The iPhone’s biggest (shipping) competitor is the Google Adroid-based G1 from T-Mobile. According to Engadget, T-Mobile is now doing over-the-air updates to the G1 to the Android 1.5 (Cupcake) OS.
BGR is also reporting that like iPhone nano rumors, Palm rumors also say that they are going to release a smaller Pre this year. That thing pictured to your right is supposed to be it ->. It is based on the current Centro hardware.
In related news, I show you how to build a pretty sweet Android tablet for $220 out of a Nokia N810 here. Just so you know.