It’s a situation that has many observers thinking back to the 1980s, when IBM introduced its PC and eclipsed Apple in market share by betting on open platforms. In the end, Apple was left with a respectable business, but a single-digit morsel of the PC market share. (The Mac has since crept up to 9.4 percent, according to IDC.)

How could Google draft more customers into the Android army and diminish the iPhone’s market share? Focus on the iPhone’s weaknesses, of course. The iPhone’s lack of background-processing capability (i.e., the ability to run multiple third-party apps at once) could push multitasking professionals toward Android. And the notoriety of iPhone’s exclusive carrier in the United States, AT&T, could compel consumers to embrace Android phones carried by Verizon, which has a bigger network and a better reputation for service.

Then there’s the App Store. Despite harboring upward of 90,000 apps, and letting a few developers earn hundreds of thousands of dollars, the Apple’s App Store approval process has been roundly criticized for being opaque. Apple has rejected some apps submitted by third-party developers for unclear reasons. Programmers complain it’s difficult or impossible to communicate with the secretive Cupertino, California, company.

Did we mention the App Store is overcrowded? In a way, that’s a plus for consumers: the more choices, the better. But it can be a headache for third-party programmers, who have difficulty getting exposure for their apps in an increasingly cluttered space. The flaws of the App Store could drive away the people who create the element that makes the iPhone so appealing — its wealth of apps furthering the capabilities of the handset.

There’s a lot at stake. Research firm Gartner this week stated that worldwide smartphone shipments would grow 29 percent year over year to 180 million units, exceeding notebook shipments. That would suggest smartphones are shaping up to become the next major computing platform — and the companies who control the dominant platforms stand to gain billions in revenue.

Still, most analysts and developers polled by Wired.com aren’t too worried about Apple’s prospects in the smartphone space.

“This is not going to be a space with two giants,” said Raven Zachary, a technology analyst and owner of iPhone app-development house Small Society. “It’s going to be a healthy competitive environment for some time to come.”

Relatively young, the mobile platform ecosystem is a new kind of beast in the technology world. Unlike the PC industry — where Microsoft conquered the operating system market, claiming roughly 90 percent market share to date — the mobile space has multiple companies fighting for their fair share of the pie. Some of those players include Research In Motion, Palm, Symbian and Microsoft.

With an early start, Microsoft did have a chance to dominate the mobile landscape. The software titan launched its first mobile OS back in 1996: Windows CE, which served as the foundation for the Windows Mobile OS shipping with some smartphones today. However, in terms of market share, Windows Mobile has been in steady decline. In 2008, its market share dropped to 14 percent — down from 23 percent in 2004.

With 49 percent market share, Symbian is currently the dominant force in the smartphone platform space, according to Gartner. Gartner predicts Symbian will retain its dominance, and the firm is especially optimistic about Android: Gartner predicts Android will leap to 18 percent market share (up from 1.6 percent to date). Meanwhile, the firm has a less optimistic outlook for Apple: 2.9 percent growth by 2012, giving the company 13.6 percent market share.

These numbers lead Joe Wilcox of BetaNews to declare that “iPhone cannot win the smartphone wars,” in an article that has sparked much debate in the tech community this week. He argues that Android, which is expanding onto other mobiles devices in addition to smartphones (such as Barnes and Noble’s “Nook” e-book reader) is poised to conquer this space.

“Another ‘everyone else against Apple battle’ is coming, with Android looking to be the better OS around which an ecosystem grows and thrives,” Wilcox wrote. “There’s a Star Wars metaphor here somewhere. Apple lost out to DOS/Windows because of the attack of the PC clones. Now the droids are coming for iPhone.”

Tero Kuittinen, an MKM Partners telecom analyst, disagrees, and he isn’t as optimistic about Android because of its bumpy start.

“The key point about Android is the first few models haven’t really been doing great,” Kuittinen said in a phone interview. “Based on that there’s no real evidence that the demand of Android phones is rampant.”

Kuittinen noted that European customers already seem “cautious” about Android because of the sluggish, buggy experience of the earliest Google phones.

Other than technical issues, Google has many areas to address before posing a serious threat, such as offering a compelling music substitute for Android smartphones to battle iTunes, Kuittinen said. Google is just getting started with a music solution: The search giant on Wednesday launched a new music-search feature, which automatically searches for playable music tracks.

Andreas Schobel, co-founder of Snaptic, which develops apps for both Android and the iPhone, said the Android OS has a lot of catching up to do in terms of user interface.

