GPS device giant Garmin is developing an Android-based smartphone for debut in 2009, but analysts said the newcomer faces several challenges in staking a claim in the competitive marketplace.

The Android announcement yesterday is Garmin's (NASDAQ: GRMN) second phone development effort. It announced its first device, the Nuviphone, back in January -- but that product has yet to hit the market.

The news comes as the smartphone space continues to see white-hot competition and is largely dominated by two names: Apple's iPhone and Research in Motion's BlackBerry line. Yet despite the competition and a depressed economy that is hurting other technology segments, most handset makers and wireless carriers are all enjoying strong revenue, thanks to growing device adoption and Net access plans.

A ChangeWave survey this week reported that it found 12.2 percent of mobile phone owners plan on buying a smartphone during the next 90 days, a jump of 0.3 percent compared to its September survey. Meanwhile, an IDC study found that smartphone growth will be 8.9 percent in 2009.

Cashing in such trends is the reason why vendors are pushing new products, applications and services into market at lightning speed. But the market trends don't guarantee clear sailing, especially for new entrants, experts said.

And the list of new vendors aiming to push out Android phones next year is growing every month. Garmin was just one of 14 companies to have recently joined theOpen Handset Alliance, a Google-backed group overseeing Android development.

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