acquisition of the latest blockbuster killer app, Cloudhopper. This startup’s founders, now incredibly wealthy, developed the means to send, receive and organize Twitter messages using simple SMS phone texts.

In many respects, however, mobile texting parallels the state of the Internet in its formative days. I remember well because back then, I was consulting for the company that broke open the Web, Netscape. As then, vast amounts of data are being transferred. Beyond simple usage fees, however, no one has monetized that enormous sea of information texting represents.

We know, however, that there is a need and a market for parental and corporate controls over messaging and content. We know this because profitable businesses provide those services in the realm of e-mail and the Web. Similarly, we know that mobile texts could be mined for information, just as Google and others mine e-mail sent through their systems. Nobody, however, has emerged capable of exploiting the opportunities presented by the enormous SMS market — but that’s about to change.

I’ve just come across one tiny OTC company that has the potential to bring intelligence and control to vast portions of the SMS market. And because of its tiny size, its growth could make meaningful moves for the investors who get in during the next few weeks.

Obviously, any OTC stock is too small to talk about to 400,000 Sleuth readers, but I think it would be wrong not to give you the opportunity to get into this stock at a still-low valuation. I’ll keep you filled in when things change.

For Transformational Profits,
Patrick Cox

Patrick Cox

Patrick Cox has lived deep inside the world of transformative technologies for over 25 years. In the 1980s, he worked in computer software development and manufacturing. By the mid-1990s, he worked as a consultant for Netscape — the company that handled 90% of all Internet browsing traffic at the time. InfoWorld and USA Today have featured Patrick's research numerous times. He's also appeared on Crossfire and Nightline. Patrick has been quoted by The Wall Street Journal and Reason magazine. His expertise brought him to Agora Financial, where he now heads Breakthrough Technology Alert, the only place you'll find the truly transformational technologies that offer exponential gains.

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