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Dell Enters U.S. Smartphone Market

Dell has unveiled its first-ever U.S. smartphone, but the Aero faces stiff competition in a market dominated by Apple and RIM.

ROUND ROCK, Texas (

TheStreet

) --

Dell

TST Recommends

(DELL) - Get Report

has unveiled its first-ever U.S. smartphone, the Aero, which faces stiff competition from

Apple

(AAPL) - Get Report

and

Research In Motion

(RIMM)

.

With a 3.5-inch touchscreen and a 5-megapixel camera, the Android-powered Aero comes pretty late to the smartphone party. Apple has already sold more than 3 million of its new iPhone 4, and RIM recently unveiled its long-awaited

BlackBerry Torch.

Dell is also debuts late to the

Android market,

which is crowded with great-selling offerings from

HTC

and

Motorola

(MOT)

.

Dell is nonetheless hoping that its Aero device will tap into the growing popularity of the Android OS. Analyst firm the NPD Group recently reported that

Android outpaced RIM's BlackBerry OS

as the most popular U.S. smartphone operating system, thanks in no small part to Motorola.

NPD listed Motorola's Droid as the most popular Android phone, explaining that the

Google

(GOOG) - Get Report

operating system accounted for 33% of all smartphones purchased during the second quarter.

Dell, which touts the Aero as one of the lightest Android phones on the market, said that the device is available for $99.99 with a two-year

AT&T

(T) - Get Report

contract and $299.99 without.

The Aero also marks Dell's latest attempt to grow its product lineup. The computer maker, which recently launched its

Streak mini-tablet

in the U.S., is keen to extend its mobile device portfolio beyond laptops and netbooks.

Dell shares dipped 35 cents, or 2.93%, to $11.59 on Tuesday, outpacing the broader retreat in tech stocks that saw the Nasdaq fall 1.56%.

--Written by James Rogers in New York.

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