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During his keynote address yesterday at the Consumer Electronics Show (CES) in Las Vegas, Bill Gates demonstrated the first pocketable Windows Vista computer, OQO's model 02. The one-pound, 5.6 x 3.3 x 1.0-inch device is the follow-up to the Windows XP-run Model O+, itself an upgrade to OQO's first handheld-sized PC, the model O1, which first shipped back in 2004.

The model O2 is pretty much an across-the-board upgrade over the previous edition. And whereas the model O1+ wasn't considered a Ultra Mobile Personal Computer (UMPC), the companies are calling the model O2 the first handheld-sized PC in a new UMPC Pro category.

OQO says model 02 is up to four times faster than the last version and its display is over six times brighter. The slide-out QWERTY thumb-keyboard is now backlit and TouchScrollers - for horizontal and vertical scrolling - have been added for easier input and navigation.

There's also a bevy of wireless connectivity options integrated into the model O2: Sprint-powered EV-DO 3G cellular, 802.11a/b/g Wi-Fi, and Bluetooth 2.0 with A2DP to support wireless stereo headphones.

In addition to a USB 2.0 port, a microphone, 3.5mm audio out headphone jack and line-in connecter, and VGA out, the model O2 includes a HDMI-out multimedia port. HDMI (High-Definition Multimedia Interface) is designed to replace the maze of cabling used for home entertainment centers with a single connector.

In addition to Windows Vista, the model O2 is built on 1.5 GHz VIA ultramobile processor, 60 GB hard disk drive, and 1GB of RAM. It sports an 800 x 480 pixel 5-inch touch-screen that can be interpolated up to a 1200 x 720 pixel resolution.

While the standard removable lithium-ion polymer battery promise a mere 3 hours of power, a double capacity type is available to deliver twice as much juice.

The rugged magnesium alloy chassis of the model 02 is a sleeker black now as well.

And there's an optional docking cradle that includes a choice of a dual layer DVD±RW/DVD-RAM or CD±RW/DVD-ROM optical drive, HDMI and Video out, 3 USB ports, 100 Base-T Ethernet, and an audio out / line-in port.

The model 02 starts at $ 1499. OQO is taking orders now and the device is expected to ship before the end of this quarter.