Handset users are more aware of mobile advertising, with 38 percent recalling seeing an advertisement on their device, according to a study by Brightkite.

The quarterly Brightkite Mobile Advertising Report also found that 59 percent of smartphone recalled seeing mobile advertising. The most striking finding of this report is the mobile advertising formats that consumers are noticing: 23 percent of smartphone users recall seeing SMS advertising, 20 percent saw ads in mobile social networks and 15 percent saw ads in mobile TV/video.

"The most surprising finding was the growth of mobile advertising outside of mobile web and SMS formats, which have previously dominated the medium. Ads inside of games, social networks and location based services are all recalled by significant numbers of consumers and growing faster than other formats," said Rob Lawson, chief marketing officer of Brightkite.

Brightkite's location-aware mobile service helps connect users with friends and share real world experiences. More than 2 million people use Brightkite's free service every month.

GfK Technology, a market research agency, helped Brightkite with conducting this research.

In just three months, the number of smartphone users seeing ads inside a location-based network has almost tripled to 15 percent.

At current growth rates, Brightkite expects to see some of these formats surpass mobile Web and/or SMS in 2009.

Also, since carriers are currently developing more and more smartphones, adoption will most likely increase and so will advertisement awareness. Smartphones provide users with a Web-like experience, more so than feature phones.

In addition to being more aware of mobile advertising, phone users are quickly adopting a much broader set of mobile services. In fact 14 percent now use one or more location based services (peaking at 38 percent of iPhone users).

Also, 10 percent use a mobile social network (33 percent of iPhone users).

The fastest growing application for iPhone users is games, which experienced a 21 percent growth quarter over quarter. Half of all iPhone owners are now playing games on their phone.

This growth is fueled by the unique features of the device.

"The good news is that more and more consumers are recalling mobile advertising," Mr. Lawson said. "The proliferation of new formats, especially for smart phone users, establishes a real opportunity to treat the medium more creatively."