Google unveiled its first mobile phone last night to take on its rival Apple.
The Nexus One handset uses software designed by the internet giant and will take on the dominant iPhone, which is used by 25million people worldwide.
Its launch, coupled with the launch of an internet store for customers to purchase the phone, is likely to prompt an explosive marketing battle between Google and Apple for supremacy.
The Nexus One has 3D features such as moving wallpaper and harnesses Google creations such as Google Streetview, Latitude and Gmail
Technology experts believe the next three years will provide the key battleground as to who will dominate the handheld gadget market.
As a result of innovations such as the iPhone, fewer devices are needed to perform an array of functions such as listening to music, watching TV, playing games and talking on the phone.
Mario Queiroz, Google's vice-president of product management, launched the phone at a press conference in California yesterday.
'It is the next step in Android evolution. It is where the web meets the phone,' he said.
Android is an operating system developed two years ago by Google for other companies to use its apps.
People in the U.S. can buy an unlocked version of the Nexus from today for $529 (£331) or with a T Mobile contract for $179 (£112).
Unlocked means customers can use any Sim card whereas with the iPhone user is the UK must have phone package from one of three providers.
The Nexus will be available in the UK through Vodaphone this spring, although no exact launch date was given.
The smartphone has similar dimensions to the iPhone and is 11mm deep and weighs 130g.
However, not only does the Nexus have a bigger screen (3.7in compared to the iPhone's 3.5in) - it also has an OLED screen. This gives brighter colours and better contrast than the iPhone's LCD screen.
The Nexus should also take better pictures with a 5MP camera with LED flash, compared with iPhone's 3MP camera.
Nexus One has a 1GHz Snapdragon processor, which means users will be able to use multiple apps without losing any speed. This is far more powerful than the 600 MHz processor on the iPhone 3GS.
It runs on Android 2.1 - the latest version of Google software. This offers Google Maps Navigation, which effectively acts as a car sat-nav, multiple Gmail accounts and thousands of applications through the android market.
Other features include a trackball that pulses one of three colours to indicate an incoming e-mail, call or text message.
There are two microphones on the Nexus, which Google says cancels out background noise allowing a clear call on a busy street. The phone will also recognise when it is moved from outside to inside and will change screen brightness accordingly.
Google product manager Erick Tseng said they were also eager to show how '3D' could add to the phone user's experience.
'You really have a mini computer in your pocket,' he added.
'We wanted to show just how far 3D has come. We have live wallpapers that have a ripple effect, desktop icons with added depth and a new gallery application where you can tip photos away from you to get a better view.'
Another new application uses voice recognition, so phone users can talk into the phone and the Nexus will type out their speech.
This can then be e-mailed or texted to others. Google said the app would be 'trained' to the user's voice the more it was used.
The iPhone doesn't have this function built in, but there are a number of applications in the App store that will turn your voice into text.
No one at Google would be drawn on whether the Nexus One would live up to its billing as an 'iPhone killer'.
'It's a "super phone", and it provides choice for the customer,' said Mr Queiroz in response.
The Nexus One is currently only available to customers in the U.S. Britons must wait until the spring before they can buy one
The Nexus One is named after a type of ‘replicant’ cyborg in Ridley Scott’s cult science-fiction film Blade Runner. It has a sci-fi looking two-dimensional bar code on the back which identifies each handset.
View from the rear: The phone's five-megapixel camera lens sits above a unique two-dimensional bar code
Google's phone is a big step for the search giant that, until now, has offered phones only in partnership with other companies.
It set its sights on developing its own so-called ‘smartphone’ because they are becoming an increasingly important way of accessing the internet.
As more people go online using their mobile phones, the firm aims to deliver more ads to them.
The search engine giant hopes to take on Apple’s iconic iPhone, which has become, since its launch in 2007, the benchmark in the rapidly growing market.
Google revealed its open-source Android operating system nearly two years ago.
Until now, the company has been content to let other companies such as Samsung and Motorola design devices relying on Android.
And those devices thus far have largely been distributed like most other mobile phones, tethered to major wireless carriers which typically require buyers to lock in to contracts in return for discounts on the handsets.
But Google now appears to be ready to push its operating system in a new direction while trying to give consumers more flexibility to connect a mobile phone with the wireless carrier of their choice.
The Google briefing is likely to overshadow the opening tomorrow of the world's biggest gadgets show, the Consumer Electronics Show in Las Vegas.
The next development from Apple, to be released later this month, is expected to launch a tablet-style computer, possibly called the iSlate.
Google co-founders: Sergey Brin (left) and Larry Page will present the phone today at their California HQ
For more information visit the Google web store
First technology reviews
TechCrunch: This is the best Android powered phone to date. It’s also the fastest and most elegant smartphone on the market today, solidly beating the iPhone in most ways.
If you are looking to buy a high-end smartphone right now, this is the phone for you.
Positives:The screen is bright and alive, and an absolute pleasure to use.
Negatives: All this hardware bling is an energy hog. The battery life is woefully brief, even by iPhone standards.
CNET News: It's a good phone, but does it break new ground for consumers? Not so much.
Positives: It has active noise cancellation and voice control, both very cool. It has nice integration with online services like Google Maps and Facebook.
Negatives: It's not revolutionary the way the iPhone was.
Engadget: The Nexus One is at its core just another Android smartphone. It's a particularly good one, don't get us wrong - but it's not in any way Earth-shattering.
Positives: The handset generally feels trimmer and more svelte than an iPhone. Camera a big improvement and we loved the Gallery application.
Negatives:OLED screen has problems with colour balance. The reds and oranges seemed overblown and saturated. The phone is fast but not so much of a leap up from the Droid that we were expecting.
TechRadar UK: Irrespective of all this Google hype it is still an awesome phone.
Positives: In our eyes, it's the perfect size for an internet and media glutton. The Snapdragon processor is a nippy beast.
Negatives: Multi-touch pinch and zoom is not included. How can a phone compete with Apple's iPhone if it doesn't perform its coolest tricks?