Over at ArsTecnica, a technology site, there is a good article about how and why you should want to protect the data on your smartphone. Here is a snippet:

Exhaustive cell phone searches aren’t exactly commonplace today, but they’re growing more and more frequent as law enforcement begins to realize how much incriminating information modern smartphones tend to contain. The rapidly growing digital forensics industry already offers a range of tools to law enforcement designed for pulling data off of mobile phones, and entire books have been written on such topics as the forensic analysis of the iPhone operating system.

Unfortunately, few consumer-grade smartphones support full device encryption. While there are numerous smartphone apps available for encrypting particular types of files, such as emails (i.e. NitroDesk TouchDown), voice calls (i.e. RedPhone), and text messages (i.e. Cypher), these “selective” encryption tools offer insufficient protection unless you’re confident that no incriminating evidence exists anywhere on your smartphone outside of an encrypted container.