The wait is over.

After weeks of speculation, web giant Google announced on Monday that it was developing a free software package for cell phones that would give it a new platform on which to sell ads and services (See "Google's Call").

Shares of Google (nasdaq: GOOG - news - people ) rose $7.58, or 1.1%, to $718.83 in afternoon trading.

Investors, analysts, and other observers have been giving their two cents on what kind of relationship the Mountain View-based Google wants to have with the cell phone.

This is not Google’s answer to Apple's (nasdaq: AAPL - news - people ) widely-known iPhone, since Google won't be making the devices. (See "Will Google Crush the iPhone?")

Instead, the company will work with four cell phone manufacturers who have agreed to use Google’s programs on their handsets. So far, Motorola (nyse: MOT - news - people ), Samsung Electronics, HTC and LG Electronics have agreed to use Google's software in some of their phones. Both Motorola and Samsung already have Microsoft's Windows Mobile on some of their phones.

That means the announcements aren't really aimed at consumers but at the worker bees of the technology business: developers who will build the stuff that eventually consumers may buy.

Consumers will have to buy a new phone to get the Google software because the bundle won't work with most existing handsets. Indeed the first phones equipped with Google's so-called "software stack," won't be available until the second half of 2008.

Engineers have been working on the software for three years, dating back to a Silicon Valley start-up called Android that Google acquired in 2005. The mobile software still bears the Android name in acknowledgment of its heritage.

"This is going to bring the Internet into cell phones in a very cool way," promised Andy Rubin, an Android co-founder who is now Google's director of mobile platforms.

Monday’s announcement is just another step in Google’s determined march to put its mark on two of the biggest trends in information technology: the rapidly changing world of wireless communication and "social networking." (See “Google’s Growing Grasp” and "Take That, Facebook!").

Even with its market debut months away, Google's software looms as a significant threat to other mobile operating systems made by Microsoft (nasdaq: MSFT - news - people ), Research In Motion (nasdaq: RIMM - news - people ), Palm (nasdaq: PALM - news - people ) and Symbian, which is owned by Nokia (nyse: NOK - news - people ).

Because Google's software will be free, it could undercut rivals who charge handset makers to install their operating systems. It also promises to make smart phones less expensive, since manufacturers won't have to pay for the software.

Google's system will be based on computer code that can be openly distributed among programmers. Google hopes this will encourage developers to create new applications and other software improvements that could spawn new uses for smart phones.

"This is a shot that is going to be heard around the world, but it's just the first shot in what is going to be a very protracted battle in the next frontier of the mobile Web," said Michael Gartenberg, a Jupiter Research vice president.

The list of wireless carriers that have agreed to provide service for phones with Google software in the United States include Sprint Nextel (nyse: S - news - people ) and Deutsche Telekom's (nyse: DT - news - people ) T-Mobile in the United States. China Mobile (nyse: CHL - news - people ), Telefonica (nyse: TEF - news - people ) in Spain and Telecom Italia are among the carriers that have signed on to provide service outside the United States.

Those are among the 34 companies that have secretly organized over the past year into a group it calls the "Open Handset Alliance."

Once an alliance member has made the first phone available to the public, the intellectual property at the heart of the alliance will be openly available to any other company developing mobile technology.