There’s no getting away from comparisons to Apple’s iPhone 3G these days, so here it is: the HTC Touch Diamond was built as a follow-up to the HTC Touch, launched last year as a Windows Mobile-based competitor for the original iPhone.

The 3G Touch Diamond handset is a worthy iPhone 3G rival, with a touchscreen, Bluetooth, a 3.2-megapixel auto-focus camera, and four gigabytes of storage. It’s an elegant follow-up to the HTC Touch, and is Telus’ upcoming bid to steal iPhone business from Rogers. (Bell’s ringer is the Samsung Instinct.)

Telus is offering up the Touch Diamond for $449, or $349 with a two-year contract or $149 with a three-year plan. (The iPhone 3G, in contrast, comes in at $199 for the eight gigabyte model, and $299 for the 16 gigabyte model, but comes with a mandatory three-year contract ranging from $60 to $115 per month.)

The best part of the Touch Diamond is its beautiful craftsmanship, but the touchscreen and functionality come in a close second. The handset is sleeker and smaller than the iPhone at 102mm in height by 51mm wide by 11.33 mm thick. (The iPhone 3G, which sports a 3.5-inch screen with 480-by-320 pixel resolution, is 115.5mm by 62.1mm by 12.3mm.)

The back of the Touch Diamond has diamond contours that drew “ooh”’s and “aahh”’s of praise whenever I showed it to friends, but, there is one problem with the handset’s exterior—as with many gadgets that have a glossy finish, it holds fingerprints.

The 2.8-inch touchscreen dominates the front of the Touch Diamond and the 640-by-480 pixel display resolution is beautiful. I’ve never seen nicer screen quality on a phone. You can even see it well in direct sunlight because the screen auto-adjusts for different lighting conditions.

The Touch Diamond uses Microsoft Windows Mobile 6.1 as its OS; it’s an easy-to-use program that’s familiar to people who use Microsoft products on their PCs.

The company’s TouchFLO 3D software makes the device relatively simple to use, but I had to read the instruction manual to get the hang of it. A lot of the movements start with your finger in the middle of the screen. So, if you want to scroll up, for example, you put your finger in the middle of the screen and flip upwards. At first I had tried swiping my finger up the entire screen, but that didn’t work well. Once I got it, though, it was easy.

The 3D view of the handset software is excellent. You can look through your contact list by picture with a sweep of the finger. The device comes loaded with applications, including Microsoft Mobile Office and two browsers, Internet Explorer and Opera. Both worked well, as did connecting to the Internet via WiFi or 3G, including HSPA (High-Speed Packet Access). The Opera browser was customized for HTC for one-handed Internet navigation.

Although surfing the Internet sucked power out of the battery, that’s generally the case with smartphones. The battery on the Touch Diamond is rated for four hours of talk time, and I used it for four days before having to recharge. That was before I tried accessing the Internet, however.

All in all, the Touch Diamond is a good phone with nice extras that will help give it a boost in a market enamored with the iPhone 3G and its features.

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