FACEBOOK HAS REPORTEDLY begun working on its very own branded mobile operating system in an attempt to muscle its way into the burgeoning smartphone market and extend its platform for apps to the mobile sphere.

Ironically, given Facebook’s growing threat to Google’s dominance of the online advertising sector, the Facebook OS is being developed using the open-source Android software – developed by Google – as a base.

TechCrunch reports that Facebook is already in talks with a third party manufacturer who would build a branded Facebook phone, just as HTC did with Google’s aborted Nexus One, customised for the OS.

Using such a base means that Facebook can customise the operating system to embed Facebook’s own social features into an increasing number of applets, while simultaneously making sure that all third-party applications being written for Android could be handled by the new Facebook offshoot.

While Facebook has extensively denied the rumours, a spokesman did not comment when asked if the company would market a Facebook-branded phone.

CNET says it understands that the project is in its early stages, however, and has yet to decide whether the project is to be brought to completion.

The rumours would certainly make sense – as Business Insider points out, one of Facebook’s most popular apps, Farmville, cannot be played on the iPhone or on Android phones; instead, iTunes sells a similar app, ‘We Farm’, for 79c.