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Facebook working on phones with INQ, sources say

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Facebook Inc is working with mobile-handset manufacturer INQ Mobile Ltd on two smartphones that may be carried by AT&T Inc, three people familiar with the matter said.

The devices, which will feature Facebook social-networking services, are scheduled to be introduced in Europe in the first half of next year and the US in the second half, said one of the people, who asked not to be identified because the plans have not been made public.

AT&T, the second-largest US wireless service provider, is still considering whether to carry the devices and has not done a deal, another of the people said.

Facebook, the world’s most popular social network, is redoub­ling efforts to reach mobile users. About a fourth of the company’s more than 500 million users log on to Facebook from wireless devices. The phones would also present fresh competition to ­Apple Inc’s iPhone and Research In Motion Ltd’s BlackBerry.

“People are increasingly updating their status when they’re on the go,” said Augie Ray, an analyst at Forrester Research Inc in San Francisco. “Facebook is a very popular application on every single smartphone in the country.”

The new phones are expected to run Google Inc’s Android operating system and will probably carry the AT&T brand in the US, according to one of the people.

Facebook has not decided whether its name will be used on the devices, the person said.

While Facebook declined to comment on plans for specific phones, the company said it continues to work with INQ Mobile, which has previously sold phones with Facebook features, along with other companies. London-based INQ, backed by Hong Kong telecommunications carrier Hutchison Whampoa Ltd (和記黃埔), declined to comment.

Li Ka-shing (李嘉誠), the billionaire who serves as chairman of Hutchison Whampoa, has also invested in Facebook.

“We’ve been working with INQ for a couple of years now to help them build a deeply integrated Facebook experience on their devices,” Palo Alto, California-based Facebook said in an e-mailed statement. “While we can’t speak for their future product development plans, we can say that our view is that almost all experiences would be better if they were social.”

One of the new phones is expected to feature a QWERTY-style keyboard and a touch screen, while the other would only have a touch screen and resemble the iPhone, one of the people said.

The devices will go on sale first in Europe, where INQ has closer ties, through Carphone Warehouse Group PLC and several European carriers, said the person, who predicted a release in March or early April next year.

In the US, the phones may carry a price of less than US$100 after AT&T subsidies and could reach stores in July or August, the person said. While Facebook will provide many of the features on the phones, the handsets will also offer other social services, the person said.

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