From this summer businesses will be able to advertise through Apple’s iAd platform, accessible to the world’s 50 million iPhone users. It will operate in applications that users download on their phones and enables companies to supply relevant adverts to their location. According to IT research company Gartner, the sector will grow by 78 per cent by the end of 2010.

Meanwhile, Google is awaiting approval from the US Federal Trade Commission for its proposed $750 million (£495 million) takeover of mobile advertising agency AdMob. If it goes through, the acquisition will give Google the ability to serve display ads, a major revenue source for most websites, to mobile phones, representing a breakthrough in its war with Apple to become the market leader.

However, the technology giants are not the only players poised to crack open the mobile phone advertising market. Telecoms company Alcatel-Lucent has developed a platform for businesses to advertise via text and is currently partnering with mobile phone operators (so far it has teamed up with ones in France and Germany) in a bid to increase its user base.

Thomas Labarthe, vice president of mobile advertising at the company, says: ‘When you look at the mobile ad market you can divide it into three categories: display banners on websites, search advertising and message-based. We’ve decided to concentrate on targeted texts, which means you have to ask the end user’s permission as to whether they would like to opt into the service first.’

But Labarthe admits that users were initially suspicious of being inundated with text advertising in its market research trials. ‘When we specified that users will be in control of the process and can filter ads to suit their own preferences, the response was positive with more than 50 per cent saying they would use it. We then decided to work exclusively in this area,’ he adds.

Although it’s still very much early days, Labarthe is upbeat about the advantages to business. ‘The main benefit to companies is that the campaigns are a form of direct marketing in that they will target specific demographics, engage with them and build loyalty,’ he says.

See also: How to run an effective online advertising campaign