Facebook Unveils "Home," New Mobile Experience

Out next week on some HTC and Samsung phones

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    NEWSLETTERS

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    MENLO PARK, CA - APRIL 04: A Facebook employee holds a phone that is running the new 'Home' program during an event at Facebook headquarters during an event at Facebook headquarters on April 4, 2013 in Menlo Park, California. Facebook CEO Mark Zuckerberg announced a new product for Android called Facebook Home as well as the new HTC First phone that will feature the new software. (Photo by Justin Sullivan/Getty Images)

    Rumors had been swirling for more than a week that the Facebook phone was on the way, but instead CEO Mark Zuckerberg on Thursday unveiled a new mobile experience called Home.

    "Today we're finally gonna talk about that Facebook phone," Zuckerberg told a roomful of journalists assembled at Facebook HQ in Menlo Park, Calif. "Or more accurately, we're gonna talk about how you can transform your Android phone into a great social device."

    Home will be available for download April 12 on select HTC and Samsung phones. Facebook says Home will get monthly updates, but it is not yet prepared to be released for tablets.

    Those "Facebook phone" rumors were apparently the result of HTC piggybacking on the Home announcement by showing off its new phone, First, the first phone to come with Home pre-installed, and designed to leverage the new Facebook experience. The First will run on AT&T's 4G LTE network.

    "A great phone might sell 10 or 20 million units at best," said Zuckerberg. "Our community has more than a billion people in it. We want to build the best experience for every person on every phone."

    "We're not building a phone, and we're not building an operating system... We're calling this Home," said Zuckerberg, before standing aside to show off a gallery of images of the new program at work.

    Home will allow users to monitor Facebook from their Android smartphones' home screens, so they can always be in touch with their friends.

    "Why do we need to go into all the apps in the first place to see what is going on with the people we care about?" Better, Zuckerberg says, is to have that experience come right to the home screen, so you're always knowing what is going on around you.

    Among the new features is Coverfeed, which lets you scroll through updates and post comments; Chathead, a messaging widget; and a notification pane.

    Facebook's stock closed up 82 cents, more than 3 percent, on Thursday following the announcement.

    "What Facebook wants is to put itself at the front of the Android user experience for as many Facebook users as possible and make Facebook more elemental to their customers' experience," said Forrester analyst Charles Golvin.

    The move could help to attract more mobile advertisers. Though mobile ads were a big concern for Facebook's investors even before the company's initial public offering last May, some of the worry has subsided as the company muscles its way into the market.

    Last year, Facebook began showing ads to its mobile audience by shoehorning corporate-sponsored content into users' news feeds, which also include updates from friends and brands they follow. Facebook now faces the challenge of showing people mobile ads without annoying or alienating them.

    The mobile advertising market is growing quickly, thanks in large part to Facebook and Twitter, which also entered the space in 2012. Research firm eMarketer expects U.S. mobile ad spending to grow 77 percent this year to $7.29 billion, from $4.11 billion last year.

    EMarketer said Wednesday that it expects Facebook Inc. to reap $965 million in U.S. mobile ad revenue in 2013. That's about 2.5 times the $391 million in 2012, the first year that Facebook started showing mobile ads.

    Clark Fredricksen, vice president at eMarketer, said it's "tough to speculate" how much effect Thursday's announcement would have on ad revenue.

    At the same time, he says "there are some clear reasons why a deeper integration with mobile operating systems and handsets make sense for Facebook. At the end of the day, the more deeply Facebook can engage consumers, no matter what device or operating system or handset," the better.

    Such deeper integration could mean Facebook is no longer a stand-alone mobile app but part of the operating system's building blocks. For example, if users who want to take a photo would use Facebook's camera app. If they want to chat, they'd use Facebook's chat service. The invitation to the event, "come see our new home on Android," suggests that Facebook will be prominently featured on a phone's home screen.

    Facebook's rival, Google Inc., makes the Android software that Facebook and HTC would be using under the widely speculated scenario. Google makes the software available on an open-source basis, meaning others including rivals are free to adapt it to their needs. Amazon.com Inc. does just that in modifying Android to run its Kindle tablet computers.

    Facebook is No. 2 behind Google Inc. when it comes to mobile ads, and it isn't expected to surpass the online search leader any time soon. Google dominates the mobile search market with 93 percent of U.S. mobile search advertising dollars, according to eMarketer. Online music service Pandora Inc. is in third place when it comes to mobile ad dollars, followed by Twitter.