Taking advantage of the spotlight beaming on last week's Google I/O conference, Google (Nasdaq: GOOG) presented a much-anticipated and pretty darn powerful update to its Android mobile operating system.

Android 2.2, or Froyo (short for "frozen yogurt") for those who prefer Google's dessert-oriented code names, is more than just another bunch of bug fixes and minor features. I told you last year that Android versions don't matter much, but this one does like a Droid.

The killer feature in Froyo is the one-two punch of tethering and Wi-Fi hotspot support. In the first case, you can hook your updated Android phone up to your computer and enjoy the Internet through the phone's 3G (or 4G) connection. In the second, the phone becomes a Wi-Fi router on demand, providing wireless connectivity for up to 8 client devices. These features are also available from Verizon (NYSE: VZ) Wireless, AT&T (NYSE: T), and Sprint-Nextel (NYSE: S) today -- but then you need a separate gadget with its own data plan. Palm also made hotspot capability a key selling point of its recent Palm Pre Plus phone. Web blog TechCrunch confirmed that Android 2.2 can be modified in several ways to make tethering support a paid feature, so it remains to be seen how much longer carriers will continue trying to wring extra costs out of these features.

There's much more, including a severe speedup of both the operating system and the web browser, expanded support for those business-friendly and nearly ubiquitous Microsoft (Nasdaq: MSFT) Exchange servers, and built-in Adobe (Nasdaq: ADBE) Flash support. But again, the connection-sharing power looks like it could be a game-changer, a killer app, a reason to throw away your Apple (Nasdaq: AAPL) iPhone and get an Android. Verizon started enabling the hotspot feature on Palm Pre Plus for free, so the thought of carriers opening the door to these features has some precedent.

Froyo is not only theoretically available, but has already been installed on review copies of Google's own Nexus One phones. Handset manufacturer HTC promises to update all of its recent models to Froyo in 2010, and Google engineers say that every one of its Android handsets all the way back to the ancient G1 should be capable of running the software. Independent tests note that the speedy code breathes fresh life into old gadgets.

These days, Android versions do matter, and you really want Froyo if you can get it. This release is chock-full of selling points and should accelerate Android's already hasty market adoption. Will service providers throw a collective fit over Google's audacious free features overriding their own paid services? If not, then Google will change the business model of wireless phone services after all.

What's not to love about Froyo? Cry havoc and let slip the dogs of war in the comments below.

Fool contributor Anders Bylund owns shares in Google, but he holds no other position in any of the companies discussed here. Yes, he knows that you can make nearly any smartphone into a 3G hotspot, but it's way beyond the ken of your average user and doesn't count. Microsoft and Sprint Nextel are Motley Fool Inside Value recommendations. Google is a Motley Fool Rule Breakers choice. Apple and Adobe Systems are Motley Fool Stock Advisor recommendations. Motley Fool Options has recommended a diagonal call position on Microsoft. Try any of our Foolish newsletters today, free for 30 days. You can check out Anders' holdings and a concise bio if you like, and The Motley Fool is investors writing for investors.