SnapMyLife, a web site for sharing photos over cellular phones worldwide, reeled in $5 million in financing to roll out new product features and stretch its global reach. Owned by mobile content distributor Mobicious, the Needham, Mass. company hopes to capitalize on the popularity of photos on social-networking sites to bring in revenue from relevant ads.

The application’s users can not only make friends and share their photos (taken on their phone or by a digital camera), but also tag locations to show up on maps, comment on others’ posts and chat with fellow users. Right now, the SnapMyLife web site draws about 1.5 million unique visitors a month, and more than 500,000 registered users in nearly 200 countries. The service can be used on any phone with camera capabilities and access to the mobile web. It also offers an iPhone application for free through the App Store, but it only garners a three-star rating from 48 reviewers.

The site is far from alone in the mobile photo-sharing space. A laundry list of other companies, including Cellblock, Treemo, Juicecaster and Radar (just to name a few), all allow users to snap photos and share them with their personal networks via their handsets. In an environment where most contenders allow users to share a range of media (including video and audio), its unclear how SnapMyLife will differentiate itself from the pack. While it emphasizes its tagging and filtering capabilities, the competition is either already there or just a step away.

It’s an interesting choice for investors North Bridge Venture Partners and Carmel Ventures, which led the round. Maybe they are placing their bets on Mobicious — a successful one-stop-shop for apps, ringtones and other trendy content — and where it could take the service as it develops in coming months.

Update: After speaking with SnapMyLife founders George Grey and David Chang, its clearer how the company plans to develop a unique service. Not only is the application used more globally than the competitors mentioned above (with 20 percent of its user base in Africa, and 30 percent in Asia), but its also tailored for exclusive use on mobile handsets. For this reason, it’s designed to work on almost any model of phone, including the cheap or even free varieties popularized in developing countries.

Its goal is to pull in segments of the photo-sharing market that access the internet almost exclusively through their phones. For this reason, SnapMyLife’s target demographic is a bit older, with new users generally in their 30s and 40s and even 50s and 60s. These are the parents and grandparents of the tech-savvy generation — the ones who don’t understand why you would want to spend your life in front of a screen, but still carry their phones at all times and want to view photos. According to Grey, gaining traction with this demographic has made moderating and filtering content a key priority. Peers like Treemo and Cellblock, Grey says, are more aimed at 18 to 24-year-olds, and feature content that may not be appropriate for SnapMyLife’s core audience. It uses a combination of Amazon Mechanical Turk moderators and its own technology to filter out questionable photos — which should also make it a more attractive proposition for advertisers, Grey says.

Additionally, services like Radar only allow users to swap photos with designated friends, whereas SnapMyLife lets people post their photos publicly, making it a little like Twitter in the sense that it lets you find cool items more generally and forge connections with strangers all over the world.

As for its low iPhone App Store rating, if you look at the top 20 photo-sharing apps, the majority don’t break the 3-star score. Grey attributes this to memory limitations inherent to the iPhone that should be improved with later software updates.

Given this, it’s probably not such an outside bet for investors after all.