Facebook logos on a computer screen are seen in this photo illustration
Credits: REUTERS/Valentin Flauraud
Citing anonymous sources, some of them Facebook employees, the newspaper claims the social networking giant has hired more than half a dozen former Apple engineers who worked on the iPhone and one who worked on the iPad to help develop the device.
"(CEO) Mark (Zuckerberg) is worried that if he doesn't create a mobile phone in the near future that Facebook will simply become an app on other mobile platforms," a Facebook employee told the paper.
Sources said this is the company's third attempt at getting into the smartphone market, but previous projects crumbled.
The phone now in the works has reportedly been codenamed "Buffy."
When contacted for comment, Facebook neither confirmed nor denied Buffy's existence, saying only: "We're working across the entire mobile industry; with operators, hardware manufacturers, OS providers, and application developers."