Palm Inc.(PALM) on Thursday introduced a version of its Treo smart phone, and said it would begin a $25 million marketing campaign to expand demand for the phone beyond its base of business users.

The new Treo 680 aims to meet growing demand for so-called smartphones — devices that receive e-mail wirelessly, let users listen to digital music, and handle other features beyond talk. Research In Motion Ltd.'s (RIMM) Blackberry is best known for its e-mail capabilities.

Competition in the smart phone market is heating up as rival Motorola Inc.(MOT) started selling its "Q" in July and Nokia launched the E61 in April.

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Palm Chief Executive Ed Colligan said the device would be a "more friendly and approachable" model, and would come in a variety of colors. He said the price would be more affordable than previous models, but declined to give specifics, since carriers would determine the final price consumers pay.

"It will be competitively priced with comparable smartphones in the marketplace," he said at a press conference in New York.

He added that the marketing campaign would entail an investment of $25 million between Palm and Vodafone Group Plc (VOD) — Palm's biggest marketing campaign in five years.

Palm last month introduced a version of the Treo with Vodafone, the world's biggest mobile service provider.