T-Mobile and Taiwanese cell phone manufacturer HTC launched the latest smartphone – the G1 “Dream.” The handset is marketed by the Bonn, Germany-based company and is the first cell phone that runs on Google's Android operating system.

The G1 has a 3.2-inch touch display and when flipped out it exposes a full keyboard and trackball navigation. The device offers many of the application developed by Google such as Gmail and support for YouTube.

However, G1 (previously codenamed the HTC “Dream”) doesn’t offer built-in Microsoft Exchange support, which is bad news for clients in the business segment of the smartphone market. This “flaw” was acknowledged by T-Mobile officials.

"We expect it to be more for the consumer, not necessarily for enterprises," said Cole Brodman, chief technology and innovation officer at T-Mobile USA.

The G1 won’t win any beauty contests. Apple’s iPhone 3G is far slicker and has way more sex appeal. But when it comes to software and advanced Web browsing “the Dream” seems better and will surely give its rivals in the samrtphone industry a run for their money.

Despite its not so sexy design, the G1 Dream is a great improvement when it comes to mobile Web experience for users. Only the iPhone 3G seems to be able to keep up with the G1, while other smartphones such as the BlackBerry or the cell phones compatible with Microsoft Windows Mobile OS were left behind.

The 4.6-by-2.1-by-0.6-inch smartphone will hit the shelves in the US on Oct. 22 and will be available for purchase at the price of $179 with a two-year service contract with T-Mobile. G1 will then go on sale in the United Kingdom in November via Deutsche Telecom, the parent company of T-Mobile. The rest of Europe will see the G1 Dream in T-Mobile stores in the first quarter of 2009.