The new T-Mobile G1 wireless phone, announced Tuesday by T-Mobile USA, Google and HTC, generated attention for its use of the open Android platform, but it will be locked to the T-Mobile USA network and it doesn't appear to be heavily focused on business users.

"It appears they have provided an Android phone that is only half open," said Jack Gold, an analyst at J. Gold Associates.

Moreover, the absence of support for Microsoft Exchange e-mail or another robust business-focused e-mail system will limit the G1's usefulness to all but the smallest businesses, Gold added. "You can't use Gmail in the enterprise."

Even T-Mobile conceded the device will be more focused on consumers. "This device will have mass appeal and something for everybody," said Cole Brodman, chief technology and innovation officer at T-Mobile USA in a webcast announcement of the US$179 device. Still he quickly added: "We expect it to be more [for the] consumer, not necessarily enterprise, but a lot of enterprise workers will come ... and use it as well."

Brodman defended the locking of the device to T-Mobile's GSM and 3G HSPA networks, noting that a faster 3G network will give G1 applications the "best experience." The phone will function on 2G networks, he said, adding there will be a "good experience on 2G, but the best on Wi-Fi and 3G."

About 16 cities have HSPA service from T-Mobile Tuesday, and 22 cities will be on that 3G network by the time of the US launch of the G1 on October 22. About 27 markets will have HSPA service in mid-November, representing 80 per cent of T-Mobile USA's 31 million customers, Brodman said.

The bigger market advantage will be in Europe, where 100 million T-Mobile International customers will have the phone in the first quarter of next year, starting with users in the UK in early November, said Christopher Schlaffer, innovation officer at Deutsche Telekom, which owns T-Mobile.

Inevitably, users will compare the G1 to Apple's iPhone 3G, which garnered more credibility among business users than its predecessor thanks to new features such as a robust e-mail connection with Microsoft Exchange. But Google's senior director of mobile platforms, Andy Rubin, said that while the G1 will allow users to read Microsoft Word documents and PDFs, it won't support for Exchange.

"It's a good opportunity for third parties" to provide an Exchange application, he noted, adding that the G1 supports Gmail from Google. "Gmail is pretty robust, and you can search e-mail pretty fast with it."

Brodman also said that the G1 does not yet support Skype and will not support iTunes, although it supports the iTunes code and could support it if Apple unlocked the digital rights.

Gold's research includes a recent survey of 290 businesses in North America, which showed that T-Mobile has been a small player with business users, with about 8 percent those surveyed reporting that they use the carrier. AT&T leads that group, following by Verizon Wireless and Sprint Nextel, Gold said.