Mar 14, 2011 15:41 GMT  ·  By

Facebook is gearing up to enter the daily deals business and may start offering discounted deals that compete with the likes of Groupon and LivingSocial. Facebook's product will only be available in a few cities at first and is an expansion of the existing Deals, but the social network is in a great position to make a splash in the market.

According to Bloomberg, the new deals product will launch in San Francisco, San Diego, Dallas, Atlanta and Austin for now. Later, the product will be launched in other locations.

"Local businesses will be able to sign up to use this feature soon, and people will be able to find Deals in the coming weeks," Facebook said in a statement confirming the new feature.

There aren't that many details on what Facebook's daily deals product will be like. Apparently, Facebook will work more to promote existing deals and encourage users to share them to attract a wider audience.

Facebook already offers a way for local businesses to advertise themselves via special offers. With Deals, they can offer Facebook users discounts and other promotions.

Deals is integrated with Places, Facebook's check-in location service. So far the focus with Deals has been on the mobile space, users find new offers and deals from places nearby.

However, it looks like Facebook may be expanding that and making the offers more widely known to users in a city, regardless if they actually are near the place or not.

Groupon has been making a killing with its deep discounts and offers and has expanded in tens of countries. But it's still way behind Facebook in terms of users and thus audience it can reach.

Daily deals via Facebook would create big opportunities for any business which will be able to reach the big number of users Facebook has in most cities around the world.