The search giant is actually making hardware, specifically a smartphone. The giveaway quote:
We recently came up with the concept of a mobile lab, which is a device that combines innovative hardware from a partner with software that runs on Android to experiment with new mobile features and capabilities, and we shared this device with Google employees across the globe. This means they get to test out a new technology and help improve it. Unfortunately, because dogfooding is a process exclusively for Google employees, we cannot share specific product details. We hope to share more after our dogfood diet.
Again the all-important question, and I don’t mean the question on whether this GPhone can kill the iPhone, is, will Android phone suffer due to a Google-branded phone. Gigaom thinks that Google will definitely come out with its own phone brand. They worry that Android devices will begin to stray too far from how Google conceived of the Android mobile OS. Perhaps by manufacturing a perfect phone as Google envisions it, they can stop the marauding iPhones on their tracks and offer the world a real competition to the Mac OS X mobile OS.
[via gigaom]
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