Google plans to unveil a US$199 ($252) tablet co-branded with Tawian's Asustek Computer at its developers conference this week, taking direct aim at Apple's iPad, according to two people familiar with the matter.

The 7-inch (18cm) tablet running Android mobile software will be shown at the Google I/O conference, starting today in San Francisco, said the people, who asked not to be identified because the plans are private.

The device will also showcase new features of Android, according to one person, who said the latest version of the software is named Jellybean.

Google is scouting out new ways to fuel sales of tablets, a market that may almost double this year to 118.9 million units, according to Gartner.


Though Android has grabbed more than half of the smartphone market, tablets with the software have won less than half the iPad's share, and will face new pressure from Microsoft, which unveiled its own tablet last week.

"The tablet market is a major challenge for Google at this point," said Clayton Moran, a Florida-based analyst at Benchmark.

"They need to have a competitive product with the iPad."

David Chang, chief financial officer of Taipei-based Asustek, declined to comment, as did Shari Yoder Doherty, a spokeswoman for Google.

Android tablets are already available from companies such as Samsung Electronics, HTC and Motorola Mobility Holdings, which Google acquired last month for US$12.5 billion.

Still, Google is aiming to capitalise on its own brand name.

It also seeks to woo consumers with a slimmer device that features the latest software yet carries a lower price than the larger iPad. The newest versions of Apple's tablet start at US$499.

"When you look at the tablet market, you have iPad - and others," said Rhoda Alexander, an analyst at industry researcher IHS iSuppli.

"Everybody is trying to figure out how to compete against the iPad. And I just see it as just one more experiment going down that road."

This would also be the first tablet to get Google's Nexus designation. Google has worked with manufacturers such as Samsung in the past for Nexus smartphones to highlight the best features of Android software.

The processor in the new tablet will be provided by Nvidia, one of the people familiar with the matter said.

Gartner expects the iPad to remain the global tablet leader through at least 2016, even as it loses some market share.

The iPad will account for an estimated 46 per cent of shipments in 2016, down from a projected 61 per cent this year.

Android may have 37 per cent by 2016, a gain from 32 per cent.

Microsoft, which had zero per cent of the tablet market last year, is expected to nab 12 per cent by 2016.

That number may increase, because the Gartner report was issued before Microsoft unveiled its Windows-based Surface tablet, which is likely to be released by the end of the year.

Sales of Android-based tablets have been held back by a lack of developers for the platform.

Apple's App Store has more than 650,000 downloadable applications that include games, news and travel tools for the iPhone and iPad.

Though Google Play has more than 500,000 for Android devices, Apple's success with the iPad has given it a greater lead in apps designed specifically for tablets, said Carolina Milanesi, an analyst at Gartner.

"At the moment, we don't see the ecosystem being strong enough to compete," Milanesi said.

"There's just not enough apps that give you a rich experience on the tablet as you have at the moment with Apple."

- Bloomberg