Like Sony's PSP phone rumors, talk of a new Dell smartphone refuses to die. After the leaked image earlier this month, now the Wall Street Journal is tenuously suggesting that Dell have been experimenting with Android-based prototypes. Two people who have seen the prototypes have described them as "slightly larger than Apple's iPod touch"; however another person has suggested both that Dell may begin shipping the device later in 2009 or "the plan could be delayed or scrapped entirely."
Given that the latter comment was from someone purportedly "briefed on the company's plans", it seems Dell are still very much in the experimental stage. That's not something the company has ever denied; back in May they demonstrated a netbook running Android OS 1.5 Cupcake, though were keen to point out that it was merely a test and not a shipping product.
According to the WSJ, the device is more a MID than it is a smartphone, though Dell are rumored to be considering selling it via carriers in the same manner as 3G-enabled netbooks. It's also believed to be ARM-based, rather than using Intel chips. Other sources tip several Android-based smartphones as still in development and on-course for a release later in the year.