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Wednesday, May 23, 2012, 10:20 pm PT (01:20 am ET)

Rumor: Google, Asus to release joint 7-inch tablet in July

Google and Asus are gearing up to release a co-developed 7-inch tablet in July with initial shipments of 600,000 units, according to a new unverified report.

Taiwan's DigiTimes claimed on Thursday that, according to sources from the upstream supply chain, shipments of the device will begin in June in preparation for a July launch.

"Google originally planned to release its entry-level 7-inch tablet PC in May, but design and costs did not reach its expectations, and the product was delayed to July for some minor adjustments," the report read.

Author Monica Chen said shipments of the tablet are expected to reach 2-2.5 million units this year.

DigTimes claimed in March that the co-branded tablet would be in the low-end price range and compete directly with Amazon's Kindle Fire. Sources said at the time that Google had chosen to work with Asus because of its "ODM capability and good product quality," while Asus reportedly agreed to the project to gain an in with Google on Android device development and enter the U.S. tablet market.

According to a report from the same publication late last year, Asus has set an internal goal for itself of shipping more tablets than netbooks in 2012. That's a tall order, given that Asus has been one of the world's largest netbook makers in recent years.

Google has also set a goal for itself with respect to tablets. Chairman Eric Schmidt said last December that his company would release "a tablet of the highest quality" within six months.

It's not known whether the rumored Google/Asus tablet is the device he was referring to. Some have suggested that the software giant would instead release a flagship tablet in conjunction with its new acquisition, Motorola Mobility.

Google announced on Tuesday that its $12.5 billion purchase of Motorola was finally complete. Motorola, which was one of the first vendors to release an Android tablet with its Xoom device, will operate as a separate business and Android licensee.