T-Mobile, Google show off G1

In the latest of a string of challenges to Apple's iPhone, Google and T-Mobile on Tuesday introduced the first mobile phone powered by Google's Android software, which they hope will bring PC-like features to millions of cell phone users.

Like the iPhone, the G1 has a large touch screen. But it also packs a trackball, a slide-out keyboard, and easy access to Google's e-mail and mapping programs.

T-Mobile said it will begin selling the G1 for $179 with a two-year contract. The device hits U.S. stores Oct. 22.

The phone will be sold in T-Mobile stores only in the U.S. cities where the company has rolled out its faster, third-generation wireless data network. By launch, that will be 21 cities, including New York, Los Angeles, Houston and Miami. No areas in the Carolinas are expected to be covered by T-Mobile's 3G network by Oct. 22, according to the company's Web site.

In other areas, people will be able to buy the phone from T-Mobile's Web site. The phone does work on T-Mobile's slower data network, but it's optimized for the faster networks. It can also connect at Wi-Fi hot spots.

The data plan for the phone will cost $25 per month on top of the calling service, at the low end of the range for data plans at U.S. wireless carriers. And at $179, the G1 is $20 less than the least expensive iPhone in the U.S.

Android, the free software powering the G1, is crucial in Google's efforts to make its search engine as accessible on cell phones as it already is on personal computers. The company believes it eventually might make more money selling ads shown on mobile devices than the $20 billion it will make this year from ads on PCs.

Like the iPhone, the G1 has a high-resolution screen, making it easier to browse Web sites that haven't been specifically adapted for a cell phone. Unlike iPhones, BlackBerrys and most other high-end smart phones sold in the U.S., the G1 has a very limited ability to connect to corporate e-mail servers. That means the device's initial market is likely to be consumers.

The G1 doesn't do much that other high-end phones don't already do. But Google is counting on the device unleashing the creativity of software developers, who are free to write applications for it.