BBC NEWS - IPhone killer

The following day sees the release of the Palm Pre in the UK, a much-anticipated device which has been in development for seven years.

It debuts its own operating system - webOS - which aims to mimic desktop operating systems.

It allows users, for instance, to switch between applications in the same way as programs are multi-tasked on a home computer.

It has been touted as an "iPhone killer" since its release in the US in June.

Figures from market research firm TNS suggest the Pre-Palm launch could outshine the debut of the iPhone in 2007.

It surveyed 1,000 UK adults and found that 27% of existing O2 customers would be "keen to buy" the Palm Pre, compared with 17% wanting the iPhone prior to launch.

It will be available via 02, to anyone signing up for a two-year £34.26 monthly contract.

For those reluctant to sign up for lengthy contracts, smartphones are currently expensive.

To get a "pay and go" version of O2's iPhone 3G, for example, will cost a hefty £342.50.

According to Forrester the prepaid market in the UK accounts for around 65% of mobile users but data tariffs for users are not as attractive as those on contracts.

For anyone on a contract, mobile internet is bundled pretty much as standard these days.

If smartphones are to go truly mass market cheaper handsets and data charging tariffs that are attractive to the pre-paid market will be essential, said Mr Wood.

"£35 a month is a lot of money to some and we predict that smartphones will be available below £100 in 2010, alongside tariff innovation," he said.