A Windows-powered Facebook phone?

3 reasons it might happen.

By TheWeek.com May 11, 2012 12:35PM
When rumors that Facebook is secretly building its own smartphone began popping up in 2010, CEO Mark Zuckerberg moved quickly to squelch them.

But a new report from Business Insider, suggests that Facebook is still considering its own dedicated handset, and one of its longstanding business partners, Microsoft (MSFT), is petitioning the social network to make the device run on Windows OS.


Previous reports about the mythical Facebook Phone suggested that the company was planning to run a modified version of Google's (GOOG) Android, similar to Amazon's (AMZN) Kindle Fire. But Microsoft, which owns a stake in Facebook, might actually make more sense for both parties. (Microsoft owns and publishes Top Stocks, an MSN Money site.)


Here are three reasons:


1. They share an enemy. Both Facebook and Microsoft compete against Google, says Emily Parkhurst at TechFlash, and Facebook may be reluctant to pay up for the search giant's open source Android OS. For its part, Microsoft desperately wants to drive mobile traffic to the search engine Bing, says Nicholas Carlson at Business Insider, and steal market share from Google. If Bing becomes the Facebook phone's primary search engine, it could really ding Google.


2. Microsoft has the resources Facebook needs. "Making a phone is not easy," says Carlson. "You have to develop the OS, get manufacturers to build handsets for it, get carriers to carry it, market it, sell it, and ship it." Microsoft has relationships in place across the industry, including with Samsung, Nokia (NOK), HTC (FONE), AT&T (T), and T-Mobile (DTEGY). Facebook has none. Leveraging Microsoft's know-how could prove to be a major selling point.


3. Microsoft really wants more mobile customers. Microsoft's "grandest desire" is deep penetration in mobile, says Emil Protalinski at ZDNet, and getting Windows on a Facebook phone would help the House that Gates built in its quest to surpass Apple (AAPL) and Android.


Sources: TechCrunch, Business Insider, TechFlash, ZDNet


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