• by Mark Walsh  @markfwal, February 4, 2009

"It's the difference between night and day," said Jamie Wells, mobile director at OMD's Ignition Factory, describing how the iPhone has altered clients' attitudes toward mobile advertising during a panel on "The Smartphone Revolution" at the AlwaysOn OnMedia NYC event.

Wells explained that instead of struggling to sell agency clients on the benefits of mobile advertising, they are "knocking down the door" to run mobile campaigns since the launch of the $200 iPhone 3G last July. How come? "Basically, because everyone in the industry has an iPhone," said Wells. Actually owning the device has helped brand marketing and agency executives to grasp the potential of a user-friendly phone that combines Web access, email and a wealth of useful mobile applications.

"The iPhone is a real watershed moment because now you have the whole creative industry excited about mobile," added Wells, whose agency's clients include Pepsi, Visa and H&R Block.

Internet radio service Pandora saw a similar boost to its mobile business after the iPhone came out. In just two days, the company gained more mobile users through its Pandora iPhone app than in two years through distribution deals with Sprint and AT&T on 50 different handsets, according to the company's founder Tim Westergren.

Prior to the iPhone's advent, he said the company had to customize its service for the wide variety of mobile phones because of the chronic lack of standards that has slowed the industry's growth. "We've been looking for a hero device," he said. "As a company now, we're thinking, 'what's the next iPhone?'"

Eric Litman, CEO of Medialets, which is among the mobile ad companies that have developed ad networks around iPhone apps, also welcomed the change from having to offering content through the major wireless carrier decks. "Given this new distribution model, there are real opportunities for companies to hit scale, whereas...building relationships with carriers to date has been a challenge."

Apple says that more than 500 million applications have been downloaded from its App Store to date.

Having to sit politely through all this iPhone worship was Marco Argenti, vice president for media at Nokia, the world's largest handset maker, but one that has yet to gain ground in the U.S. Rather than view the iPhone's success coming at Nokia's expense, Argenti framed it as a plus for the entire smartphone market.

"All the buzz about the App Store demonstrates that there's a very huge demand for everyone that has an advanced phone, to do more with it," he said. Argenti emphasized Nokia's commitment to open operating systems on mobile phones as well as full Web browsing and mobile media efforts, including its Comes With Music initiative.

Nokia and other smartphone makers, including BlackBerry and Palm, have either opened or plan to launch their own app stores to better compete with Apple.

While Westergren said he welcomed efforts toward opening up the mobile landscape, he said Apple's closed system for the iPhone has shown that being more open is not necessary for success at this stage. "It depends on where you are in the marketplace," he said, suggesting that Apple could maintain a closed system for now the way AOL did in the early days of the Web.

"The losers are the ones that don't keep it simple," said Westergren. "Companies that make things drop-dead simple are the ones that will win over and over again."

Asked about what would be the headline a year from now about mobile in 2009, Wells suggested "'Mobile Weathers The Storm'" (no reference to the Verizon Wireless smartphone, of course.) "Mobile is really starting to feel its growth," he said. "And the fact that it's picking up in a profoundly down market like this is really pretty striking."