Lenovo's?CEO Yang Yuanqing, together with COO Rory Reed, shows its first smartphone?called Lephone at the Consumer Electronics Show in Las Vegas.??

Computer maker Lenovo Group yesterday said it considers mobile Internet as its next big opportunity and would further expand its presence in the smartphone market.

The company said the time has come for it to expand its horizons as the traditional boundaries between computers and mobile phones are fast collapsing.

Yang Yuanqing, chief executive of the world's fourth largest PC maker, said smartphones have already made their presence felt after the advent of 3G services.

"For us, the next big opportunity is the mobile Internet, while mobile devices are natural extensions for PC makers," he said at a news conference at the Consumer Electronics Show in Las Vegas.

The statements are seen by industry experts as Lenovo's first moves after it said in November last year that it would spend US$200 million to buy back the cell phone business it sold to a group of investors.

Lenovo had divested its mobile phone business in February 2008 for US$100 million to boost profitability.

The company now has the capacity to provide mobile and small portable devices, said Yang.

Meanwhile the company yesterday showcased its first smartphone called Lephone in Las Vegas. Based on the Android operating system, the product would debut in China later this year.

Lenovo also showcased a new "smartbook" dubbed Skylight as well as a new notebook, which has a detachable screen.

The company's core business was severely impacted during the global financial crisis, as corporate customers reduced IT spending to cut costs.

But the company ended three straight quarters of losses in November last year, as robust demand from emerging markets and a series of cost-saving measures helped negate the declining sales in mature markets.

Yang said besides the traditional notebooks, Lenovo would also focus on smartbooks and smartphone products that provide better portability to consumers.

Lenovo expects mobile Internet users in the country to grow at "an explosive pace" in the next few years, as the 3G services would enable faster data transmission speeds via handsets.

According to figures from China Internet Network Information Center (CNNIC), mobile Internet users in the country reached 155 million by the end of June last year. The number of computer-based Internet users rose to 338 million.

Research firm Gartner predicts that China would have 90 million smartphone users by 2014.

Lenovo's peers Dell and Acer have already launched smartphones in China.

According to official figures, China had over 700 million mobile phone users by the end of last year. Of these, 3G users alone were 15 million.