Exclusive: Google to Crash Android Party

(Updated from 10:59 a.m. EDT)

NEW YORK (TheStreet) -- Move over, Apple (AAPL Quote), Research In Motion (RIMM Quote) and Motorola (MOT Quote), Google (GOOG Quote) is jumping into the smartphone market with an Android phone of its own.

In what is likely to be seen as disruptive to the wireless status quo, Google is working with a smartphone manufacturer to have a Google-branded phone available this year through retailers and not through telcos, according to Northeast Securities analyst Ashok Kumar, who has talked to Google's design partners about the plan.

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The move would fulfill Google's pledge to bring a new generation of open-standard mobile Internet devices to consumers. By bypassing the carriers, who keep tight controls over the features and applications that are allowed on phones, Google will presumably offer a device that lets users determine the functions.

Both the Chrome netbook and the Android phone will use Qualcomm (QCOM Quote) chips, with the netbook running on Qualcomm's Snapdragon platform, says Kumar, who has discussed the plan with original design manufacturers working with Google.

Android's Mobile Land Grab

If talk of the Google phone plan is true, the entrance of a unlocked, low-cost, Web-friendly touchscreen device will probably undercut other Android phone efforts by players like Motorola, Samsung and Dell (DELL Quote).

Motorola's entire turnaround strategy is based on the Android operating system. The company is expected to announce a ultra-thin Droid phone at Verizon (VZ Quote) next month. Both Verizon and Motorola expect the Sholes/Droid phone to be a significant challenger to Apple's iPhone.