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The Gphone Is No iPhone Killer

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Google (Nasdaq: GOOG  ) has finally launched its foray into the smartphone market. Heavy on hype, the G1 phone will hit the market next month.

Starting at a subsidized $180 through Deutsche Telekom's (NYSE: DT  ) T-Mobile (with a two-year contract), the new device is certainly priced competitively relative to Apple's (Nasdaq: AAPL  ) iPhone.

However, how will G1 owners feel when they find out that the company behind YouTube has sold them a phone without a built-in video player? Heck, even the iPhone plays YouTube videos -- with a Flash workaround -- out of the box.

The G1's strongest selling point will be its retractable keyboard. Anyone who's ever had to type anything longer than a line or two on an iPhone will tell you that the clumsy touchscreen keyboard is one of the iPhone's few flaws.

A nifty keyboard isn't enough to slay Apple, though. If anything, it positions the G1 against the texting-friendly BlackBerry from Research In Motion (Nasdaq: RIMM  ) .

The first wave of G1 reviews are mostly positive. Google apparently has a winner with its Android operating system. Taking a page out of the Apple playbook, the phone even has access to a Google-fied App Store. That's certainly nice, but program developers will want to see whether the public takes to the new phones before committing resources to it.

That point may become moot as other phones launch around the Android platform. The G1 may -- or may not -- sell briskly next month, but Google's in this for far more than just this one handset. That's important, because cell-phone owners can be fickle. Anyone remember when you weren't cool unless you had a Motorola (NYSE: MOT  ) RAZR? A year ago, Nokia (NYSE: NOK  ) was the toast of the town with 40% global market share. It's still the world leader, but you just don't hear a lot of Nokia chatter domestically.

We certainly live in interesting times. The playing field is changing so quickly that even those two-year contracts may seem like prison sentences compared to the cool smartphones we'll be buying come 2010.

Welcome to the game, Google. Now get back in line.

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Google is a Motley Fool Rule Breakers pick. Apple is a Motley Fool Stock Advisor recommendation. Try any of our Foolish newsletters today, free for 30 days

Longtime Fool contributor Rick Munarriz is mildly intrigued by the G1, but not enough to loosen his iPhone grip. He does not own shares in any of the stocks in this story. He is part of the   Rule Breakers newsletter research team, seeking out tomorrow's ultimate growth stocks a day early. The Fool has a disclosure policy, and it knows that roaming charges weren't billed in one day.

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