New reports suggest search giant Google is believed to be working on a mobile operating system and not a handset device as previously speculated.
Engineers at the company have been working on a secret mobile project for two years and observers had until now believed the project involved a mobile handset, which some had dubbed the "iPhone killer".
However, according to latest reports, Google is now believed to be working on a Linux-based operating system for use on all makes of mobile phone, pitched not against Apple, but rather existing mobile OSs such as Symbian or Microsoft's Windows Mobile.
Analysts believe Google wants to extend its dominance of online advertising to the rapidly growing mobile internet market and is hoping to persuade mobile providers and phone manufacturers to offer phones running its software.
The cost of those phones may be partly subsidised by Google-managed advertising appearing on their screens. The company is also expected to integrate its full suite of applications into the new OS and develop its own mobile web browsing software.
Google has not make any official comment on the rumours surrounding its mobile plans, but the company's chief executive Eric Schmidt has said several times that the mobile market represents the biggest potential growth area for the company.
The company also revealed in July this year that it was considering bidding at least $4.6bn for wireless airwaves at a US federal auction. Some believe one of its major aims is to loosen the control carriers have over the software and services that are available on their networks. Google is expected to finally confirm its mobile plans later this year, with a possible product launch rumoured for 2008.
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