This has to be salt in the wounds of Microsoft, who has had suffered several missteps and has seen the mythical Windows Mobile 7 get dealayed over 2 years. Windows Mobile 6.5 launched earlier this month to little fan fair. People are not considering Windows Mobile 6.5 a real competitor to the iPhone. Microsoft is not really in the converation now and Google has to be celebrating. Motorola’s Droid is certainly going head to head with the iPhone.

Palm packed a lot in this device and seemed to really exploit the flaws of the iPhone. Namely, the Palm Pre includes a removable battery, QWERTY keyboard, and it even has a copy paste feature. It also shows off a lot of innovation around gesturing and the way the UI is built. What is is remarkable about all of this is Palm was on the verge of going out of business and in less than a year came out with a device to rival the iPhone. It looks like Palm finally got its mojo back. And if Palm can get these devices to market quickly, word on the street is some time in February, then they could become a major player again in the mobile industry.

Early in December photos leaked on the OPhone and it was rumored to be built on Google’s Android platform. This would be a big step up from Google’s G1 device in many ways. Lenovo and China Mobile could have a legitimate iPhone killer on their hands. Time will tell but if this is build on Android, Google is quickly closing the gap on Apple.

But the most interesting thing is how these types of devices are blurring the lines for multimedia experiences. With a 8MP camera on board it becomes a compelling multi purpose device. Now I only need to bring one device out with me.

The Samsung Pixon offers a compelling replacement to my point and shoot camera. I can now take high quality photos that are not just good enough to post on Facebook but can be printed and shared with family and friends.

What is interesting about this move is Microsoft is making Seadragon Mobile available on Apple’s iPhone even before you can get it on the Windows Mobile platform. Is this a change of heart for Microsoft? Probably not. Seadragon Mobile uses graphics accelerated hardware and there are not many devices on the market today that take advantage of those capabilities. Microsoft is probably using this as an opportunity to test some technology early and also doing a little bit of hedging.

Nokia who owns over 40% of the phone market should start getting a little worried. They sold over 430M units last year and their bread and butter segment was at price point below $100 for low end feature phones. This move by Apple can be a real game changer if it proves to be true.

Now 10K apps later the #1 “paid” app on iTunes is Koi Pond. This is a joke. Gizmodo gives an entire breakdown of the apps by category. The iPhone app marketplace has really blossomed into a freeware marketplace. The only really successful apps that will be high volume will be free. There is no money in building small little consumer apps.

The only reason Apple got 10K people to build apps was the hope it would lead to getting users. iPhone will create a concentrated set of users using a common platform. But similar to Facebook apps no one really looks at Facebook as a real application platform. It’s just a way to get access to a 120 million people that are all socially connected. And the only reason established companies will build apps is to stay relevant to iPhone users.

Developers are also constrained by Apple’s closed system approach. Similar to Chinese capitalism it looks and smells like a open marketplace but its not really open. I can’t wait until 2009 where Pong will be the #1 “paid” iPhone app.

Nokia seems to have created a lot of buzz or has really bad infrastructure. When I went back to the teaser site it crashed and gave me a server error. Nokia seems to have fixed the problem. The site now just redirects you to the Nokia World Web site where the keynote is being webcasted.