According to a new report, the allegedly in-development Google Phone isn't a phone at all, but a mobile operating system designed to compete with Microsoft's Windows Mobile offering.
The International Herald Tribune cites "industry executives familiar with the project" as saying that Google's phone initiative is actually a full scale OS, based on Linux, and designed to be offered to phone manufacturers free of charge. Google would then make its money through using the OS to deploy targeted mobile advertising, much the way that their search engine works.
The report goes on to say that part of Google's strategy is to make their operating system open-source, in an attempt to undercut Microsoft and "take the economics out of the Windows Mobile business," according to an anonymous source described as an industry executive whose company has ties to Google.
Google: No official position
Despite the dozens of rumors surrounding it, Google still has little public position on their phone plans, other than saying that mobile phones presented a large growth opportunity and that Google has significant investment in mobile services.