Google Phone is in the works, say insiders

By Eric Auchard

SAN FRANCISCO (Reuters) - Google Inc. is developing its own mobile phone, according to industry insiders and analysts, while a Google official in Spain last week acknowledged the company is "investigating" such a project.

Google isn't commenting directly on leaks from Europe and the United States which describe a low-cost, Internet-connected phone with a color, wide-screen design. Newspaper and blog reports in recent months have Google shopping its phone design to potential mobile phone manufacturing partners in Asia.

"Mobile is an important area for Google," Google spokeswoman Erin Fors said on Friday. "We remain focused on creating applications and establishing and growing partnerships with industry leaders to develop innovative services for users worldwide. However, we have nothing further to announce."

Gadget enthusiasts who only two months ago were obsessed with the potential revolutionary impact on the phone industry of Apple Inc.'s iPhone device -- due out in June and at prices starting at $500 -- have shifted their attention to whether Google is developing an even lower-cost phone.

"We obviously need another mythical mobile to drool over and speculate about -- and the natural candidate is, of course, the so-called Google phone," geek hardware site Engadget wrote earlier this month tinyurl.com/3b7bow.

To be sure, feverish speculation about Google products has been wrong before. Google was widely reported to be building its own line of personal computers a little over a year ago. What in fact materialized was a set of free software programs designed to make any existing Windows PCs easier to use.

But Richard Windsor, a phone analyst with brokerage Nomura in London, told clients late last week that unspecified Google representatives at a major European conference in Germany had confirmed the company is working on its own phone device.

"Google has come out of the closet at the CeBIT trade fair admitting that it is working on a mobile phone of its own," Windsor said in a note entitled "Google Phone: From myth to reality."