Apple's iPhone caused a sensation in the US market when it was introduced earlier this year - selling more than one million units in the first three months on the market. With the product poised for introduction into European markets this month and Asia expected to follow suit early next year, rivals have seen the writing on the wall and are investing heavily to overhaul their handset designs and make the user interface more intuitive.
Most analysts say the iPhone has given the industry a much needed kick in the pants and forced handset makers to rethink how their phones are used and radically speed up their interface development schedules.
Stuart Carlaw, wireless research director at ABI Research, says the iPhone could do for the consumer smartphone market what Motorola's RAZR did for mobile design. 'The iPhone is not cutting-edge telecommunications, but where it is radical - in its user-interface and functionality - it will certainly change forever the way handset manufacturers think about their design philosophies,' starting with touch-screen and sensor tech (accelerometers) that can tell which way you're holding it.
Several handset vendors have already started producing user interfaces that are similar to the iPhone.
'It looks as if a new device segment will emerge with the iPhone heading the charge,' says Martin Garner, analyst with Ovum. 'But how big is this segment and how competitive will the other vendors be‾' That remains to be seen.
While there are plenty of competing multimedia smartphones with entrenched and loyal customer bases, the leap forward in usability of the iPhone leaves even the strongest competitors vulnerable as Apple rolls out the model worldwide. This explains the flurry of announcements by competing makers of smartphones, such as Samsung, LG, Sony Ericsson, Motorola and even Microsoft.
The focus has turned, unsurprisingly, toward touch screens and sleek designs and away from adding all kinds of bells and whistles.
This month Samsung is launching a multimedia touch-screen mobile phone in Europe, codenamed F700. It has full touch-screen control but unlike the iPhone, it has a QWERTY keypad hidden underneath it. The model will go on sale in Germany, Britain and France this month, and in Southeast Asia and North America early next year. The handset drew widespread attention last month when its new screen interface called Croix received the iF Communication Design Award.
Another iPhone alternative is LG Electronics' Voyager, which features a large touch screen, a camera and extensive multimedia, web browsing and email capabilities. It distinguishes itself from the iPhone by folding open lengthwise to reveal a QWERTY keyboard and a second, non-touch sensitive screen. The lack of a hardware keyboard has been one of the main complaints about the iPhone.
The Voyager, however, will not come with a large built-in memory for songs and video, but has a slot for memory cards up to 8 Gb. It also has a smaller screen than the iPhone's. In the US the Voyager has direct access to Verizon Wireless' online music store. LG made its first move to a touch screen with the release of its of its high-end Prada phone early in the year.
Also vying for market share in this segment is the HTC Touch, a touchscreen device from Taiwan's High-Tech Computer Corp. The Touch is HTC's fifth-generation phone and is currently being sold in Britain (but not the US yet) for about $665.