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Facebook expected to unveil HTC phone with Android software

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By Jessica Guynn
Published:
Los Angeles Times
SAN FRANCISCO -- Get ready for the Facebook phone.
The company is close to unveiling a smartphone whose software keeps the social network front and center. It is part of an overall strategy to advance Facebook's ambitions to dominate mobile devices the way it has desktop computers.
Facebook Inc. has scheduled a news conference Thursday at its Menlo Park, Calif., headquarters to show off an HTC smartphone that operates on software called Facebook Home. The social network's News Feed, messaging, photo uploading and other features will be integrated into the phone, according to reports.
It will be the biggest step yet to re-engineer Facebook into a mobile company. Like Amazon.com Inc., Apple Inc., Google Inc. and Microsoft Corp. before it, Facebook is putting a device into people's hands that is designed to tether them to the service.
"Rather than have Facebook be one of the myriad apps people use on their phones, (it's) trying to elevate Facebook to a higher level," Forrester Research analyst Charles Golvin said. "Whether it's the pictures you share, the messages you send or the conversations you have over voice or video, Facebook wants to be the primary conduit for those connections. You can't do that at the app level."
Facebook is under heavy pressure to capture - and keep - the attention of users who are spending more time than ever on mobile devices so that it can cash in on mobile advertising. And that has forced the giant social network to attempt the most dramatic transformation in its history.
For years Facebook was focused on growing its reach to desktop users, and did not rank its mobile business as a high priority. The company put relatively little effort into applications for Apple's iPhones or iPads, with users frequently complaining that the software was buggy and sluggish.
But soon Facebook could not escape its shortcomings in mobile as newcomers such as Instagram emerged as competitive threats, especially for the attention of younger people.
As the company marched toward its initial public stock offering in May 2012, doubts grew over Facebook's ability to make money from users on mobile devices, dashing its debut as a publicly traded company.
Since then, Facebook has poured considerable resources into building its mobile business. It has deployed hundreds of engineers on coding mobile projects. It rolled out new mobile advertising formats and new mobile apps such as Poke, and overhauled its iPhone and Android apps. Facebook also stepped up its focus on Android, which in recent years has surpassed the iPhone to become the No. 1 operating system for smartphones around the world.
At the end of last year, the number of active daily users accessing Facebook on a mobile device exceeded the number logging on from desktop computers for the first time. More than 650 million of its more than 1 billion users check Facebook from mobile devices - and that number is growing fastest in big markets such as the U.S.
"Today there is no argument: Facebook is a mobile company," co-founder and Chief Executive Mark Zuckerberg said in January.
Speculation about a Facebook phone has circulated in Silicon Valley for years. Zuckerberg has consistently denied reports that his company would get into the hardware business, saying it would be "the wrong strategy." But Facebook left open the possibility of forming deeper ties with handset makers and mobile carriers.
"Facebook's goal is to get its stuff in front of as many people as possible," IDC analyst Karsten Weide said.
The HTC phone is powered by a modified version of Google's Android mobile software. If successful, the HTC phone could be the first of many, analysts said.
"This is a way to get the distribution that they would have gotten through their own smartphone by partnering with somebody else," Weide said.

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