Updated: Facebook Places a ‘Game Changer,’ Says Analyst

Facebook is not launching a mobile phone. But it does want to help ignite location-based Web advertising and commerce.

During a press event on Wednesday (Nov. 3), Facebook CEO Mark Zuckerberg bluntly shot down rumors of a Facebook phone with a simple “No.”

According to Zuckerberg, the company already reaches 200 million mobile users across the globe—up from 65 million just a year ago. In short, there is little need to launch a standalone phone when Facebook can develop platforms and applications across numerous devices like the iPhone and various Android phones.

Instead the company is looking to pour its efforts into its recently launched Foursquare knockoff Facebook Places by partnering with various local businesses. Facebook’s mobile application will now allow users to automatically find out about deals at nearby coffee shops, pizza places and bars, which they can redeem by checking in via Places.

The company has signed deals with a slew of big retailers and restaurant chains to participate in the new local deals initiative. Among the participating companies are American Eagle Outfitters, which is offering 20 percent off on certain items for shoppers who check in with Facebook Places; The Gap, which is giving away jeans to 10,000 visitors; and Chipotle, H&M, Macy’s, McDonald’s and Starbucks.

Forrester Research’s social media analyst Augie Ray called this move “a game changer,” predicting that Facebook Places could single-handedly change the way people shop by “encouraging the adoption of check-in activities among people who previously saw no reason to do so,” wrote Ray in a blog post on Wednesday (Nov. 3).

“Since it launched two months ago, consumers have tested Facebook Place’s functionality, but there’s been little benefit to consumers for participating,” Ray wrote. “Facebook is now poised to spark a wave of location-based behavior….As consumers check in using their Facebook application, they can view a selection of nearby offers and immediately act upon them.”

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