If dominating the search engine landscape weren’t enough, more rumblings are happening in the digital world about the new Google mobile phone.

Is Google’s entrance into the mobile market (i.e. OS and/or hardware) a foregone conclusion, or another internet rumor?

Since there have been no MNVO papers filed with the FCC or announcements for a mobile hardware partner it would suggest that this little nugget could be chalked up to an overzealous exec looking to cement their place in Internet folklore.

But, if it’s true, it’s unlikely that the major telco’s have anything to worry about. They’re too busy trying to spend money, lay off workers, and satisfy unhappy companies by upgrading their 3g networks.

Yet, it’s not too far of a stretch to see how, if it were true, this fits into a long term strategy of Google untying itself from paid search revenues. Just take a look at their slow but steady diversification of service offerings: Gmail, Blogger, Reader, YouTube, Writely, Urchin, JotSpot…the list is impressive.

In lay-person’s terms, these services roughly translate to: Email, Blogging, RSS, Video, Productivity (Office Apps), Analytics, and Collaboration.

The only one missing from that list? Mobile.

Last time we checked, these were all on the lists of major software vendors as being keys to empowering individuals and/or businesses to be more productive and communicate more effectively. Not only that, but getting them all to work together and play nice (software convergence) is, most of the time, costly, time consuming, and confusing.

And Google’s mission of making information available to everyone fits oh-so-well with the idea of a mobile device or platform.

If the rumors are true the company that has the most to lose is Microsoft. Specifically, the part of Microsoft that is responsible for revenues from small to mid-sized businesses.

SMB’s have long been touted as the backbone of the US economy. But they’ve also long been targeted as a major source of revenue for software companies.

What Google has seemingly understood is that small business owners are also entrepreneurs, and if software costs are chewing in to their bottom line, they’re the group that’s most likely to willingly give something else a try, especially if all they need is communications, email, simple office docs, and a website.

Especially if they can do it all in one place, with one company, at a fraction of the cost of what it would typically cost, and have their critical data available at all times and on all devices.

For now it looks like it’s just a rumor. But since Google has clearly been trying to diversify their revenue, it makes sense that they would add the final piece to the convergence and communications puzzle.