UPDATED 11:39 EDT / MAY 29 2012

Piecing Together Facebook Mobile: Acquisitions, Rumors, Ads and Android

Since going public, news surrounding Facebook has focused on mobile: how will Facebook roll out its mobile strategy?  How will Facebook justify its recent string of acquisitions, namely Instagram for $1 billion?  How do ads fit into Facebook’s rumored smartphone?  Is Android the right platform for the rival’s play?

No one has an answer to these questions, but they spark ongoing speculation and debate nonetheless.  The latest rumor is that Facebook will take in European mobile browser maker Opera for its ability to dynamically run ads on the mobile web.  We’ve also come across other notions that Facebook would be smart to acquire Millennial Media, the last remaining indie mobile ad network that reportedly couldn’t settle on a deal with RIM.  Alongside Facebook’s series of pre-IPO acquisitions, from Glancee to Karma, it’s clear the social network is picking through the established mobile ecosystem towards something greater.

One thing is for sure–Facebook needs to figure out its ad network and that especially goes for mobile.  What remains to be seen is how Facebook will go about doing so.  The re-surfaced rumors of Facebook launching its own smartphone beg the question, should Facebook bother with making its own hardware?  Many pundits say no.  In fact, the very idea of a dedicated Facebook device seems a silly waste of resources when Facebook already has a presence on every major mobile platform through apps, and now an app store.  And while Facebook’s taken in some hardware engineering talent from none other than Apple, Facebook’s best bet is still an open source mobile platform like Android.

Facebook + Android = how does that work?

Though Google and Facebook aren’t the best of friends, Google’s mobile OS could be the answer for Facebook’s entry into the mobile space.  Android’s been a standing aspect of Facebook’s rumored phone for months now, as HTC is expected to manufacturer the first Facebook-branded phone.  Looking deeper at Facebook’s potential use of Android, it’s necessary for the social network to strip down the mobile OS and develop its own interface with defaults for its native apps.

Of course, a Facebook-branded phone, Android-powered or otherwise, would need to serve as a gateway to Facebook’s ecosystem, which is their true core product.  It’s where their apps platform and ad network stems from, it’s how they appeal to businesses, publishers and marketers alike.  It’s this ecosystem that truly needs to go mobile, and it’s this ecosystem that’s benefitted the most from recent talent buys across the collective of mobile app developer teams Facebook’s recently taken in.

Photo: Businessweek

The most important group to attract to this ecosystem, however, may be Silicon Valley’s VCs.  As Rizzn pointed out, the Valley’s top investors’ loyalty is to be gained with the aggressive Instagram buy, and the potential behind a new kind of Open Graph advertising.  Facebook will maintain developer support by spreading apps through the revamped Open Graph, and VCs are anxious about the possible revenue.  It’s clear the mobile ecosystem at large is only just getting started, and while Apple, Google and Amazon are ahead of the game, Facebook will need to find a way to catch up if it hopes to retain any economic influence in the consumer space.

What about Microsoft’s Windows Phone?

The other obvious option for a Facebook smartphone is Windows Phone, which could still be built by HTC and would make more sense than Android given Facebook’s history with Microsoft.  An investor, search partner and patent supplier, Microsoft has its own vested interest in Facebook’s long term strategy.  Earlier this month it was reported that Microsoft has been courting Facebook for the development of the social network’s pending phone, in hopes of expanding traffic around its own online properties, especially Bing.

Windows 8 may actually turn out to be a worthwhile consideration for Facebook, as it could leverage Microsoft’s plans to connect its devices and software across the board.  As the two are already partners in more than one manner of speaking, it would be easier for Facebook to promote its native apps and services through Windows 8, even beyond the mobile device.

Of course, Microsoft has yet to prove itself a powerhouse as far as mobile operating systems go, barely maintaining its dismal market share compared to the overwhelming dominance of Android and iOS.  But if Facebook’s looking to push its own ecosystem with a smartphone, the originating OS may not matter so much after all.


A message from John Furrier, co-founder of SiliconANGLE:

Your vote of support is important to us and it helps us keep the content FREE.

One click below supports our mission to provide free, deep, and relevant content.  

Join our community on YouTube

Join the community that includes more than 15,000 #CubeAlumni experts, including Amazon.com CEO Andy Jassy, Dell Technologies founder and CEO Michael Dell, Intel CEO Pat Gelsinger, and many more luminaries and experts.

“TheCUBE is an important partner to the industry. You guys really are a part of our events and we really appreciate you coming and I know people appreciate the content you create as well” – Andy Jassy

THANK YOU