MOUNTAIN VIEW, Calif. (AP) - The once-cuddly relationship between Google Inc. and Apple Inc. is morphing into a prickly power struggle as the ambitions and ideas of the technology trendsetters increasingly collide.

The Nexus One phone from Google Inc. is shown at a demo in Mountain View, Calif., Tuesday Photo: AP

The growing use of high-powered phones for web surfing has become a flash point in the brewing battle because both Google and Apple view the mobile market as a key to their continued success in the next decade.

The rivalry also is spilling into other products, including web browsers, computer operating systems and digital music.

The tensions rose further when Google unveiled its plans to sell its own cell phone in its latest bid to upstage Apple's hottest gadget, the iPhone.

Meanwhile, Apple is taking a stab at Google's heart by expanding into advertising sales. Apple let it be known that it had bought a mobile advertising service, Quattro Wireless, just before Google held a news conference at its Mountain View headquarters to announce the Nexus One.

Quattro gives Apple its own platform for distributing ads on the iPhone, and conceivably could serve as a marketing vehicle for a computing tablet that Apple is expected to introduce near the end of the month. The acquisition also serves as a counterpunch to Google's proposed $750 million acquisition of Quattro rival AdMob, a deal which may be tied up in a regulatory review for several more months.

Meanwhile, the iPhone has turned into a gold mine for Apple, with more than 30 million of the handsets sold in the past 2 1/2 years and demand still growing. It has helped boost Apple's annual revenue from $24 billion in fiscal year 2007 to $36.5 billion in its most recent fiscal year, which ended 26 September.

By designing and selling its own phone, Google will have another way to ensure its services remain within easy reach of people on the go.