American Idol — the talent show turned cultural icon — is more than just entertainment. The show is also a crash course in mobile media. In the 2008 season, the show generated 78 million text messages from viewers voting for their favorite singer. Even more startling: 22% of voters claim they first learned to text message by voting for their American Idol, according to a poll conducted by the network.

The text message explosion began between 2005-2007. The number of SMS messages grew from about 10 billion to more than 48 billion per year then. And texting isn’t the only huge mobile trend you’ll have to contend with…

Mobile phones have come a long way from their humble beginnings. Now your phone has become an entire media platform. The possibilities are endless…

The iPhone Changes the Game

With the staggering growth of content available on mobile phones, it’s no surprise that the mobile advertising industry is picking up steam. The first step was paid content. Mobile users could text certain numbers to download ringtones and other content for a small fee. Now we’re seeing advertisers take advantage of the new capabilities of smart phones like the iPhone, the BlackBerry Storm and the T-Mobile G1.

Back in 2007, the new iPhone got off to a rocky start. AT&T — the iPhone’s exclusive carrier — announced the disappointing data right after the release. Customers activated only 146,000 iPhones during the first weekend, much less than the 500,000 activations predicted by giddy Wall Street analysts.

Since then, we’ve seen a newer, cheaper, faster iPhone hit the market — this time on a 3G network. And AT&T has finally managed to favorably work the iPhone into its rotation — even with the hefty kickbacks it sends to Apple for its trendy multimedia device. Yes, AT&T has sunk some serious dough into this affair, including $450 million on 3G network upgrades, according to Forbes. These expensive improvements were a major factor in the 23% year-to-year decline in the company’s net income last quarter…

But the 3G iPhone is finally beginning to bear fruit. AT&T has so far activated 4.3 million of the second-gen touch-screen phones— 1.9 million of them in the fourth quarter, according to Forbes. This more than doubles last year’s activation numbers — and nearly doubles Verizon’s activation data for the new BlackBerry Storm.

Believe it or not, the iPhone has changed something… it has changed the way we consume media. AT&T’s wireless division CEO says it best: “The success of our iPhone 3G launch has driven wireless growth and helped redefine the wireless data space.” As these mobile devices become increasingly ever-present, there’s no doubt that advertisers and developers will find new ways to capitalize on this growing media consumption.

Best,
Greg Guenthner

February 2, 2009

Greg Guenthner

Greg Guenthner uses his experience as a former journalist to dig up the hard-to-find headlines that could lead to big gains for your micro-cap portfolio. Greg offers his readers the scoop on topics ranging from alternative energies to biotechnology, digging up the best penny stock opportunities before they’re discovered by the mainstream media. On top of contributing to Penny Sleuth, Greg also heads Penny Stock Fortunes and Bulletin Board Elite. Special Report: Imagine Getting Rich as Ignored Stocks Soar - You could turn $200 into $1.2 million!

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