Google wins bidding war to by map app Waze?

11/06/2013

Google is to buy social mapping app Waze for around $1.3bn, after an intense bidding war with rival Facebook, according to news reports.

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According to Israeli newspaper Ha'aretz, the deal will be worth $1.3bn. The paper reports that the deal hasn't been finalised, but Google agreed not to lay off Waze workers at its development centre in Israel, and will allow the company to continue its development in Israel "for at least three years."

According to the report, the conditions of the deal will keep Waze CEO Noam Bardin at the helm of the company, and Waze will retain its brand and won't be integrated into Google.

The crowd-sourced navigation device app passively tracks the routes of its users via GPS, something already done by Apple and Google traffic apps. But Waze goes further with many volunteers who improve its maps, similar to the way volunteers add content to Wikipedia.

Google is already the leader in online mapping, and its purchase of Waze might keep competitors from nipping at its heels.

A deal for the iPhone app has been in the works for a few months, with the bidding for Waze reportedly involving Facebook and Google.

Apple was also rumored to be considering a bid for Waze earlier this year, but on May 28, Apple CEO Tim Cook denied that Apple made a bid for Waze.

Commenting on the news, Tony Cripps, principal analyst at Ovum said: “Confirmation that Google is buying mapping start-up Waze for $1.3 billion will come as no surprise given that the Israel-based company has been separately linked to Google, Facebook and Apple recently and is indicative of the strategic importance that location and mapping have for the consumer technology giants. It also quashes speculation that this industry buzz was more the creation of Waze’s PR department than of genuine interest in the company.

'Strong community element attractive to Google'

“If confirmed this is as much an offensive as a defensive move by Google. As such it needs to be understood in light of the whole of Google and its overall business objectives, not just the parts. 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.

“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.”

Read the the Ha'aretz report here

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