I've heard _rumors_ of a Google device. But the only concrete stuff I've come across, attached to the "google phone" concept, is specs/software/services that other devices could leverage. I haven't seen anything concrete about a physical device coming from Google.

I actually think it'd be a mistake for Google to make a device. But having a set of software every vendor can use, that also enables their "free via advertising" scheme (with some of that revenue going back to the carrier and the device maker), makes a lot of sense for them.