Report: LG is working with Google on a Nexus smartphone

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LG Electronics is working with Google (NASDAQ:GOOG) on a new smartphone that will be part of the software giant's Nexus program of Android-based devices. The deal could give LG a major boost to its brand and cachet, according to a Bloomberg report.

The report, which cited unnamed sources, said the gadget will be unveiled this month and is based on LG's Optimus G model. The report lends credence to photos and rumors of the device that have appeared in the past few weeks on several technology blogs. Indeed, according to The Verge, LG's rumored Nexus device is listed in UK retailer Carphone Warehouse's inventory system and is labeled as the "LG Nexus 4."

LG and Google declined to comment, according to Bloomberg.

For LG, getting a spot in Google's Nexus program would be a significant win. LG's handset sales have declined over the past year as falling feature phone sales have pushed the company's overall volumes down even as it has moved aggressively to release a line of high-end LTE smartphones under its Optimus brand. According to ABI Research, LG was the No. 5 global handset maker in the second quarter, with 4 percent of the market. LG had been the No. 3 handset maker behind Nokia (NYSE:NOK) and Samsung Electronics.

LG's mobile communications unit--which is dominated by its cell phone business but also houses its network operations--reported second quarter sales of $1.99 billion a decline of 28.5 percent year-over-year. The division also posted an operating loss of $49.6 million.

Google has reportedly decided to expand its Nexus device program to more vendors. HTC made the original Nexus One and Samsung made the Nexus S and Galaxy Nexus. Asustek produced the Nexus 7 tablet, which Google unveiled in June.

By making a Nexus device, LG would be able to raise its profile at a time when it is trying to gain more support from U.S. carriers and bolster its brand. Verizon Wireless (NYSE:VZ) recently launched the LTE-powered LG Intuition "phablet," its first device in the larger-than-a -smartphone-but-smaller-than-a-tablet category. Both AT&T Mobility (NYSE:T) and Sprint Nextel (NYSE:S) will launch the Optimus G, LG's 4.7-inch screen smartphone that sports Qualcomm's (NASDAQ:QCOM) 1.5 GHz Snapdragon S4 Pro quad-core processor. Further, T-Mobile USA said it will launch the Optimus L9, which is part of LG's "L-Series" of phones that run on Android 4.0, and sport a dual-core 1 GHz processor and  4.5-inch display.

"LG's smartphone line-up has improved a lot over the past years," Sophia Kim, an analyst at LIG Investment & Securities, told the Wall Street Journal. "The latest smartphone may help its handset division return to a profit in the fourth quarter of this year."

For more:
- see this Bloomberg article
- see this The Verge article
- see this spearate The Verge article
- see this BGR post
- see this WSJ article (sub. req.)

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