They say good things come in small packages. That certainly is true of the new INQ Social Mobile phone from INQ, a subsidiary of Hutchinson Whampoa, a global wireless company that runs 3G networks in eight countries around the world, including the UK and Australia. INQ’s new triband-with-3G phone is diminutive — 110 g (3.9 oz) — but it packs a powerful punch. It is smaller than a bar of Baby Ruth chocolate and is likely to cost about $50 a pop. INQ’s new phone will make a debut on the 3 network in the UK later this week, and it should raise some eyebrows and impress many.

Hutchinson’s 3 network caused a sensation last year when it released a phone that was designed around Skype and Skype’s communication abilities. The phone proved to be a commercial and critical success. Encouraged by its success, Hutchinson decided to spin out its handset operations into a standalone company to sell phones to carriers other than 3.

The result is a new phone — the first of many — that is chasing what is going to be the biggest trend in the mobile industry: application-specific mobile phones. Frank Meehan, CEO of INQ, last month said that while “iPhone and BlackBerry Storm are sensational devices,” the fact remains that carriers need more lower cost devices with great UI. “INQ isn’t meant to compete with those top end devices, but instead is designed to get the core Internet comms services easy to use for the mass market,” Meehan said. I agree, and after using the phone for less than a day on a slower EDGE network, I can only imagine how good a device it will be on faster networks. And its sole purpose is to keep the data usage growing on the mobile networks so that carriers can recoup the money they spent building their 3G networks.

The phone is based on Qualcomm’s 6260 chipset and uses the Brew OS. The device’s whole experience is optimized for a few web applications — Skype (obviously), Facebook, Google, instant messaging and other apps like Last.fm. All the apps show up at the bottom of screen, reminiscent of Apple’s (s APPL) App Dock, which makes it easy to navigate through many apps. (I wonder when Nokia (s NOK) will buy some clues and make navigating through apps easy.)

The apps themselves have been optimized for the tiny screen experience, and worked flawlessly over a T-Mobile 2.5G EDGE connection. The Facebook app, for instance, was easy to use: I could snap pictures with the 3.2 megapixel camera and post them to Facebook with relative ease. I was suitably impressed with the way INQ has integrated Skype, Facebook and IM into the phone’s address book and developed a next generation communication experience. The phone has a decent browser (Netfront 3.4) that can handle Flash, and the screen, while tiny at 2.2 inches, is good enough to use the web applications effectively.

I wish I could have tested the phone on a 3G network and not been limited by the slower EDGE connection.  Being on a slow connection, I couldn’t really use Skype effectively, and I find doing messaging (IM) or replying to emails using a 12-key dialpad impossible. But I am sure there are folks who are not challenged by big thumbs and advancing years.

Now, this device isn’t going to work in the U.S. — which is a shame because I really love this tiny-yet-simple device. It is like the Toyota Scion of the mobile world — well designed, cool, functional and inexpensive.