Google has retooled AdWords to offer AdWords text and image ads for Mobile Safari on the iPhone. The ads will be available in the future on other mobile devices supporting full (HTML) Internet browsers. Ads will support mobile specific calls-to-action and the ads can be created from currently existing standard Google ads running currently on the Internet.
The advantage of the full HTML browser phones is that the ad links can like before point to regular web pages. Google's pitch is that any advertiser can run a single ad campaign across all Internet-enabled devices. They can then analyze the results on either platforms to determine where their ad is receiving the most or best response.
More information about new mobile device support for AdWords can be found on the Google Mobile blog.