The mobile music/video revolution is gaining pace, and O2 finally catches up with its new
O2 Xda Flame. From its successful Atom Exec design (barring some production and battery issues they had earlier), the Flame adds 3G capabilities (HSDPA unconfirmed though), wifi-g support, 2GB storage space, VGA resolution and a NVidia GeForce Fo 5500 graphics chip, plus a few more things. More info
here.
It hasn't appeared on
O2's official site yet, but advertising has already been put up (from HK's Mong Kok Computer Centre), so release should be fairly imminent.

I have to wonder though, who are they targeting? Business customers who some how have time to watch movies, listen to music, and play games? That's quite a small niche if you ask me. The Windows Mobile platform is far from suitable for the young and hip consumer crowd - its first and foremost goal was for business users and hence it was designed for that. Yet it is that consumer group that will utilise the multimedia abilities of this phone the most.
Windows Mobile revolves around an organiser (i.e. datebook, tasks, contacts, notes etc.) and phone, with other abilities mostly relegated to the back seat. The interface is designed for business users too - its virtually devoid of graphics except the home screen, and there's no animations at all. Nothing screams out multimedia or graphics apart from Windows Media Player hidden in the Programs menu and the camera (I hope they've improved it now).
Windows Mobile 6 (aka Crossbow) improves this a bit, but ultimately these are two very different consumer groups and I don't believe its possible to target both with the same interface. One judges a device based on its business functionality, the other judges it on style and entertainment value.
HP has tried and largely failed I reckon with their
Mobile Media Companions (never seen anyone with one yet). Its not a phone, but did run Windows Mobile. They went out of the way to design special software for it too to promote the multimedia abilities more. It did look physically ugly though.
O2's got a pretty good history of providing good additional in-house & 3rd party apps for their devices (e.g. O2 Phone Plus, O2 Media Plus etc.) - let's hope they manage to do something special for this; otherwise I can't help but think the multimedia improvements would be wasted.
The additional load on the battery would be interesting to see (is the tradeoff between battery life and multimedia features worth it?), given my existing Atom already struggles without the added stuff, but I've already rambled on enough about that here.