Verizon, Google Working on iPad Rival

"We're working on tablets together," said Lowell McAdam, Verizon's chief executive. "We're looking at all the things Google has in its archives that we could put on a tablet to make it a great experience."

Basking Ridge, N.J.-based Verizon said the tablet PC project is a result of its deepening relationship with the Internet search giant, whose Android mobile operating system is used in a number of devices it carries.

Last year, the carrier heavily pushed the Motorola Droid, which is powered by Google's software, and it plans to do the same for the HTC Droid Incredible, its new flagship Android phone.

Verizon declined to provide further details on the tablet and Google's part in the project wasn't immediately clear.

Mountain View, Calif.-based Google has said it was working with hardware makers and wireless operators alike to create lightweight computers that run its mobile operating system.

As rivals such as Apple release tablets, the Internet search giant is looking for new ways to port its software through its partnerships. The company plans to announce a new project with tech giants Sony and Intel later this month, aimed at bringing its Android platform to televisions.

While the telecom business is still primarily about handset, data services for wireless devices such as tablets, netbooks and even dog collars, are a fast-growing stream of addition revenue for operators. And AT&T is in the lead, not just the provider for Apple's iPad, but also Amazon's popular Kindle e-reader.

McAdam admitted that Verizon has some catching up to do in the segment. "They were able to get out of the box faster," he said, adding that the company will have new devices ready for launch early next year, once its high-speed fourth-generation, or 4G, network is rolled out.

"The old model of one price plan per device is going to fall away," McAdam added. He said he expects high-speed networks to change the way current unlimited-use plans are priced, with carriers offing a "bucket of megabytes."

The Verizon-Google partnership underscores the increasing friction between Verizon and AT&T, and Google and Apple, as they all vie for a piece of the fiercely-competitive, and highly-lucrative, smartphone market.

The two largest U.S. wireless carriers have battled each not only in the courtroom, but also on the airwaves.

Meanwhile, in March, Apple sued HTC, the Taiwan-based maker of Google's Nexus One device, for infringing on its iPhone patents, which many analysts see as an attack by proxy against the Internet search giant.

Both Silicon Valley titans have also been aggressively buying start-ups to gain an advantage in their devices. Last month, Google even scooped up Agnilux, a mysterious early-stage semiconductor company started by ex-iPad employees.

HP, which recently acquired Palm for $1.2 billion, is also jumping in the mix, developing its own tablet, based on the handset maker's WebOS mobile operating system.