Along time partner with Microsoft HTC insiders claim that the new Google mobile phone software is "significantly" better than the Windows Mobile offering from Microsoft. During a recent visit to Australia HTC Chief Information Officer and head of research Horace Luke said that the Company was "impressed" with the new Google offering and he was confident that the HTC phone running the Google mobile software would be key competitor to the new 3G iPhone.

Telstra have refused to comment however ChanelNews has confirmed that the Carrier has been shown and is in possession of a HTC handset running the new Google Android software.

The new HTC Google phone will  come with a three-megapixel camera, a full HTML Web browser, access to all the standard Google services (such as Gmail, Search, Maps, Gtalk, and the like), and a music player. Unlike the Telstra 3G iPhone offering the new Telstra HTC Google phone will include an exclusive suite of Telstra applications for access to BigPond music, Foxtel and other exclusive Telstra services.

It will also have a a touch screen, like the iPhone. The screen will also slide out to expose a full five-row keyboard.

According to the New York Times the Apple iPhone has shaken the cellphone industry, partly because of its design, but mostly because carriers like Telstra, Optus, Vodaphone and Apple have allowed owners to download any number of applications to their phones.

Phones using Google's software will do the same thing. Google is making the Android operating system software available free to an alliance of companies, including mobile phone carriers and manufacturers who have agreed to provide devices which, like personal computers, allow users to decide which applications run on them.

Google thinks that many consumers will want to personalize their mobile phones with unique applications and services, including those made by Google.