The second new service is the SMS Ad Exchange, which lets an advertiser or content provider insert an ad or promotion or other marketing message at the end of selected SMS messages. Keeping with the above example, the ATM directions might have a link to information about a new certificate of deposit or other offer from the subscriber's bank.

The service is currently in beta test, with availability due by the end of March.

Enterprises, rather than ad agencies, are in the forefront of applying SMS advertising in practical ways, says Marty Beard, president of Sybase 365. "They're using it to communicate to customers and users information about [such things as] promotions, customer service, upgrades," he says. The new Ad Exchange service will let them track, target, and execute different messages to different groups at different times and frequencies.

According to Nielsen, SMS advertising is something mobile subscribers actually appreciate. Among text messaging subscribers who recalled seeing some form of advertising in a text message, 45% say they responded, according to Nielsen, an astonishing response rate. The most popular response in Q2 of 2008 was to send a text message: "25 percent say they responded at least once by sending another text message--emphasizing the interactivity and engagement this medium presents," according to Nielsen.