Is Facebook building its own phone?

Rumors of a "Facebook phone" are back in the news with a story from the technology Web site AllThingsD, which reports that the social-networking company is working with a cell phone manufacturer to build it.

The rumor of a Facebook phone, or a smartphone with deeply integrated Facebook social-networking tools in it, first emerged a little more than a year ago. Back then, CNET had confirmed the social network had reached out to hardware manufacturers and carriers seeking input on a Facebook-branded phone. But rumors faded as devices with Facebook buttons were announced this year. Now it looks like Facebook may have revised its plans to build its own phone.

On Monday, the AllThingsD Web site reported that Facebook is working with cell phone maker HTC to build a smartphone with the Facebook social-networking technology built into the core of the device. The new phone is code-named "Buffy" after the television show about a vampire slayer. The phone will be based on a modified version of Android, which has been tweaked by Facebook so that its services are deeply integrated, AllThingsD reported, citing unnamed sources.

AllThingsD said that Facebook had also considered Samsung to make the device, but went with HTC instead. HTC has made at least two phones already with dedicated Facebook buttons. The Salsa and ChaCha, which have Facebook buttons, were introduced earlier this year. There are other phone manufacturers that have put Facebook buttons on their phones, including INQ Mobile and Motorola.

But according to AllThingsD, the "Buffy" Facebook phone will be different from these other others devices, because it won't just provide access to Facebook. Instead, it will have the social networking technology developed by the company integrated into the device. Other platforms have done a bit of this already. For example, Microsoft's Windows Phone operating system has Facebook and Twitter integrated into the OS so that contacts are shared across multiple applications on the phone. And previously, Facebook has worked with Research in Motion to integrate Facebook into its BlackBerry devices. It also worked closely with Palm.

There's no question that mobile is an important element of Facebook's strategy for the future. But what the company plans to achieve by building its own devices is not yet known. If it chooses to build its own "Facebook phone," the company faces stiff competition in the smartphone market from players such as Apple's iPhone and Google's Android platform. Each of these platforms also support Facebook apps, so again its unclear what Facebook will do with the integration of its technology into a phone to make it a truly different experience.

Facebook declined to comment for the AllThingsD story and offered the publication this statement:

"Our mobile strategy is simple: We think every mobile device is better if it is deeply social. We're working across the entire mobile industry; with operators, hardware manufacturers, OS providers, and application developers to bring powerful social experiences to more people around the world."

HTC also declined to comment on the story.