Matt Stone at ASU Web Devil (Arizona State University's online newspaper) has gotten a hold of some internal emails between ASU officials that indicate that they are testing a secret project (referred to as Myworld or sometimes Snow Crash), among strong suggestions that it's for Google and that it's in beta with a small number of students right now.
ASU is something of a poster-child for Google (who even have an office on one of the ASU campuses), and has been an early tester for assorted Google applications.
While there's been a ton of media buzz about Google building a second Second Life, a virtual world (or more likely worlds)- as imagined by Google - is highly unlikely to bear much resemblance to Second Life. It certainly wouldn't fit Google's style of development or deployment. Something more similar to Multiverse, Kaneva (or even Activeworlds) would be far more plausible.
Whatever they're building, it's going to be interesting to see. It's more likely to carve out a new niche though, than to directly compete with existing worlds.
[via ASU Web-Devil]