TECHPULSE The web is brimming with speculation now that Google has launched its first hardware product, the Nexus One aka the "Superphone", putting the Mountain View, Calif., company in direct competition with other smartphone players in the marketplace.

But it's not going to be an easy ride for Google because Apple, the innovative Cupertino, Calif., company, is already a powerhouse in the high-end smartphone market with its top-selling iPhone. Reseach In Motion (RIM) is another major player with its popular Blackberry.

Would Apple and RIM move over and watch Google pass them by?

In a world of shifting computer technology, staying ahead as a market leader is a challenge that no self-respecting company could ignore. Who wants to be overtaken and be left in the dust?

According to industry tracker IDC, the bestselling smartphone in the US so far last year by units is not the iPhone but the BlackBerry Curve. RIM's Blackberry, once considered mostly as a business tool, has made huge gains as a consumer product. Its sales are still accelerating.

IDC puts the worldwide sales of mobile phones at 1.19 billion in 2008 of which about 155 million were smartphones, or 13 percent. IDC is forecasting that 20 percent of the 1.4 billion phones that will be sold in 2013 will be smartphones, or 280 million.

On all counts, it reads as good news for both RIM and Apple that the overall smartphone market is growing faster than ever. Not forgetting that Google wants a piece of the pie, too, as market analysts are wont to believe.

Whole new ballgame

Before, Google and Apple have very different market strategies - one sells ads, the other sells phones. The Google phone is telling everyone there is a whole new ballgame in the park.

Major competitors like Apple and RIM are already locked in a smartphone battle for market share. They know very well that when Google enters the fray, it's not going to pay to ignore the search giant.

Market analysts say the competition is about to get tougher.They see this as a "move to the next frontier" for Google whose name has become a household word and a verb commonly used when people do search on the Internet.

It should come as no surprise that Google has decided to move into a territory that's considered a far cry from the type of business that the search engine behemoth has been doing since it was founded by two Stanford University students, Larry Page and Sergey Brin, on Sept 4, 1998.

Despite the smartphone market being a new turf for the search giant, market observers believe Google has the technology savvy and financial muscle to stake a place in the wireless industry and do well.

Analyst Michael Gartenberg of Interpret says: "It's all about the mobile web, and advertising is their bread and butter...It's the latest salvo from Google on the wireless industry. The landmark news here is that Google is now a consumer electronics retail company."

Fortune magazine reported recently that Google has become the world's largest search engine with roughly US$22 billion in annual revenue, building a multi-billion dollar Web empire unrivalled in the history of the Internet mainly through its ingenious sales of small text ads that appear on millions of websites and blogs.

The answer is obvious

In recent years, Google has seen rapid growth with acquisitions and partnerships that goes beyond its core search engine and advertising business. So far, Google had orchestrated a string of acquisitions of companies with mobile-related technology, including Android. According to the official Google Voice blog, the acquisition of VoIP service Gizmo5 in November last year was to continue improving the Google Voice and Gizmo5 experience. Gizmo5 provides Internet-based calling software for mobile phones and computers.

The intriguing question is what next for Google? The answer is obvious.

The explosion of the mobile Internet, brought about by the rapid emergence of the smartphone, has provided Google with a great opportunity to enter the marketplace with its own mobile product. According to market analysts, Google has foreseen the coming of age of the mobile phone industry.

Google's CEO Eric Schmidt has been reported as saying that the mobile Internet is the company's biggest opportunity for new growth. As the most powerful brand in the world, Google's business activities are closely followed by industry watchers and they have noted that it has invested far more aggressively than its compeititors in mapping technologies and Web services.

David B.Yoffie, a professor at the Harvard Business School, told the New York Times: "The new paradigm is mobile computing and mobility...That has the potential to change the economics of the Internet business and to redistribute profits yet again."

Analysts are saying that Google understands its leadership role may be put into question if online advertising loses its economic steam in the face of the paradigm shift to the mobile Web as more and more people rely on powerful smartphones to access the Internet.

The Nexus One, the Android-based mobile device built by Taiwanese company HTC according to Google's specifications, could be seen as a forerunner of other mobile ventures on Google's radar with a lot at stake for the search giant as it is determined to become a force in mobile advertising.

According to Android news expert Michael Martin, Google has made significant progress with Android phones especially with the Droid and most recently with the Nexus One. Google is also pushing its latest 2.1 version of the Android mobile operating system to broaden the appeal of its technology.

Google may be No. 1 in search but some observers wonder is there the risk that Google will perform poorly in its new ventures? Analysts think it is "tolerable" for a corporate giant with a market share of around 65 percent and a market capital of about US$190 billion. No doubt, it can afford a misstep or two.

Making 'more enemies'

Google executive Andy Rubin, the brains behind the Android operating system, told Wall Street Journal's Walt Mossberg in an interview that the next version of the Nexus One would be for enterprise users and might have a physical keyboard. That sounds like a warning to Blackberry maker RIM who enjoys a strong position in the enterprise cell phone market.

While speculation is rife about Google's intention, there are also rumours that it may have something else up its sleeve. Is a true Google smartphone in the works that would be free from any mobile carrier? Judging by Google's recent moves, there actually could be some truth to the rumours.

If indications are true to form, Google has stepped up its expansion plan and making "more enemies" than before. On the media front, Google is facing a grudge match with old-school newspaper czar Rupert Murdoch over the contentious issue of payment for online content. On the the hardware front, Google's plan to sell the Nexus One through its own online store could affect sales of Apple's iPhones, say analysts.

No matter how you view it, the Nexus One looks like a serious competitor to the iPhone although some industry watchers have doubts that the Google phone could be an "iPhone killer". Maybe not yet, but analysts do believe Google will force Apple to step up its game. Market analysts are looking at a scenario where Google and Apple are on a collision course.

According to a NYT report following the unveiling of the Nexus One, Apple has announced that it had acquired mobile advertising start-up Quattro Wireless, indicating that it has plans to attack Google's core advertising business. It would not be too far wrong to see this as a tit-for-tat move.

Pricing and service fee will play an important part in the marketing of the smartphone apart from other considerations. Analysts expect new battle lines to be drawn as the major players go head to head in the smartphone war that could shape the future of how people acquire information from the Internet.

* Mark Khoo writes about the blogging experience and keeps up-to-date with the currents on the World Wide Web. He blogs at TheNextPost.com  and Markkscript.Posterous.com