The negotiations for the hardware partners are said to have started all the way back in 2007. Apparently, LG was in for a while and then decided to opt out of the partnership in the middle of 2007. Google then turned to HTC, which at the time was relatively unknown to many smartphone users. HTC stepped in and the rest is history. HTC is now the maker of some of the most popular Android smartphones around.
Why LG opted out of the Android deal is unknown. There is some speculation that considering LG was working on the all-touch Prada phone about the same time the first iPhone came out perhaps LG wanted to focus on its own hardware thinking it would be successful. The thunderous adoption of the iPhone proved that bet to be a bad one for LG.
[via SlashGear]
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