Google branding own handset?
A Google company blog post  over the weekend raised questions as to whether a new phone being tested by Google employees is just a way for employees to improve on the Android operating system, or whether it is an actual prototype that will be released in 2010.
Numerous sources online have reported the device’s existence, including photos of a handset that resembles a cross between the HTC Hero and Passion, running Android 2.1.
Few specs for the Nexus One are known; however, most reports suggest that the phone is an unlocked GSM device that will sell directly to consumers. Such a move would mean Google would go head-to-head with Apple's iPhone and Research in Motion's Blackberry, as well as current makers of Android phones.
Additionally, HTC has filed a report for the Nexus One with the Federal Communications Commission.
In the blog post, Google said the new device combines hardware built by an unnamed partner with its Android software. The free software is crucial in Google's efforts to make its search engine and other services as accessible on cell phones as they already are on personal computers.
Ken Hyers, senior analyst for Technology Business Research, questions the logic of a solely Google-branded device. "What I find fascinating is the idea that they are just on the cusp of some really good success, and now they're going to go and compete with their own partners. I don't think it's wise," Hyers said.
Hyers said that Google may see an opportunity to develop a device that connects to all of Google's applications and services. However, he still finds the idea full of holes. "The great thing about an unlocked GSM phone is that you can take it anywhere. However, Nokia's tried that in the United States and failed miserably," he said.
"Nokia has had great success with the unlocked model in Europe. So maybe we shouldn't look at this strictly from a U.S. viewpoint," he added, noting that if the device is being developed for an international market, it would not be in direct U.S. competition with Google partners such as Motorola and HTC.
Mountain View, Calif.-based Google launched its first Android phone in September 2008, the G1 sold by T-Mobile USA. Verizon Wireless last month released the Droid, the first smartphone to run Android 2.0, and expects to launch another Android phone this year.
– The Associated Press contributed to this report