Slacker Radio this week revealed that more than 1 million BlackBerry users had downloaded the personal radio service to their phones via the new BlackBerry App World. The milestone follows similar results from other Internet radio services like Pandora and Clear Channel's iheartradio, showcasing, yet again, the popularity of mobile Internet radio services on mobile phones.

Slacker CEO Dennis Mudd talks with Billboard about the milestone and what mobile phones mean to the company's future.

What is the significance of the 1 million downloads, other than just a nice round number?
I think there's a fair amount of evidence that radio on mobile platforms is growing at a very rapid rate and it seems like there's a lot of enthusiasm around the application for the customer.

Want kind of impact has the BlackBerry app had on overall traffic for the Slacker service?
We're approaching 50% of our traffic coming from mobile apps, particularly the BlackBerry.

You also have in iPhone app. How many downloads has that received.
It's less than a million.

How do you account for more downloads and traffic coming from the BlackBerry, given the popularity of the iPhone?
The BlackBerry has been a more successful application for us. We have some pretty powerful features in the BlackBerry than the iPhone. Probably the most significant is the caching feature. It allows us to save tracks from a station on the device when you're connected, and you can play it even when you don't have a connection.

Why is that ability not on the iPhone?
We have a close relationship with the people at RIM and so we focus on providing some of these key features for the BlackBerry device.

So you could have those features on the iPhone, but you decided to focus on the BlackBerry instead?
We probably could [have those features on the iPhone]. But it's difficult to do something like that without cooperation from the developer of the handset. We were able to get closer cooperation with BlackBerry that we were with Apple.

Can users buy songs via the iPhone and BlackBerry through the respective apps?
It's not available yet. We are planning to add it though. It's not that difficult to do, and it's on our list of feature enhancements. We talk to our customers on a regular basis and ask them what the most important thing them are and we're going down the list and vetting the things they care about the most.

Is there anything higher on the list you want to get done first?
I probably shouldn't talk about the feature list because it would tip our hand. But we're always working on making our service better.

What's the financial impact of these mobile apps?
We've found that mobile phones users are more likely to upgrade to our Plus version. So it's a more profitable service for us than our online service. They're driving subscriptions.

What about advertising?
We do a little bit more advertising. But up until this point, the primary impact has been subscriptions. One of the issues is service the advertising in a snappy, quick manner so it doesn't slow down the experience. It's a lot easier to serve advertisements on a Web site where you've got fast pipes and guaranteed connectivity. It's a challenge to serve advertisements in a way that doesn't undermine the experience on mobile apps. We're very concerned of course about keeping the customer experience excellent, so we're being careful about it.

Why make the app free? Even just a 99-cent download could bring in a lot of revenue given the interest in the service.
There's a huge reduction in the number of people that will try your app if it costs money. What we tried to do was have the best free app and get millions of people to download it and build a very large installed base that we can monetize. We're very happy having a small percentage of those people upgrade to a Plus version and pay a little bit of money for a better experience. But if we were going to charge money for everything, we'd have a whole different model and much, much smaller audience.

How have these app stores on BlackBerry and iPhone changed your device strategy?
Our strategy for a long time has been about personal radio and portable applications. The biggest thing that's had an impact has been the capability of the phones. Smartphones are great radio players now. My prediction is that most radio in the future will be consumed over smartphone devices. It's great that app stores are out there and it helps us get the word out to customers. But the fundamental change is the capabilities of smartphones and the high-speed networks that make it a great experience.

How does that impact your Slacker-branded device?
Our primary focus really is around cellphones. There's a part of our audience that wants to buy single-function devices, but the biggest market is around smartphones and the cellular market.

How many are using the Slacker device vs. mobile phone?
There are many, many more people using the cellular applications.

Any other handsets? Android?
We're definitely watching all the different opportunities. There are more and more phones that are capable of playing personal radio, so we're definitely watching it.