According to a story published on Bloomberg, because of the ongoing economic crisis Google employees will only receive a T-Mobile G1 smartphone instead of their usual cash bonus.

The source, who asked not to be identified, said that according to information in his possession 85 percent of Google workers will get the device, while last year the company handed out $1,000 cash gifts to most employees, with bonuses in excess of $20,000 not being unheard of.

The phones will be given to employees unlocked and without a SIM card. They'll also be customized with a "droid" drawing on the back. According to the source, the company joked in their Christmas email that it's a great chance for them to get employees — over 20,000, plus 10,000 contractors — to test the product.

"Some of you will of course be wondering why we decided to change from a cash bonus to the Dream phone," the email reads. "First, we've never developed anything like the Android software before and this represented a unique opportunity to celebrate that achievement. Googlers globally have been asking for the Dream phone and we're looking forward to seeing all the different things that you do with them. [...] Second, as we discussed in our email this week, the current economic crisis requires us to be more conservative about how we spend our money."

The term "we eat our own dog food" is a phrase used at Google to describe the company practice to test its own products in-house in order to improve the brand awareness, get free testing and user feedback, or simply to show faith in the products it produces while maintaining a certain level of discretion before actually releasing a product to the publi

c.

The phones, which the company said could not be resold for any reason — not even by those who already owned a G1 — were handed out starting from December 19th. Google staff in countries where the G1 is not yet supported, such as Russia and China, will receive a cash bonus amounting to about $400 for their December paycheck.

As some have noted, this mass stock clearout might lend a little more credibility to the rumours saying that a second Android-powered G2 is going to hit the US markets sooner rather than later, with January 26th being the expected launch date for Samsung and T-Mobile's next Android-powered smartphone. Kogan Technologies's "Agora" will also be powered by Android and is due to hit the Australian market on Jan 29.

But Google's latest decision, which is currently making headlines all around the Web, is mainly just one of the many steps the company has undertaken in recent times to drastically reduce its spending and control its finances in a more effective way.

Lately, Google has decided to cut on the free meals offered to its employees, as well as other benefits. As previously announced, a good portion of the contractors working for the company has been quietly laid off — estimates say that as many as 3,000 contract positions, or ten percent of the company's working force, were affected.

Along with its cost-cutting efforts, the company also seems to be desperately trying to keep its advertising revenue figures stable by introducing ads in many of its products, the latest of which was the "Search Suggest" service that yields query suggestions based on their popularity. The intervention wasn't however welcomed by advertisers, who complained that the ad positioniong — at the top of the list — made it easier for Web users to generate false positives.