Facebook is to unveil a new daily discount deals service, similar to Groupon, that will provide its 500 million members with the opportunity to purchase products or services at significantly reduced prices.

Bloomberg reports that Facebook will initially offer deals in San Francisco, San Diego, Dallas, Atlanta, and Austin, Texas, working with local businesses to highlight deals to users in specific areas and allow them to share them with their friends.

Facebook has confirmed reports, noting that the new deal service will launch in within weeks:

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.

By entering the daily deals space, Facebook will be able to leverage its massive userbase to provide very real competition to Groupon and other rival services that have had to build their communities from scratch. With Facebook Places Deals already live in North America and selected countries across Europe, users will already be familiar with location-based promotions and coupons.

Facebook has also partnered with third-party services, providing users with discount offers from companies including ReachLocal, Gilt City, Tippr, HomeRun.com, PopSugar City, KGB Deals, Plum District and Zozi.