Neonode takes aim at iPhone

Stockholm-based handset developer, Neonode, which stole the show at 3GSM with its breathtaking touchscreen-powered UI, has had a busy week meeting with top carriers in the U.S. and incumbent handset makers. Neonode's board member Julie Mayer, whose husband is John Mayer, ex-CTO of Motorola, has certainly helped the startup get face-time with the bigger players, but the company's technology speaks for itself.

Neonode's new CEO, Mikael Hagman, former CEO of Sony Finland and Sweden, demonstrated the company's UI, which is based on Windows CE. He explained its optical-touchscreen technology, which overlays an infrared grid over the face of the phone's LCD screen. The intuitive controls make use of gestures like sweeping left or right to maneuver through the phone's screens stylus-free. The demonstration conjures allusions to an as yet higher profile handset recently debuted at MacWorld, but such references only prove the market is ripe and carriers not named AT&T are hungry for a device to rival the $400 million hype machine behind the iPhone.

Neonode's most recent news is an impending merger with shell company SBE, which will make Neonode a public company. The company expects that process to accelerate this summer as the SEC reviews the merger.

The company, founded in 2001, began selling an early version of its handset, called the N1 in 2004 direct-to-consumers from its website. The 12,000 limited edition run was an R&D effort that resulted in plenty of user feedback, resulting in the current version on the N2. The UI makes use of a sweeping motion from different areas on the handset's screen. Neonode points to the iPhone's sweep to the right gesture to unlock their phone, which Neonode claims was on their 2004 D2C version of N1. Neonode said a few of their early handsets were known to be floating around Cupertino pre-iPhone. So who's hunting who? Inevitably, Neonode will be known as an iPhone-killer, but whether they can get a carriage deal by June is still unclear. -Brian

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