Technology News- Gphone launch delayed until end of 2008

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Google's ambitions in the mobile industry have suffered a setback after it was reported a new handset powered by the search giant's software is now unlikely to appear until the end of the year.

The so-called 'Gphone' – a handset powered by an operating system Google has helped design - had been slated for release in the second half of the year, but Google now says it will more likely appear in the fourth quarter.

A director of mobile platforms at Google told the Wall Street Journal that the development of the Gphone, which requires the involvement of handset manufacturers as well as mobile operators, was taking its time. "This is where the pain happens – we're very, very close," he said.

In November Google announced an alliance of 30 partners who would co-operate on a handset designed to allow owners much greater control over the device – in particular the types of web-based features that the phone would offer.

Google hopes the operating system it has designed – called Android – will help its ambitions to generate more revenue from internet advertising as more and more people begin to access the web on their phones.

But handset manufacturers and operators are having to work out how their devices will accommodate the new system – a process that it taking longer than anticipated.

T-Mobile USA is hoping it will be able to deliver an Android-powered phone in the fourth quarter, but that release is taking up so much of Google attention and Sprint Nextel - another Android partner – will not be able to put out a device until next year, according to reports.

China Mobile, the world's largest carrier by subscriptions - with nearly 400 million accounts – had been hoping to release an Android-powered in the third quarter, but according to the Wall Street Journal, it will now delay the release until later in the year or even early 2009.

In Europe, Google's partners are also suggesting that a launch towards the end of summer – a date which had been mooted by some – is now unrealistic. "We think some time closer to Christmas is more likely," said a source close to one operator partner.

HTC, the Taiwanese handset manufacturer which many suspect will be the first to release an Android-powered device, declined to comment. France-Telecom, which owns Orange – another Android partner – and has a whole research and development division in Shanghai devoted solely to the development of Android services, was also unavailable for comment.

Google has given its partners several prototypes of Android phones, but both manufacturers and operators are tight-lipped about how the final versions - of which there are likely to be many - will appear. One prototype has a touchscreen similar to the Apple's iPhone, as well as a sliding keyboard and a 'trackball' navigation tool that is reminiscent of a BlackBerry handset.

Meanwhile Google is continuing to woo software developers who, it hopes, will make applications that owners of Android handsets can download from the internet. Android is what is known as an open source operating system, which means that any developer who wants to make a programme that runs on it can access the system's code.

Google and other its partner developers building services for the Android platform hope they can come to an agreement with operators about how any revenue generated from a web-based service on an Android phone – for instance an ad that appears alongside a web page – is divided up.

But operators are wary of giving up too much revenue from any service which relies on data that is carried over their networks.

Meanwhile companies which have not signed up to Android – including Apple, which recently launched its 3G iPhone and Nokia, the world leader in smartphones with a 52 per cent share, have launched rival platforms to maximise the amount of revenue that is generated from web-based services on mobile phones.

Many developers are said to favour the iPhone, which has a 28 per cent share of the smartphone market in the US despite only being released a year ago - because of its similarity with the existing Apple Macintosh operating system.