Making its own mobile phone could help Facebook boost revenue, something investors are demanding after a disappointing IPO.
Facebook has five mobile apps, no clear way to monetize its mobile users, and it is now looking to build a smartphone, according to a recent New York Times report.
Yes, we’ve heard this all before. This the the third time the socialnetwork has been reportedly working on a smartphone to rival Apple andGoogle, which would arrive in consumers’ hands some time next year.But, this is the first time the rumor start making sense givenFacebook’s post-IPO pressures tomake money and 900 million user base.
To refresh your memory, the first time we’ve heard of the Facebookphone was in 2010 from TechCrunch, and the second time in 2011 fromAllThingsD on the partnership between the social network and HTC.Facebook denied the rumors on both occasions and the onlyFacebook-enabled phones from the manufacturer were two HTC Androiddevices featuring some software and hardware integration with thesocial network.
According to the Times report, Facebook’s first two attempts at makinga smartphone were real, and not just rumors, but the phone neverarrived because the social network underestimated the difficulty ofbuilding a smartphone. The third time is different, though: Facebok hashired some half a dozen former Apple software and hardware engineerswho worked on the iPhone and iPad to help.
With some 700 million users worldwide, Facebook is probably close toreaching its peak. While the social network uses several kinds oftargeted ads to make money, it hasdifficulties monetizing some 200million users who use Facebook from their mobiles.
That’s not to say Facebook doesn’t have a strong mobile presence. Onthe iPhone alone the social network has four different apps: anall-encompassing app among the most downloaded in the App Store’shistory (also on Android), a Messenger app (also on Android), a fanpage management app, and the latest addition is Facebook Camera, an appsimilar to Instagram (also on Android), which the social network boughtthis year for $1billion too.
Largest online phone book
Facebook even has its own app store, however, it is missing a keyfeature on the iPhone, which is native iOS integration. In contrast,iOS users can tweet from most apps of the OS directly, and uploadphotos to the network, while Facebook has not gained such privilegesfrom Apple.
Facebook’s mobile apps are perhapsan indication of what core featuresa phone from the social network would focus on, but it’s unclear whatOS it would run. Earlier speculation indicates it would be a modifiedversion of Android — similar to the Kindle Fire. But the question is,if Facebook is working for some two years on an Android smartphone, whydoes it have only two apps on Google Play, while on the iPhone it hasdouble that?
As my colleague Sarah Jacobsson Purewal pointed out earlier this month:There are many ways Facebook could utilize its 901 million user globalnetwork to its advantage. “It could create the world’s largest onlinephone book — suddenly the idea of a Facebook phone doesn’t seem socrazy after all.”