Google’s $199 phone will give a strong competition to Apple iPhone.  The mobile will be on display to analysts and reporters on Tuesday in Manhattan. Google’s Android mobile software is expected to hit stores later this fall. Features of the Android operating system were shown by Google on an unidentified black HTC handset at a developer’s conference in London on Wednesday.

The Google phone is developed by a Taiwanese company HTC and features a touch screen like the iPhone. Stiff competition is expected between Google $199 and IPhone.

Apple iPhone 3G has already generated significant interest among consumers for redefining touch-screen technology. The company has also popularized mobile applications and made significant improvements Web navigation on cell phones.

This is the first phone of many in the pipeline by Google. According to Google, its ultimate goal is - driving mobile Internet use and, in turn, ads. For this, it will need to develop and present multiple devices in the hands of mainstream consumers. It will also have to keep the price factor into account as companies like Palm and Samsung already offer entry-level smartphones for $100.