“The UI still sucks; it’s just not being able to pinch, not being able to use gestures, that makes it rough,” Schobel said. “It’s getting better, but it’s still not there yet.”

However, Schobel foresees a division occurring between consumers who opt for Android and those who stick with an iPhone. He noted that Android stands a chance to win over productivity-focused users due to its ability to handle multiple apps simultaneously, which the iPhone cannot do. He added that Android’s open API enables developers to easily create “mash-up” apps that can seamlessly integrate social networking services such as Facebook and Twitter into any app.

Though Android might become a popular platform for productivity, the iPhone will still be the primary handset for gaming, Schobel predicted. Game developers are more attracted to coding a game for the iPhone, because they’re programming a game to work with a specific piece of hardware and take full advantage of its graphic chip — an effort that would not be easy with an open platform like Android, an OS designed for multiple phones using different types of hardware.

In any case, Schobel said Android is gaining momentum fast, and Apple must continue to innovate in order to stay ahead of the smartphone OS curve.

“People on Android are going to be pushing forward in such a feverish pace, and Apple is going to have to start doing stuff really soon,” Schobel said.

Just what determines who “wins” a smartphone platform war? That’s subjective. Wilcox bases his argument purely on market-share numbers; whoever gets the biggest slice of the pie wins by his definition.

But Zachary said the iPhone is still a winner at its current size, and he’d be happy if it one day grew to grab 25 percent of the mobile-platform market share — not a dominating number.

In a space that’s crowded with several players, a definitive loss would be the complete failure and disappearance of a company. Zachary and Schobel are both betting Palm will be the first to go. Palm’s WebOS runs on the Palm Pre, and the company currently possesses 0 percent market share, according to Gartner, who predicts WebOS’ market share will only grow 1.4 percent in the next three years.

The company’s smartphone market share continues to shrink, and Zachary said he previously thought Palm would eventually be acquired by a larger company, such as Samsung, to develop mobile operating systems in-house. However, because Google hands out Android as a free, open source OS, this decreases the value of Palm as an acquisition target.

“Who I’m really scared for is Palm,” Schobel said. “They’re dead.”

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Rockstar Games has announced that it will be releasing its first two games for the iPhone and iPod touch this fall, including the platform’s first Grand Theft Auto title. Beaterator is a portable music-making application that allows people of all musical backgrounds and ability to create beats and songs, featuring thousands of loops and sounds made by both well-known producer/rapper Timbaland and Rockstar. Currently available for the Nintendo DS, Grand Theft Auto: Chinatown Wars follows the story of Huang Lee, a young Triad who travels to Liberty City after the mysterious death of his father to uncover the truth behind his demise. Both games are listed as coming this fall; more exact release or pricing information has yet to be announced.

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The software means the phone can send instructions to a set of high-tech taps on a bath tub that can control the temperature, pressure and draining of the water Photo: NEWS INTERNATIONA

Unique Automation, the London-based company behind the device, showed off its wares at a trade show this week. A spokesman said: “At the touch of a button, Bath-o-matic fills the bath to perfection – even adding bubbles and perfumes.

“Bringing full automation to the bathroom at last, this technological breakthrough offers energy and water savings plus flooding and scalding prevention.”

Sharon Munday, a 27 year-old secretary, viewed the Bath-o-matic demonstration at the CEDIA Expo 2009 at the ExCeL centre in London. “It really shows off just how the iPhone is becoming the ultimate remote control for everything in the home,” she said.

“If I had £4,000 spare I’d get one. It would be perfect for me as I have a 20 minute drive home from the office and could set it to run as I leave and hop in as soon as I got home. That would be absolute bliss.”

A shower version of the software is coming soon.

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It’s become a familiar pattern, as we saw most recently with an 18k gold Shuffle that was soon followed by a diamond encrusted version. So it was time to start an office pool after a 24k iPhone began making the rounds a few weeks ago.

In classically over-the-top fashion, the U.K. purveyor has adorned this limited edition with 420 diamonds totaling 5.65 carats set in 18k white or yellow gold, with a choice of white, black or pink sapphires. Decisions, decisions! With a price tag of $41,225 price, it laughs in the face of the credit crunch.

Designed by Austrian jeweller Peter Aloisson the customised iPhone is priced at £1.6 million. The handset is surrounded by a white gold line encrusted with a total of 138 brilliant cut diamonds of the best quality.

But the most prominent feature of the “Kings button” phone is its home button that features a rare 6.6 carat diamond.

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