Sep 20, 2010 08:49 GMT  ·  By

Rumors of the Facebook phone were the hot topic of the weekend. Facebook is said to be working on its own branded phone which would integrate the service with the regular features of a mobile phone. While Facebook is denying it, separate reports indicate otherwise.

The rumor surfaced on TechCrunch, which said that a couple of the brightest people over at Facebook were working on a stealthy project and that the project was a Facebook phone.

Joe Hewitt and Matthew Papakipos are working on the project, allegedly, though there are no details on how far along it is. Most likely it is still in the early stages.

Joe Hewitt worked for Mozilla, where he helped create the Firefox browser and then started working on a web-based operating system before the startup was acquired by Facebook.

At Facebook, he is responsible for most of the social network's mobile apps, including the highly praised Facebook iPhone app.

Matthew Papakipos' story is even more interesting. Until very recently, he was heading the Chrome OS project, one of Google's biggest upcoming products.

He unexpectedly quit this summer to join Facebook, before Chrome OS was delivered. Now the rumor is that he did it to work on the Facebook phone.

After the original rumor, Facebook went on the attack issuing a statement that somewhat denied the story and went on say that Facebook is much more interested in building its service into phones. “The story is not accurate. Facebook is not building a phone,” it said.

However, the statement was challenged and labeled as spin as it doesn't flat out deny that Facebook is working on a phone project, just that it's building one.

Facebook is hardly a hardware company so that's not surprising. HTC built the Nexus One for Google, for example. And the initial rumor only said that if Facebook is planning a branded phone which would run its own operating system.

Other rumors have said that the Facebook mobile OS will be based on Android, which is open source. Cnet went on to confirm the rumor from independent sources, after Facebook issues its response.

The device itself will likely be a cheap phone that does Facebook and little else. It won't be a smartphone competitor and it will be priced at a significantly lower point.

That seems in tune with Facebook's mobile strategy so far, especially in developing countries. Facebook Zero, for example, is a version of the site, available for free to users and incurring no data cost, which is offered in partnership with carriers.

Facebook Zero is bare-bones version of the site, but it's more than suited to handle the core tasks on the social network. In developing countries, where mobiles are much more common than PCs and where mobile internet users far outnumber broadband users, this strategy would pay off.

And a dedicated Facebook phone, with all of the aspects of a regular phone getting a social layer, would certainly appeal to a lot of people in developed countries as well, especially for younger people. A simple Facebook phone would fulfill all of their communication needs.