CNET News: Microsoft Chief Executive Steve Ballmer on Thursday dismissed the Android mobile operating system, saying he believed that building it was financially unsound for Google.

Speaking at Telstra’s annual investment day, Ballmer said designing Android wasn’t easy for Google. “They can hire smart guys, hire a lot of people, blah dee blah dee blah, but you know they start out way behind, in a certain sense,” he said.

He questioned Google’s ability to make money with Android. “I don’t really understand their strategy. Maybe somebody else does. If I went to my shareholder meeting, my analyst meeting, and said, ‘hey, we’ve just launched a new product that has no revenue model!’…I’m not sure that my investors would take that very well. But that’s kind of what Google’s telling their investors about Android,” he said.

Ballmer said that although the idea was that Google gives away the operating system and in return gets to put its search on devices for free, he believes that telecommunications operators were smart and would still ask to be paid to carry search.

Android google Steve Ballmer

TrustedReviews: Microsoft CEO Steve Ballmer has picked up where he left off by battering Google Android and revealing future company plans. Sticking it first to the new open source G1 OS Ballmer typically didn’t hold back saying “You’ve got to remember Android is version one….and it looks like version one. They’ve got one handset maker, we’ve got 55. They’re available through one operator, we’ve got 175.”

He has a point but like the rise of the Google search engine its radically different approach to Microsoft could see it build up momentum very quickly. Besides, there’s a big difference between “one handset maker” and “one operator” and the fact other models for different networks simply aren’t out yet.

More constructive however was Ballmer’s admittance that the Zune brand will be incorporated into both Windows Mobile - in a similar vein to how Apple incorporated the iPod brand into the iPhone - and, rather intriguingly, Windows itself. “The Zune software will also be ported to and be more important not just with the hardware but on the PC, on Windows Mobile devices, etc” he explained casually.

Android Microsoft Steve Ballmer Windows Mobile Zune