FaceFone?

Here's an interesting rumor spreading through the internets: Facebook is reportedly working on making a "highly-integrated" cellphone that would carry the Facebook name.  Similar to Google's G1 cellphone, Facebook would write the software for the device and contract a third party to construct the gadget.

This is an interesting example of Economies of Scope.  Economies of scope basically means that as a company becomes adept at making one product, it can use the technologies and resources it has developed to make that one product to expand into different industries.  Facebook is good at writing social networking programs, so it can easily use this know-how to program a cell phone that will allow people to poke their buddies, strangers, and stalk their old high school friends anywhere, anytime.

I've asked many college students what they think about the FaceFone, as I like to call it.  So far, no one has said they would be interested in the least bit in buying the phone. "I've already got a Facebook app on my phone, why do I need a whole new cellphone?" is the common response.  Maybe Facebook will be able to differentiate this phone from the way the applications work enough to attract buyers, maybe not. Only the market will tell.

-Brandon