By Malathi Nayak and Alexei Oreskovic

SAN FRANCISCO (Reuters) - Google Inc's "Nexus 7" tablet is off to an encouraging start, with major retailers running out of the gadgets as the Internet company's first entry in an increasingly crowded market showed up in U.S. stores on Friday.

GameStop said on Friday it had already run through its first two allocations of the tablet, co-developed by Google and Taiwan's Asustek that starts at $199 and has drawn glowing reviews from major gadget reviewers.

Sam's Club, the warehouse chain owned by Wal-Mart Stores Inc, and Staples listed the device as being out of stock on their websites as of Friday. Office Depot's website continued to offer the device for sale as of the afternoon.

Google unveiled the 7-inch tablet, which the company hopes will allow it to better compete against Apple Inc and Amazon.com Inc and funnel more people into its trove of online content, at its annual developer conference in San Francisco at the end of June.

Consumers have been able to pre-order the tablet from Google and several retailers in past weeks, and Google said it began shipping devices to consumers on Friday.

"We blew through the first two allotments," a GameStop spokesperson said.

A third allotment of preorders will be available in August. The game retailer declined to share exact number of preorders.

The Nexus 7 uses Google's Android mobile software, which has become the most prevalent operating system for smartphones globally, but has so far failed to make a big splash in the tablet market.

By taking a greater role in the tablet arena, Google hopes to ensure that its online services remain front-and-center to consumers, as tablets by Apple and Amazon are increasingly becoming gateways to the Web and Web-based content such as movies and music. Continued...