A crazy thought: Is Dell toying with Microsoft with its stealthy mobile device project?

That's what I wondered after reading the Wall Street Journal story about Dell developing Android-based devices, including a Web tablet slightly bigger than an iPod Touch and phones that could go on sale later this year. An excerpt:

The development effort is one of the first experiments by a big-name PC maker in a nascent category of products known as mobile Internet devices, or MIDs, which are designed to fill a perceived gap between mobile phones and laptop computers.

You could also call them ultra-mobile PCs, or even Origami devices, after a code name Microsoft used for its early stab at the category in 2006, long before the Google-backed Android operating system surfaced.

Given Dell's relationship with Microsoft and its upcoming Windows 7 push, it doesn't seem too farfetched to imagine that Dell also evaluated some version of Windows for its new devices.

Today's disclosure could put pressure on Microsoft to offer a better deal (although it's hard to beat the price of Android).

If nothing else, the story may give Steve and Michael something to chat about as they haggle over Windows 7 pricing for netbooks and other PCs coming out this fall ...