Google and Asus are reportedly planning to release a a 7-inch co-branded tablet PC in May, targeting Amazon's Kindle Fire device.

The model will be priced at US$199-249, Digitimes.com reported today citing industry sources in Taiwan.

Asus did not comment on the report.

The device would mark Google's entrance into the tablet PC market, which has been dominated by Apple's iPad high-end devices, with Amazon's low-priced Kindle Fire to gain popularity mainly due to its attactive price.

The new tablet is expected to run on Google's Android OS and also integrate the recently announced Google Play, the company's digital marketplace for mobile applications, music, movies and books.

Among Taiwan-based companies that could potentialy work with Google on the new device (HTC, Acer), Asustek seems to have a lead due to its strong R&D capabilities, the report added.