Opinion – We had almost given up hope that any of the five largest cellphone makers would be able to come up with a true iPhone rival that could match its appeal and functionality. But Nokia’s 5800 came virtually out of nowhere and seems to have all the right ingredients to challenge Apple. From what we have seen so far, this is one fantastic, cool device with very few compromises. It looks great and beats the iPhone effortlessly in audio and video features. It comes with a full year of free, unlimited access to songs on the Nokia Music Store service. It is expected to be available as an unlocked phone that will cost about 25% less than the iPhone. No doubt about it: This one looks serious. Apple should be worried.

A brief glance at the Nokia 5800 XpressMusic unveiled earlier today must have sent shivers down Apple executives' spines. Not for what the handset is, but because it shows that cellphone have woken up and demonstrate that they can adapt to competitive challenges and won’t give up market share that easily.

The 5800 successfully challenges the iPhone in terms of design, coolness and shiny software, but it beats Apple's handset down in terms of music and video. What is somewhat surprising is that despite the fact that Nokia has taken clues from what has made the iPhone so successful, 5800 isn't a copy-cat: It includes some of the iPhone’s strongest features (such as a large touchscreen) and fixes some of its faults and combines everything in one stylish package. We are pretty sure that the 5800 will turn just as many heads as the iPhone did when it was new. Check out our gallery and see what we mean.

There is also decent hardware to back up its looks. Not only does it come with a proximity sensor and an accelerometer (both included in the iPhone as well), but it outclasses Apple's device in audio and video. The 5800 is equipped with a 3.2 megapixel camera with a high-quality lens optics and a dual-LED flash for low-light conditions. Its music player matches the iPhone, minus "iPod" nametag. It "Comes with Music", a new service that lets you wirelessly download or stream songs from the Nokia Music Store service for free during first year.

The Nokia phone also records VGA quality video at 30 FPS, which should look great on its screen, which has twice as many pixels as the iPhone screen. Another feature that exploits an iPhone weakness: It has a replaceable battery and does MMS. It also knows software tricks. For instance, you can place four contacts on the home screen for quick access to their entire history, including phone logs, recent SMS messages, even photos and blog updates. You can easily bring up menu bar anytime for quick access to music, favorite tracks, videos, photos and web.

So, is this the phone that will kill the iPhone, right?

No. The 5800 is actually more a preview of things to come from Nokia. Both the 5800 and iPhone demonstrate two distinct philosophies in the mobile phone space - showbiz and the more conservative approach of a traditional cellphone company. Apple still trumps any other device cards on hardware integration and design, simplicity, gorgeous graphics and a unique UI that is spiced up with support for pinch zooming, content flicks and finger scrolling.

But it is clear that Nokia is going after Apple – interestingly with a strategy we know from Apple: Take the best from your rivals and fix their mistakes. We strongly believe that Steve Jobs and his team should be worried. In fact, they need to come up with the next and much improved iPhone really soon. Nokia’s 5800 is a clear sign that cellphone makers won’t allow Apple to duplicate its success with the iPod in the cellphone market. In fact, we believe that the iPhone and its features suddenly look somewhat dated – when compared to the new Nokia phone.  

When the 5800 hits the market, Apple will still have advantages through its AppStore, user interface and applications such as Mobile Me. But if Apple decides to rest on its laurels, it is clear that the iPhone will be in serious trouble sooner or later.

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