Facebook unveils new smartphone ‘Home’
Social network puts new ‘skin’ on Android smartphone from HTC
By Dan Gallagher, MarketWatch
MENLO PARK (MarketWatch) — Facebook Inc. unveiled a new user interface for mobile phones on Thursday, along with a new smartphone from HTC designed to showcase the software.
The new software, called Home, is designed to make the social network a more central part of the mobile phone experience. Facebook FB +3.13% has seen a significant number of its users shift to mobile devices from desktop PCs over the last two years, but ads over mobile platforms don’t yet bring in the same level of revenues as more traditional Web advertising.
The company showed off the new software at a media event at its Menlo Park, Calif.-based headquarters on Thursday.
Facebook Home is designed to replace the traditional home screen on an Android-powered smartphone, in a way that makes updates and feeds from the users’ social network accessible without having to open specific aps. Home will be available for loading onto a limited number of Android smartphones from HTC and Samsung on April 12.
HTC also announced the HTC First, a smartphone that will be the only device to come preloaded with the software. That phone will go on sale exclusively at AT&T T +1.69% on April 12 for $99 with a two-year contract.
Facebook shares were trading up more than 3% to $27.03 following the event. The stock has come down more than 15% since its last earnings report on Jan. 30, but remains well above its post-IPO slump that put the stock below the $20 level for much of last fall.
At the event, CEO Mark Zuckerberg said the company was looking to build “the best experience for everyone on every phone. He has previously discounted frequent rumors that Facebook would build its own phone, pointing out that the company’s greater interest lies in making its service accessible and usable across all mobile devices.
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Facebook shows off the initial Android phones from HTC and Samsung that will be able to load the Home software.
“We wanted this to feel like system software and not just an app that you run,” Zuckerberg said at the event.
Home will be limited to devices running on the Android mobile operating system from Google GOOG -1.38% as that system is more open to allowing developers such as Facebook to introduce their own tweaks. The company did not announce plans to add the software to rival platforms such as iOS from Apple AAPL -0.99% , Windows Phone from Microsoft MSFT +0.12% and BlackBerry BBRY -0.27%
Home replaces the traditional Android home screen with a new look that brings updates from the user’s social network directly to the screen. It also includes a tool called “chat heads” that allows instant messaging to be conducted no matter what apps are currently in use.
Ken Sena of Evercore Partners said Home was a “clear net positive” for Facebook, which he rates as equal-weight — or neutral — with a $32 price target.
“It does seem like this lets them get one layer closer to the consumer ,” Sena told MarketWatch, adding that it will likely also help them build “more value-added services in the long term,” including its advertising business.
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New ‘Facebook Home’ demo
Emphasizing a “content first” approach to their new family of apps, Facebook’s Director of Product Adam Mosseri walks through the Coverfeed experience for Facebook “Home.”
But not every user may want the experience, according to Forrester analyst Charles Golvin, who said that while Facebook “clearly wants to be at the center of its members’ experience, I don’t think that desire is mutual.”
“Consumers are more likely to prefer their Facebook feed remain separated from other communications than see their world through a blue Facebook lens,” he told MarketWatch, adding that the design of Home represents a bet that the future world of e-commerce will be driven by social, rather than search.
“Even if that’s true — which is debatable — such a change in consumer behavior will take a long time to obtain,” he added.
For HTC TW:2498 +1.44% , a partnership with Facebook offers a way to differentiate some of its products against bruising competition with Samsung KR:005930 -0.07% , which has taken the lion’s share of the Android market. HTC is also launching the HTC One later this month as a high-end smartphone offering designed to compete with Samsung’s Galaxy S4, likely coming out in early May, as well as the next iPhone from Apple Inc. AAPL -0.99%
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