The newspaper reported Sunday that Google has been "exploring the idea of building its own slate, an e-reader that would function like a computer."
The initiative appears to be progressing beyond the conceptual stages, with chief executive Eric Schmidt reportedly talking up the device to his friends during a recent party out in Los Angeles.
According to the second hand comments, the device will exclusively run the search giant's Android operating. Google has reportedly been conducting research under "stealth mode" with a handful of publishers who are helping the company evaluate methods of delivering eBooks, magazines and other content to users through the device.
Since introducing its iPad earlier this month, Apple has gone on to sell more than a half million of the devices even before it's begun shipments of models that will include 3G connectivity in addition to standard WiFi hardware.