Talk about a red-hot phone: Small, light, gorgeous interface, and the sharpest display I've ever seen on a cell phone. Watch out, iPhone.

I finally had a chance to paw the HTC Touch Diamond at a New York City trade show, and ... whoa, it's nice. With its VGA-resolution screen, the Diamond's razor-sharp display is really something to see, and I was shocked by how thin and light (just 3.9 ounces) the phone felt in my hand—much lighter than the 4.7-ounce iPhone, I might add.

HTC has clearly gone to great pains to perfect its animated TouchFlo interface, and the effort has paid off. A row of icons at the bottom of the screen lets you switch from one function to another (such as music, photos, messaging, and calling) by just swiping your thumb back and forth—and as you do so, items twist and twirl into view. Pretty awesome.

Especially impressive was the messaging interface, which lets you preview e-mails that slide out of an animated envelope. I also loved the weather widgets, complete with moving clouds and dripping rain that "splashes" onto the screen; don't worry, windshield wipers appear to wipe off the drops. It makes the iPhone's weather widget look pretty plain in comparison.

Of course, if you dig deep enough, you'll eventually find the Pro version of Windows Mobile 6.1, which is a bit of a buzz kill. Reps confided that HTC did its best to "bury" Windows Mobile, and indeed—there's a lot you can do on the Diamond's TouchFlo interface without ever dipping into Microsoft's tricky mobile OS. Still, you can always use the spinning, four-way navigational wheel to help you navigate any Windows Mobile menus you stumble across.

Just to recap, the Touch Diamond also comes with access to North American HSDPA networks for 3.5G Web browsing and downloads, plus Wi-Fi, Bluetooth, GPS, 4GB of flash storage, a 3.2MP camera (pretty nice compared to the iPhone's 2MP snapper) and accelerometers that flip the screen when you turn the Diamond on its side.

So, when will the Diamond arrive stateside? September, I'm told—both through carriers and unlocked. No official word on pricing, although the unlocked Diamond goes for about US$500 in Europe, so we can probably expect the equivalent come September.

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Can HTC's touchscreen Diamond outshine the iPhone?