Google Reportedly Agrees To Buy Waze For Over $1 Billion
The start-up courted by Apple, Facebook and now Google seems to have found its new owner
Several sources have claimed that Google has agreed to buy navigation and mapping start-up Waze for over $1 billion. Under the terms of the alleged deal, Waze will keep its headquarters in Israel and remain relatively independent for the next three years. Meanwhile, Google is expected to use technology developed by the start-up to enhance its own navigation products.
In May, reports in Israeli media claimed that Facebook was looking to buy Waze, and was prepared to spend up to $1 billion. Earlier, it was reported that Apple was in talks to acquire Waze for “nearly half a billion dollars” to improve its own Maps service, but no deal was agreed.
Deal Or No Deal
Waze for Android and iOS is a free app that learns from users’ driving times and patterns to optimise routing and provide real-time traffic updates. It relies on crowdsourcing for map data and other information – users can report accidents, traffic jams, speed traps, police presence and update roads and landmarks. Waze can also help find the cheapest, closest gas station or a parking space.
At the moment Waze has almost 50 million users, and much like Google Maps, the company makes its money through location-based advertising.
According to Israeli news site Globes, the negotiations between Google and Waze, first reported in May, have concluded with a $1.3 billion deal that will see the start-up remain in Israel for the next three years and maintain a degree of independence.
Forbes reported that the deal with Facebook fell apart because the social network wanted to relocate Waze to San Francisco. Unlike Facebook, Google has local offices in Israel.
Google could be looking at Waze as the means to improve its popular Maps navigation service and make it more useful to drivers, while at the same time getting its hands on thousands of terabytes of valuable data. The acquisition would also mean Google’s competitors will not be able to use the technology to challenge its dominant position in the navigation software market.
“As Ovum’s Location Platform Scorecard reveals, Google already has a market leading location platform but it is clearly not ready to rest on its laurels. Acquiring Waze is further evidence that the company feels the need to deepen its mapping and location services functionality still further and Waze’s functionality would certainly help it achieve that, as it would have Google’s rivals,” commented Tony Cripps, principal analyst at Ovum.
“Waze also has the benefit of being somewhat popular in the Apple ecosystem and of having a strong community element to it, something Google still struggles with. Leveraged sensibly this functionality could well strengthen Google’s broader social strategy in terms of Google+, which is gradually gaining momentum through its stealthy implementation,” he added.
The deal could be announced in the next few days, but it would still be subject to approval of US regulators.
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