News Column

Facebook's Big Social Network Surprise

Jan. 11, 2013

Tom Hudson

Is it a new online music-sharing service? Maybe video ads? Taking a page from Apple's ability to generate buzz, Facebook on Tuesday holds a media event promising to unveil ... something. The buzz has been enough to fuel a rally in Facebook stock.

Speculation has centered on Facebook launching its own smartphone. After all, when the company sold stock to the public for the first time, it was faulted for being slow to embrace the mobile market. Since then, the company has spent more than a half-billion dollars for cellphone-based photo-sharing service Instagram. One out of five of Facebook's 600 million active users of Facebook's mobile website each month use only their smartphones or tablets to connect to their online friends.

If a Facebook phone is introduced Tuesday, the company would be following the lead of other online service giants selling their own gadgets. Amazon.com has its Kindle. Google puts its name on the Nexus tablet.

Perhaps Facebook has something more playful in mind. The company has had a very successful relationship with Zynga thanks to games like "Words With Friends" and FarmVille 2." Seven percent of Facebook's revenue in the third quarter came from one customer, Zynga. But Facebook is now free to develop its own games instead of having to share sales with Zynga.

For the sake of its shareholders, Facebook would be wise to take another page from the Apple playbook. A mysterious announcement should live up to the hype.

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Source: (c) 2013 The Miami Herald Distributed by Mclatchy-Tribune News Service.