US carrier T-Mobile introduced the widely anticipated G1 phone, made by HTC, which has a touch-sensitive screen, a computer-like keyboard, Wi-Fi connections and uses Google's new Android operating system. Available in three colours - black, white and brown - it includes familiar Google services, such as Google Maps, Gmail and YouTube.
Like the iPhone and other "smartphones" the device is meant to broaden the appeal of web use on the go.
"If we see more mobile web usage we'll be happy," Google co-founder Sergey Brin said after arriving at the launch on roller-blades.
His company, a powerhouse in online advertising, would benefit if Android led more mobile users to spend time on the web, no matter which phone they are using.
Google is well ahead of rivals Yahoo and Microsoft in web search on computers, but it wants to use Android to ensure this dominance carries over to the phone when mobile web-surfing becomes more popular.
But while no clear mobile web winner has emerged so far, Google faces stiff competition from longer established phone players such as Nokia, Research In Motion's BlackBerry and Microsoft, as well as Apple.
Analysts saw the device as a "good first step" rather than an iPhone killer, but some expect as many as 400,000 to be sold in the US by the end of the year.
A T-Mobile executive said the estimate was "not incredible."
The first step
When it becomes available to US consumers on October 22, the G1 will sell for about $US179 ($214) - slightly cheaper than the entry-level price of $US199 ($230) for Apple's iPhone - with a two-year contract.
The G1 will be launched by T-Mobile's UK unit in November and other European countries such as Germany, Netherlands and the Czech Republic in the first quarter of 2009.
"The G1 doesn't threaten Apple now, but Android has raised the bar for competing mobile platforms. The bigger concern here is for Microsoft and Nokia if Google can win over the hearts and minds of operators and developers," said Geoff Blaber, an analyst with British firm CCS Insight.
It is not clear when Australia will see a phone running Google's Android system. 12 hours before the international unveiling of the Google phone, handset manufacturer HTC held a launch in Sydney for the Touch Pro, a product unrelated to Android.
"We have no explanation as to why Australia is not introducing the Google phone," an external HTC PR spokesperson told SmartHouse Magazine.
When asked about the Australian release, a Google spokesperson told NEWS.com.au the T-Mobile phone was just the beginning.
"Our hope is that that Android platform will spur the development of thousands of different kinds of devices. The T-Mobile G1 is just the first step.
"It's still too soon to tell what forms Android-powered devices will take, but we're excited about the possibilities this kind of open platform will bring, and the benefits that users will ultimately enjoy."
Open source
Both Google and Apple are wooing developers to create applications for their devices, but unlike Apple, which keeps a tight grip on the iPhone's hardware and operating software, Google's Android is open to be changed by outside developers.
Asked if the user interface of future Google phones would look anything like the first one, Andy Rubin, who developed Android for Google, said: "Its completely replaceable."
For example, T-Mobile US product development vice president Leslie Grandy saw the carrier selling a range of Google-powered phones in future, including more basic ones without a touch-screen or full keyboards.
The new phone features Android Market, where customers can find and download free applications to expand and personalise their phones.
Mr Grandy said the marketplace would eventually include applications that are sold for a fee.
"Because the platform is open, we think Android is somewhat future proof," Mr Rubin , Google director of mobile platforms, told the audience at the launch.
A similar strategy helped increase the buzz around Apple's second-generation iPhone, which can support more than 3000 applications available online.
Amazon.com's digital music store will be loaded on the G1, allowing users to search, download, buy and play more than six million songs, pitting it against iPhone's music player.
The competition
Android also competes with Microsoft's Windows Mobile operating system, which has been solidly gaining ground.
HTC chief executive Peter Chou said his company, which has concentrated on Windows phones so far, is already planning more Android and Windows devices.
Mr Chou said he expected to have sold more than 400,000 G1 by the end of the year.
Android's biggest competitor is Symbian software, which represents 60 per cent of the smartphone market and which Nokia plans to buy out and open to other developers.
Nokia, which has about 40 per cent of the mobile phone market, has also branched into mobile web services such as mapping that compete directly with Google.
Speaking at a conference in Chicago this week, Nokia chief executive Olli-Pekka Kallasvuo said he was not worried by new competition.
"The entry of Apple and Google - in fact today in a very concrete way - in mobile communications is the best possible illustration of the fact that there's a lot of possibility here," he said.
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