The Wall Street Journal, which should know better, said that Google's move to hardware was necessary as Apple continues to encroach on the Internet-search giant's territory with major software applications.
But if that was the case why did Google release a tablet which was clearly not designed to do that? The Nexus 7 has only a seven inch screen and is about a third of the price of the iPad. It is less useful as a tablet, but is an ideal weapon to serve up mobile content on.
Kindle Fire runs Android and sells for $199. Amazon uses it to serve up its content including books, music and video. It has done extremely well, despite getting a drubbing from the Tame Apple Press.
The Asustek executive told Reuters that it was part of a cunning plan from Google to launch its own Amazon like service.
This would be a hell of a change for Google. At the moment it has its own App store but nothing like Amazon's service.
What it appears is that rather than trying to put out a tablet which competes with Apple, Google is planning to release shedloads of content under a new service and access it using its own tablet.
This has worked extremely well for both Amazon and Apple.
What Google's thinking appears to be is that Apple and Amazon succeeded, not because of its well designed hardware, but because it could offer the technically challenged an all in one service that they did not have to think about.
As far as taking on Amazon, it does not want to compete with its hardcopy books, but rather wants to set up a system of e-books and other electronic content which requires less capital to operate.
Google would have some difficult selling this idea, particularly at the outset, so it has done a deal with Asustek to flagship the entire operation, probably having the computer partner selling the gear cheap.
Once the service is up and running, other OEMs will be keen to sign up their Android tablets to run on it. Meanwhile Google has a small guaranteed market for its Amazon rival to build upon.
It is a damn sight more clever than anything as simple as "lets compete with an Apple tablet". And let's not mention Microsoft's cunning plans, OK? Samsung, of course, has a huge advantage over all these companies because it makes all the components that go into mobile phones and tabs. Init?