Wildfire has an app sharing device and the handset is expected to be free in the UK on monthly contracts priced at about £20

The battle between Apple and Google for the lion's share of the smartphone market is due to heat up with the arrival of a new phone aimed squarely at taking the online search engine group's Android mobile platform to the mass market.

The arrival of the HTC Wildfire, in the UK in July, will also come hard on the heels of a new version of the iPhone in San Francisco. Leaked reports of the 'iPhone 4G' on the internet suggest it is designed for the 'high-end' of the smartphone market.

Certainly, Apple's share of the mobile phone market will be eroded as more and more devices are launched that use Google's platform. Apple must decide whether it wants to remain a trend setting niche player - though admittedly a highly profitable one - as it has in the home computing world, or grab a greater slice of the market by producing a wider range of devices, as it has with personal digital music players.

Despite a shaky start when the first device, the G1, went on sale more than a year after Apple's iPhone had launched, Android has gained real traction in the last few months in its battle with Apple. In the first quarter of the year, phones with Android outsold Apple's iPhone in the US for the first time, according to market research by the NPD Group. The market for phones that can send emails, access the web and download applications is still dominated by the BlackBerry, made by Canada's Research In Motion and a brand which last year celebrated its 10th birthday. But Android is closing the gap. In the UK, almost one in every five smartphones sold now uses Android, according to retail experts GfK.

Google is expected to unveil the latest version of Android at a two-day developer event in California starting on Wednesday. Previous iterations of Android have been named after pastries - such as donut, cupcake and the latest version 2.1 eclair - but it has now switched to other foodstuffs: the new 2.2 version is called 'froyo', or frozen yoghurt.

The rise of Android has been helped by the recent release of the HTC Desire, which has been favourably compared with the iPhone and lauded by critics as better than Google's own-branded Nexus One device. Android devices have been aimed at the same, expensive, segment of the smartphone market as the iPhone, but the HTC Wildfire, in contrast, is expected to be free in the UK on monthly contracts priced at about £20, making it available to a much wider audience.

The Wildfire, with a 3.2 inch touchscreen, is smaller than the Nexus One and Desire, which have 3.7 inch screens, but has the same 5 megapixel camera. Its processor is slower than the Desire and Nexus One which include Qualcomm's Snapdragon chip.

HTC, which is currently embroiled in a bitter patent dispute with Apple, has placed its HTC Sense user interface on the Wildfire, but with some additions. The phone aggregates all the different ways in which a person can communicate and pulls them into one place - rather like Vodafone's 360 service. So Wildfire users can see all their interactions - from text and email, to Facebook and Twitter updates - through that individual's contact card in the phone's address book.

The HTC Wildfire also allows users to recommend applications - or 'apps' - that they have downloaded onto their device, to their friends, either by sending them a text or email with a link to the 'app' on the Android marketplace, or by broadcasting details of the 'app' on Twitter and Facebook.

Drew Bamford, HTC's director of user experience, said it is just the first step in making Google's Android marketplace, which includes many thousands of downloadable programmes, easier for people to navigate.

"This is our first foray into 'app' sharing so it is pretty straightforward at the moment - it makes it easy to recommend apps to friends. I think in the future you will see more sophisticated tools for tracking this kind of stuff."

While Apple has a stranglehold over the iPhone's 'app' store and RIM keeps a tight rein on its equivalent for Blackberry users, Google exerts very little control over the Android Marketplace. As a result, consumers are effectively left to navigate the store themselves, relying upon comments from other users to gauge whether a particular 'app' is useful or not. That may be fine for gadget fans and other early adopters, but the lack of control over the store is likely to leave many consumers confused.

The app explosion, caused by the iPhone, has caused a dramatic increase in traffic for the mobile phone networks but no corresponding increase in revenues. As a result, many of the networks are looking at ways of getting a slice of the action and because it is an open platform, Google's Marketplace offers them the potential for aligning themselves more closely with customers by helping them pick the best 'apps'. So with its app sharing widget, HTC is making a fast early grab for what could be the next battleground between handset manufacturers and mobile phone operators in the fight for the hearts and minds of consumers.