Vodafone blog

As media outlets continue to speculate on a possible Facebook smartphone codenamed “Buffy”, Slash Gear weighed in, and came up with a different angle regarding the social network’s possible move.

The article breaks down logically how Facebook could potentially make money from smartphones in comparison to their traditional source of revenue in mobile advertising.

In the article’s example, they’ve used Google’s profit margin for Android (at $9 per unit) and multiplied that amount by the number of devices Facebook expects to sell, in this case using a fraction of the number of units sold from Samsung’s Galaxy S 2 in 2011.

In conclusion, the article states that if the Facebook phone does go on sale it will not sell that well compared to the offerings from established manufacturers like Samsung, Apple, HTC and Nokia.

Given the low margin per device, the amount of resources needed to develop the platform, and the competition from established smartphone manufacturers, do you think Facebook will still go ahead and launch their own smartphone?  

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Source: Slash Gear