Even though, the mystery about name and manufacturer of the phone continues, the new phone allows users to be free from their wallet and credit cards. A special chip called, Near Field Communication (NFC), on phone allows users to for their purchases by tapping the phone against a special terminal.
NFC will be integrated with the upcoming mobile operating system Android Gingerbread, which will be launched in Dec, 2010.
"One way to think about it is, this could replace your credit card," Schmidt said at the Web 2.0 conference in San Francisco.
Media reported that the new phone will be named as Google Nexus S or Nexus 2. It is expected to have a AMOLED display with HD powered camera. The new phone may rolled out along with Android 2.3 Gingerbread.