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One of our favorite mobile products is ShopSavvy, the Android-based app that essentially turns your phone into a bar code scanner. It now joins the 100,000-deep library of iPhone apps.

Technically, what the app does is overlay a horizontal scanline on the camera’s viewfinder to scan an image and then scrape its product database and pull up pricing, specs and reviews. It also recently integrated local inventory data from Krillion to tell you that the Best Buy down the street has the same item for $20 less and they have four left.

This is a pretty powerful position if you think about the ability to drive and track conversions where buying intent is high — literally, when someone is standing in front of the store shelf. The app was among the winners of the first Android developer challenge and we think it represents an area of innovation we’ll see explode in mobile over the next couple years.

It will also grow to include other data sources such as promotions coupons and sponsored links. See the conversation we had with ShopSavvy developer Big In Japan about the revenue model, which includes affiliate revenue but also a Google-like bid marketplace that treats scans as search queries.

The reasons it wasn’t previously available on the iPhone involve some development roadblocks and the fact that it doesn’t work as well on pre-3GS models that don’t have an auto-focus lens. This is a downside for non 3Gs owners like me — it’s tough to get a scan. But still I’m happy to have it.

A similar iPhone app was recently released called Red Laser. It works better without auto-focus in the tests I conducted, but it doesn’t have the local inventory data that ShopSavvy has. Oh yeah, and it costs $1.99. ShopSavvy is free.

We’ll see a lot more competition bubble up in this area, and we’ll provide a more thorough comparison of what’s out there once we get our hands on the optimal hardware (upgrades forthcoming).

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