This week brought news of another Android Trojan, one that can listen-in on phone conversations and secretly record them. Not only are Android malware threats growing in number, but they’re getting more sophisticated (and creepier) too. Android users are two-and-a-half times as likely to encounter malware today compared to just six months ago, and three out of ten Android owners are likely to encounter a web-based threat on their device each year. That’s a huge spike in malware attacks for Android, and according to the new report from Lookout Security, attackers are getting smarter about their targeting techniques.

Lookout’s latest Mobile Threat Report outlines a range of threats spreading across the mobile industry, comparing platforms and highlighting network security. When it comes to Android, an estimated 1 million people were affected by Android malware in the first half of 2011, with the number of infected Android apps growing from just 80 in January to over 400 in June. New methods are being used by hackers and cyber-attackers, taking control of the phone to access personal data and money. Considering recent trends in mobile wallet and NFC technology, how will new attack techniques affect consumers?

“As mobile devices grow in popularity, so do the incentives for attackers, and we expect the emergence of mobile payments will be another key driver of mobile threats,” says Kevin Mahaffey, co-founder and CTO of Lookout. “At this stage malware writers are still experimenting, but in time we anticipate the threats to be more targeted and sophisticated.”

Lookout has been a prominent figure in mobile security, studying Android malware in particular from very early on. Relying on big data, Lookout analyzes apps from official and independent markets, studying the behavior of clusters of mobile apps to determine malware patterns and predicting where more attacks may occur. It’s allowed Lookout to extend its security tools beyond individual devices to cover entire markets, including Verizon’s app storefront. Lookout recently launched an API for other marketplaces to use its scanning and protection capabilities, which will become an important service as third party marketplaces continue to emerge.