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Last Updated: Wednesday January 06 2010 15:40 GMT

Google launches its own phone

The launch of Google's new phone

The company behind the most famous search engine on the internet, Google, has created a mobile phone.

The phone, called the Nexus One, was shown off on Tuesday in America and like the iPhone and Palm Pre, uses a touch screen to control it.

The phone has been built by another company, but uses computer programmes created by Google to make it work.

The Nexus One will work on any phone network, although it will cost a lot of money to buy the handset on its own.

If customers get the phone from a phone company it will cost them less money straight away, but they will have to sign up for a contract that will last more than a year.

Google's Nexus One phone

To buy the phone direct from Google - without a phone contract - will cost more than £300.

Technology experts say that the Nexus One is very similar to Apple's iPhone, but may be a little bit more powerful in terms of technology.

So why is Google making a mobile phone?

The company makes its money from selling advertising online. As more and more people are using smartphones to use the internet Google wants to make sure those people are still seeing the adverts it sells.