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Samsung has decided to use Android (s goog) and its success with the Galaxy franchise to take on Apple’s iPod touch with a music playing app device that, like Apple’s product, offers the mobile web, apps, navigation and media playback, but no cellular voice. An updated device — the Samsung Galaxy Player — will reportedly be shown off at the Consumer Electronics Show (CES) says the Samsung Hub blog. Unlike the currently available Galaxy Player 50, an early attempt at an iPod touch competitor using Android, the hardware specs of the new Player look to compare extremely well to Apple’s (s aapl) current iPod touch, now in its fourth product generation.

See for yourself with the reported features: There’s no “retina display,” but there is a 4-inch touchscreen with 800 x 480 resolution, front and rear-facing cameras, integrated GPS, Wi-Fi and Bluetooth, and a Samsung 1 GHz processor, most likely the Hummingbird found in Samsung’s Galaxy S handsets. Indeed, looking both at the feature-set and at Samsung’s successful “one size fits all” approach with its Galaxy line of smartphones, the new Player shouldn’t really surprise. Samsung is on track to sell 10 million Galaxy handsets, and the similar Player will likely appeal to those who crave a high-end Android device but don’t want a monthly voice or data bill.

Interesting to me is that the Player is expected to have access to the official Android Market, which I think is integral to the success of any Android handheld. Back in April, I said Google was missing a huge opportunity on non-smartphones because it wasn’t allowing Market access to such devices. Google is clearly easing up on the hardware restrictions because it wants Android everywhere. Although smartphone sales continue to increase at a torrid pace, there’s plenty of potential for Android devices that don’t offer voice or cellular data services. My new Galaxy Tab is a perfect example, because the voice capability is disabled. That’s fine (although I may hack it to get voice working) but I’m very dependent on the device’s Android Market access, else I’m stuck with the apps that Samsung includes. Market access opens up the possibilities to fun apps such as Angry Birds and useful utilities and productivity software.

It’s also worth noting that Samsung’s chip battle is likely stoking the fire in a competition with Apple. Prior to Apple’s design of the A4, chip which powers the current iPhone, iPad and iPod touch, the company used Samsung application processors in its mobile devices. With Apple’s A4 chip arriving last year, Apple has no need for Samsung processors, including the current Hummingbird and future dual-core Orion chip. Samsung already has a solid iPhone competitor in its Galaxy S, so why not use that design — and the chip that powers it — to take a stab at Apple’s iPod touch?

I’m happy enough with my 7-inch Galaxy Tab; even though it’s larger than a phone, it’s still small enough to take everywhere. So at this point, I’m not interested in an Android-powered “iPod” device. But I’m betting some of you are, provided you can live without iTunes to sync music. For that, I recommend DoubleTwist, which supports Android devices and a multitude of others. How about it? Is anyone interested in an Android device without phone capabilities, if the price is right? Even better: What might happen to demand for the Galaxy Player if Google ever adds VoIP to phone capability to Google Chat like it has for the desktop client?

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