Set to ship in the U.S. next month, the pint-sized, LED-based projector connects to your phone (yes, iPhones included) or digital media player and throws a sharp-looking image onto a nearby screen or surface. Cool, right? It'll cost you, though.

I got a chance to check out the Pico PK-101 at a pre-CES event in New York City last night, and yes—it's pretty nice, and unlike so many of the pico projector prototypes I've seen at past trade shows, the PK-101 ($399) is actually going on sale soon: on Dec. 15, to be exact.

About the size of a deck of cards and weighing in at four ounces, the PK-101 comes with a tiny built-in speaker (just half a watt), a focus control, and a cable with a 2.5mm minijack on one end and composite video/stereo audio RCA inputs on the other. (A $30 cable for iPods and iPhones will also be available.)

Attach your phone/PMP to the projector, turn it on, and voila—you'll get a reasonably sharp looking image (actual resolution: 480 by 320), anywhere from six to 60 inches across. At last night's demo, the PK-101 was only a few inches away from the screen, yielding an image that was about a foot across.

Image quality? Not bad, actually—it's tough to judge in a brightly-lit conference hall, of course, but the picture looked reasonably sharp to my eyes, if a bit washed-out. Believe me, I'd be more than happy watching iPhone movies with the PK-101 on a cross-country flight.

According to Optoma, the PK-101's replaceable battery is good for about an hour and a half of viewing time, and you can always swap in the extra battery that comes in the box.

Overall, pretty cool—although at $399, the PK-101 will cost twice as much as your 8GB iPhone 3G. Then again, we're talking about one of the first commercially available pico projectors in the U.S.; prices are bound to drop, and in a few years, I'll bet you'll see pico projectors popping up everywhere (both as accessories and in handsets themselves). I can't wait.

Update: Turns out 3M had a pico projector of its own at the CES preview—so small, apparently, that I completely missed it. Gearlog has the scoop right here.