NEW YORK -- Move over, Apple (AAPL Quote), Research In Motion (RIMM Quote) and Motorola (MOT Quote), Google (GOOG Quote) is jumping into the smartphone market with an Android phone of its own. In what is likely to be seen as disruptive to the wireless status quo, Google is working with a smartphone manufacturer to have a Google-branded phone available this year through retailers and not through telcos, according to Northeast Securities analyst Ashok Kumar, who has talked to Google's design partners about the plan.
The move would fulfill Google's pledge to bring a new generation of open-standard mobile Internet devices to consumers. By bypassing the carriers, who keep tight controls over the features and applications that are allowed on phones, Google will presumably offer a device that lets users determine the functions.
Both the Chrome netbook and the Android phone will use Qualcomm (QCOM Quote) chips, with the netbook running on Qualcomm's Snapdragon platform, says Kumar, who has discussed the plan with original design manufacturers working with Google.
Android's Mobile Land Grab
If talk of the Google phone plan is true, the entrance of a unlocked, low-cost, Web-friendly touchscreen device will probably undercut other Android phone efforts by players like Motorola, Samsung and Dell (DELL Quote).
Motorola's entire turnaround strategy is based on the Android operating system. The company is expected to announce a ultra-thin Droid phone at Verizon (VZ Quote) next month. Both Verizon and Motorola expect the Sholes/Droid phone to be a significant challenger to Apple's iPhone.
Dell is also working on an Android smartphone, which is expected to be ready early next year at AT&T (T Quote).
Skeptics point out that Google might have a hard time getting the phone out in time for the holidays, since it typically takes a year or more to bring a phone from design to production. Industry analysts also argue that the move would be an affront to the U.S. carriers like Verizon, AT&T, Sprint (S Quote) and Deutsche Telekom's (DT Quote) T-Mobile, outfits that have been supporting the Android effort by selling or planning to sell subsidized devices.
"It's a bit of a departure from Google's strategy, but I think the speculation is valid," says Michael Cote of the Cote Collaborative. And as for getting the phone to the market quickly, Google "would probably use a partner they are familiar with."
HTC, the first developer of an Android phone, is also a no stranger to Qualcomm chips and would be the most likely manufacturer able to give Google what it wanted fast.
If Google goes through with the plan, it would point to how eager the Internet ad giant is to get Android in as many hands as possible so it can extend its search business beyond desktop computers to mobile devices. Going around phone companies to reach consumers is a bold move, but Google no doubt sees the wireless Internet market as a land-grab race with Apple, Nokia (NOK Quote) and Microsoft (MSFT Quote).
Google also has plans with computer maker Quanta to build its own netbooks that will run on a Linux-based Google Chrome operating system and be available next summer, says Kumar.
Representatives for Google, HTC and Quanta were not immediately available for comment.
Google shares were down 0.8% to $547.78 in recent trading.
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