More than 30 percent of all American adults use a smart phone. Until now, Apple's iPhone has dominated the market.
However, on Tuesday Google unveiled its own smart phone called the Nexus One, which could start a massive phone war.
Google's operating system has been on phones before, but this is the first time the Internet giant or any Internet company has sold a phone directly.
"The Nexus One belongs in an emerging category of device we call super phones," said Mario Queiroz, vice president of product management for Google.
"Google getting into the mobile phone space is a big deal," Gizmodo's John Herrman said.
Experts say Google wants to stay ahead of the curve. They point to computer maker IBM getting left in the dust during the software boom, and Microsoft playing catch up with the Internet.
So how does the Google Nexus One stack up against the iPhone? Google's smart phone has more computing power. It also has a higher resolution camera with an LED flash. But for gamers, the Nexus One touch screen is not as responsive - and that's a win for the iPhone.
Some say the ultimate battle ground is the content for these devices. Although Google's marketplace for music, video and applications is growing fast, right now, it's not as impressive as Apple's.
But as the mobile landscape grows, the consumer may end up the biggest winner.