Update: Get I am T-Pain for $.99

We let you know about Smule’s recently-released I Am T-Pain iPhone app as soon as we saw it – we knew it was something special, and it turns out we weren’t wrong as the 300,000 people who downloaded it in the first few weeks of release spend around 66 minutes within the app each.

That’s an impressive statistic for any app. Not just that, but MobileCrunch reports that to date 4.1 million performances have been recorded within the app, and as a big brave thank you, Smule’s cut the price of the software to 99-cents (until Saturday morning) and has launched a competition to win big prizes for users.

Smule will also add a new song, “I’m On A Boat (featuring T-Pain) to its In-App Purchase collection later today.

And as part of a promotion, users are being encouraged to make their own music video using the song, with a finalist chosen every week for ten weeks receiving a handy $500 for their efforts.

The wining finalist will win $5,000 and a replica of T-Pain’s big gold chain.

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