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Facebook Is Building The Facebook Phone Right In Front Of Our Eyes

One of the many points of intrigue around Facebook's future centers on the mobile phone market.  —  It has been reportedly working on a mobile operating system for its own phone since 2010.

Business Insider Jay Yarow

Context & Ripple Effects

Reports of a Facebook handset effort have circulated since the first phone-building reports in 2010, while Facebook's mobile chief set a one-to-two-year goal of becoming a mobile company in 2011. A separate 2011 report identified the effort as “Buffy,” making the latest account part of a recurring push rather than a new strategic direction.

The important distinction is execution: Facebook is confirmed to be making another smartphone attempt, but its reported work on an operating system remains unconfirmed. That leaves the company’s degree of control over the device stack unresolved.

First-order effects

  • Facebook’s mobile team is tasked with turning its stated mobile-company ambition into a device effort, extending responsibility beyond the social service itself.
  • The unconfirmed operating-system component means Facebook has not established a new software platform for developers or handset partners.

Second-order effects

  • A Facebook-controlled handset would put Facebook’s mobile experience under its own product decisions rather than leaving its distribution entirely to existing smartphones and operating systems.
  • The recurring reports raise the strategic cost of Facebook remaining only an application on other companies’ mobile platforms, even before the operating-system claim is verified.

Third-order effects

  • If Facebook secures meaningful control over hardware or system software, social networks may compete for the mobile access point itself rather than only for time inside an app.
  • The pattern points toward consumer internet companies seeking tighter control of the device experience when mobile distribution becomes central to their business.

The trend: Facebook’s phone effort is one instance of internet platforms moving from software services toward greater control of mobile distribution.