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The unveiling Tuesday of HTC's much-anticipated G1 handset for T-Mobile, the first device running Google's (Nasdaq: GOOG) Android mobile operating system (OS), looks to be the opening salvo in a battle for smartphone consumers between Google and Apple (Nasdaq: AAPL).
Although the first-generation G1 and second-gen iPhone are not exactly the same, the two handsets offer consumers many of the same features and functionalities. Both phones have a wide touchscreen, a music player and a camera. The smartphones, which can run on high-speed 3G networks, also offer Internet access and a Web browser, usable over either the cellular network or WiFi.
Buying what is essentially a mini computer, however, is about more than just features and functionality. Many other factors come into play, such as available 3G network coverage from the respective carriers; price and features of the available data plans, and the differences between Apple's App Store and the upcoming Android Marketplace.
"The G1 will have to prove itself to the consumer base beyond early adopters and tech-savvy digital natives. It has some of the interface things of that you see on the iPhone but not all of them. So, how is this going to be sold at retail 
? What's the value that T-Mobile is going to have to do in the stores or online to get people to look at the G1?" Michael McGuire, a Gartner (NYSE: IT) Research analyst, told TechNewsWorld.
G1 vs. iPhone -- The 3G Network
T-Mobile lags behind U.S. iPhone carrier AT&T (NYSE: T) in the process of rolling out its 3G network, which offers users faster download and upload speeds than the carrier's more prevalent EDGE network.
"AT&T has a much more extensive 3G network than T-Mobile has, but T-Mobile came late to the game. They announced ... 16 markets now and will have [more] by the time the phone launches in October. That's much more limited than the AT&T network and the 100 markets talked about when people refer to 3G network rollouts," Shiv Bakhshi, an IDC analyst, told TechNewsWorld.
By the time the G1 launches on Oct 22, according to T-Mobile, 3G coverage will be available in 26 metropolitan areas. While T-Mobile is working to bring other locales into its 3G network, it will likely take many months or even years before it is available in most areas of the U.S.
Meanwhile, some iPhone users have complained about shoddy 3G service even in locations that are supposed to have full coverage. Those complaints, however, have quieted somewhat following a recent software update.
3G network coverage will allow G1 owners to view Web sites with many images or videos; watch YouTube and other video files; upload large files such as photos, videos or presentations; and download large files from an e-mail account or Web site. If a G1 user is in an area with no 3G reception, he or she must use the carrier's slower EDGE network.
For consumers who do not live in a covered area, the phone's WiFi support will come in handy.
"WiFi is faster than 3G," said Bakhshi. "It depends on how many other people are using that particular access point and a given point and time."
Data Plans
Another major consideration for both the iPhone and G1 are the respective data plans available from AT&T and T-Mobile.
When the iPhone made its initial bow on AT&T, the carrier offered plans that covered data, visual voicemail, 200 text messages, rollover minutes, and unlimited mobile-to-mobile calling starting at US$59.99.
With the release of the 3G iPhone, however, AT&T changed the iPhone rates. It now offers its data plans -- including data, visual voicemail, rollover minutes and mobile-to-mobile calling for a $30 premium over its voice plans. For example, an individual with a 450 minute plan (includes 5,000 night and weekends minutes) would pay a total of $69.99, plus applicable taxes and other charges. An AT&T FamilyTalk plan with 700 minutes that includes two lines will run $129.99.
Texting, no longer included in the data plan at all, will also add more to the bill. For individual plans, texting will cost an additional $5 per month for 200 messages and up to $20 for unlimited texting and $30 for FamilyTalk plans.
For the G1, T-Mobile seems to have taken a page from AT&T's original playbook. The carrier offers a data plan including 400 text message and data access for $25 a month on top of the price of a chosen voice plan. Unlimited texting will add on another $10.
For individuals, those plans range from the basic 300 minutes for $29.99 up to $99.99 for an unlimited plan. Family plans are available starting at 700 minutes for $59.99 up to an unlimited plan priced at $149.99.
For the G1, T-Mobile's least-expensive individual plan comes in at $64.99, not including taxes and other surcharges. That's $5 per month less than AT&T's most minimal iPhone plan. Add in texting on AT&T, and the difference in price jumps further.
"T-Mobile's pricing is somewhat more aggressive. People will look at the devices, initial costs and other aspects of the plan. There are different considerations for those who might switch vs. those who are already AT&T or T-Mobile subscribers. MyFaves is a potential tie breaker for some. But the iPhone overall is a more elegant device than the G1," Greg Sterling, principal analyst at Sterling Market Intelligence, told TechNewsWorld.
That said, T-Mobile, has also built a 1 GB bandwidth cap per month on its 3G network into the G1 contract. Users that exceed that amount in any given monthly cycle could see their access reduced to 50 kilobits per second, the company warned.
"That's not a bad thing to do because 1 GB is a hell of a lot of bandwidth to offer someone," Bakhshi noted.
Open or Closed?
Both the iPhone and the G1 offer users the ability to download applications onto the device. For iPhone owners, this is done through Apple's App Store, a closely controlled e-tail marketplace for applications created by third-party and independent software developers and approved by Apple.
Apple's control over the App Store has come under fire for its approval process, which some developers and users say is arbitrary and too opaque.
Google has taken the opposite approach to its Android Marketplace, in part because the platform's basic software is open source rather than proprietary. The platform's openness will enable developers to modify Android, improving the platform as they do so, according to Andy Rubin, senior director for mobile platforms at Google.
It's an approach that some developers will prefer to Apple's controlled channel. For consumers, however, it does mean there will be less quality control, Sterling said.
"Apple is strictly controlling access to the App Store, while Google is going to let the market and user community separate the wheat from the chaff," he explained.
Open platforms leverage the world's innovation, according to Bakhshi, but interoperability and coordination are also necessary.
"It is an open question, what an open platform will do. We'll have to wait and see what the impact of this openness means. You can overrate openness, because at the end of the day, you need coordination," he added.
Other Considerations
There are other factors that could also make a difference for consumers. For example, although the G1 includes a music player, it does not offer a standard 3.5mm headphone jack. In order to listen through standard headphones, users will have to buy an adapter. The iPhone 3G has a standard jack.
Finally, the iPhone and the G1 take different approaches to storage. Apple offers both an 8 GB and a 16 GB iPhone. The G1, on the other hand, comes pre-installed with a 1 GB MicroSD memory card. Users can buy additional memory cards (the device supports cards up to 8 GB) and interchange them, a feature not offered on the iPhone.
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