Facebook has a network of about 500 million users, and 100 million of them use Facebook apps from Iphone or Android.
As more and more computer users move away from the desktop to smartphones and other mobile devices, this section of the web is becoming a test of which manufacturers can deliver the best combo of hardware, software, and apps for the user.
Free software producers such as Facebook and Google leverage their user traffic by displaying ads to earn revenue. Facebook already does this and has people on its team who helped create software for both Iphone and Android.
In a Techcrunch report it is suggested that Facebook is at work developing software which will be deeply integrated into the Facebook database that no other competitor has access to. The software will run on an Android based smartphone specifically engineered for Facebook.
Facebook has denied they are building a smartphone but the denial was worded in a such a way that it’s still possible the software above is being developed, but because they aren’t actually building the hardware they can deny they are building a smartphone.
It should be remembered that Google denied it was building a smartphone to while it was quietly creating the Android software.
Maybe there’s more than meets the eye here and explains why Apple and Facebook couldn’t agree to provide Apple’s new iPhone4 users direct access to Facebook via an API.