This represents another iron in the fire for the laptop maker, and no doubt will fan the flames of the recent hype regarding Android on netbooks, a natural fit for a player of Dells size and a game changer for the whole industry. However, analysts warn Dell may not have an easy ride, no matter how much margins are squeezed via the use of, for example, the free Android OS. In a fiercly competitive market even old hands are struggling, and this year Motorola has been trumpeting the fact that their entire smartphone range will run on Android.

Dell will need a significant differentiator to avoid being more than a mere curiosity. Attractive carrier deals could be the way forward. So far T-Mobile have enjoyed the exclusivity of the Android market but how long that will last depends on these new handset models from alternate manufacturers.

One ace Dell may have up its sleeve is the famous direct model it pioneered for its PC, server and laptop end-user sales channel. Cutting out the middleman has certainly worked well for them in the past, but the mobile space is a whole new ball game. How far, if at all, the carriers will go should they adopt a similar approach is difficult to predict - if indeed they will at all.