Amid rampant rumors and blog chatter, Google said Wednesday it is not developing an inexpensive PC.

The rumors of a Google-branded PC that would be marketed to consumers through Wal-Mart stores were fueled by a story in the Los Angeles Times and a scheduled speech that Larry Page, company co-founder and president of products, is scheduled to deliver Friday at the Consumer Electronics Show in Las Vegas.

Google made its statement brief and to the point, saying, “We have many PC partners who serve their markets exceedingly well and we see no need to enter that market; we would rather partner with great companies.”

Industry darling Google is no stranger to hype. Last October, a scheduled news conference with Sun touched off rampant speculation that the company would offer a suite of business productivity applications to rival Microsoft Office. When the dust settled, the agreement called for Sun to include the Google Toolbar as an option in consumer downloads of its Java Runtime Environment (JRE). The JRE is software that installs on a PC in order to run Java-based applications.

Experts question why Google at this time would want to venture beyond its lucrative Internet advertising model to take on industry giants such as Microsoft, HP and Dell in what would amount to brand-new ventures for Google.

“So what, you release a computer with a Google OS and a Google name, but people still have to do something with it,” says Joe Wilcox, an analyst with Jupiter Research. “If you had a basic device that people could buy and access the Internet say for search and maybe consume some services on a browser, I could kind of see Google going there. But that is about as far as I see them going, and even that is a stretch.” Wilcox also says based on the fact that Google is focused on hooking people to information that the Sun deal may ultimately have a server-based flavor rather than be aimed at the desktop or device level.

The PC rumor, however, is not the only one circulating ahead of Page’s appearance at CES. In December, Bear Stearns wrote a report that put forward the notion that Google possibly was developing a mesh-networking device that the investment company dubbed Google “Cubes.” The report was based on a column written in November 2005 by PBS columnist Robert X. Cringely.

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