latimes.com reports that “Google will unveil its own low-price personal computer or other device that connects to the Internet.”

According to the rumors the machine will not run on Windows, but on an OS developed by Google. Because of this Google will apparently be able to ask for a very low price: a couple of hundred US dollars per machine.

Wal-Mart will — and again we use the word “apparently” — be one of Google’s partners, selling this new “cube”.

The rumor has been around for a while. In September 2005 David Berlind at ZDNet commented that:

“With a bunch of AJAX apps (GMail, Google Suggest, Google Maps, etc) under its belt and with Google already all over the desktop (between solutions like Google Desktop and GoogleTalk) and with another $4 billion in the bank, the company ain’t stopping there. ”

Berlind predicted that Google will launch a network PC, a thin client making use of online services, without all the hazzle of configuring an increasingly complicated Windows PC.

In December Bear Stearns analyst Robert Peck made a similar argument: “In fact, Google could over time become more of a hardware company than anything else,” he noted.

This is “deja vu all over again”. The network PC was one of the popular scenarios predicted before and during the dot com boom, and it never took off.

However, there have been two major developments since then: (1) Broadband is much more common, making the idea of running Internet-based software much more realistic, and (2) it is now possible to make such machines much, much cheaper.

Moreover, it could be that such a box would be part of a larger strategy.

In November Robert X. Cringely speculated that such a Google Box could be used to connect users to new Google data centres put up in all the large cities in the world.

“This embedded device, for which I am afraid I have no name, is a small box covered with many types of ports – USB, RJ-45, RJ-11, analog and digital video, S-video, analog and optical sound, etc. Additional I/O that can’t be seen is WiFi and Bluetooth. This little box is Google’s interface to every computer, TV, and stereo system in your home, as well as linking to home automation and climate control.”

Such a box could also be used for IP telephony, according to Cringley.

We will keep an open mind, but are still not convinced that Google actually will launch such a product, at least not on the short term.

However, the fact that Microsoft has entered the hardware marked with its Xbox game console, proves that we cannot take anything for granted. The new Xbox can also be transformed into such a network home computer, combining the need for Internet access with a game machine and entertainment center.

Apple is clearly thinking along the same lines. Both the Mini and the latest version of the iMac, can be used for such purposes, although those machines are — of course — also full fledged personal computers.

We may know on Friday, when Larry Page, Google’s co-founder and president of products, will give a keynote address at the Consumer Electronics Show in Las Vegas.