Acer just recently jumped into the smartphone market, but it's looking to make a major impact by offering handsets that are low cost or free with a service contract.

Despite the economic downturn that will lead to a rare decline in the overall mobile phone market, smartphones are expected to see rapid growth. Most industry watchers think shipments could rise by as much as 11%, but Acer said an annual growth rate of 15% is possible if companies can provide lower prices.

"We want to put in front of the customer a smartphone that they can move up to for the same price as a feature phone," said Acer's Aymar de Lencquesaing during a press conference at the CeBIT trade show.

Acer said it entered the smartphone world because consumers are increasingly accessing the Web from their mobile devices. The company expects that trend to continue and said it's only a matter of time before cell phone makers move into its territory by making netbooks or mobile Internet devices. Nokia, the world's largest cell phone manufacturer, has already said it's "actively looking" at making laptops.

Acer plans to release four smartphones with Windows Mobile 6.1 by the end of April, and the handsets will be aimed at different consumer segments. The M900 is meant for business users, and it has access to corporate e-mail on the go, a touch screen, and a full slide-out QWERTY keyboard. The F900 relies on a touch-screen interface, and it has 3G and a 3.2-megapixel camera. The X960 has a smaller form factor that will have a heavy emphasis on navigation features, and the DX900 will have two SIM card slots.

No U.S. cellular operator has officially announced it would pick up Acer's smartphones, but the move could potentially provide increased revenue because it would mean more customers would sign up for a data plan along with voice services.

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