Rumors have persisted over the last year and a half that Google would release its own branded cell phone; the company has repeatedly denied the gossip, emphasizing its concentration on Android as a mobile operating system that it licenses to existing cell-phone makers.

Now the NY Times reports that Google employees have received a Google-designed handset to test. An official Google blog entry, posted Saturday, calls the handset a "mobile lab" that company employees are using "to experiment with new mobile features and capabilities." The company has not commented beyond this post.

The touch-screen smartphone is made by HTC--maker of most commercially available Android handsets--to hardware and software specifications set by Google. Reports claim that the company plans to sell the new phone directly to consumers over the Internet. It apparently works on GSM networks, which would mean AT&T and T-Mobile only in the U.S. That would put Google directly in competition with Apple and its AT&T-only iPhone.

UPDATE: Pictures of the phone have surfaced on various blogs... they match previous descriptions of its looking like the upcoming HTC Passion (rumored to run Android 2.1).

Today T-Mobile announced the second "Google phone", the MyTouch 3G. Like the G1, it's built on Google's Android operating system--an open-source platform for mobile devices that's intended to allow for extensive customization and application development.

Clearly timed to compete with the new iPhone release, the MyTouch will sell for $199, and boasts a touch screen, applications available through the Android store, and, of course, 3G access. Existing T-Mobile customers will be able to reserve the phone starting July 8.

It'll be interesting to see how the existence of two Android phones affects the market. Some people may have hung back from purchasing the first Android phone, the T-Mobile G1, due to uncertainties about how the platform would evolve.

Amid buzz about a possible Google Phone, today the Internet search giant revealed its plans for a move into the mobile world. (See "Why Did Google Buy Jaiku?") The bad news is that there is no Google Phone, according to Andy Rubin, the company's director of mobile platforms. The company's good news is that Google does have a plan for mobile--and a far-reaching one at that. The company announced that it is launching Android, a platform for mobile devices that includes an operating system, a user interface, and applications. The system is designed to combat the problems that developers face with mobile phones: that every phone is radically different in terms of its specifications, and applications usually have to be redesigned for each individual model of phone. (See "Making Your Phone Smarter.") If phone carriers and manufacturers adopt the Android platform--and Google seems to have already lined up some who say they will, in the form of the Open Handset Alliance--phones could get much more powerful as developers become able to concentrate their resources on building applications rather than on rebuilding them. Google's strategy also seems to involve improving Web services to mobile phones. Rubin's entry on the Google blog gives the impression that Android is only a small part of the company's strategy in that arena.