Google Buys Waze for $1.3 Billion

There is a new American dream: develop a small-potatoes app, gain overwhelming popularity by the masses, and then let a major tech company buy your app for a serious chunk of dough. The creators of Instagram were sitting pretty with $1 billion after Facebook picked them up and We Are Hunted was adopted by Twitter last month to build their music service. Waze is the next app to be courted by tech giants, and it looks like Google will pick up the tab this time to the tune of $1.3 billion.

While some acquisitions (like Yahoo buying Tumblr for $1.1 billion) were a monogamous courtship, Waze has had a line of suitors showing interest and considering a buyout. Both Facebook and Apple wanted to buy the app, according to The Guardian, though Apple didn’t stand much of a chance by only offering a paltry $500 million.

Waze describes itself as “the world’s fastest-growing community-based traffic and navigation app,” and lets users pick their icons as they rack up more driving points. It integrates traffic reports with a social element by letting users share their emotions while driving.

googlebuyswazeWaze has managed to break from the pack with its timeliness due to crowd-sourcing. It relies on users sharing pictures of construction, accidents and broken traffic lights. People can upload a picture of how bad the road looks and comment with advice. A status like “Stay off if 1-75, I’ve moved 50 feet in 20 minutes” helps others know how bad it is, while a statement like “Ugh, this traffic is killing me” forms a community with drivers in the same congestion.

The social aspect of Waze works because user statuses either help others or form a bond with people in the same situation. There’s not as much shameless self-promotion as a selfie uploaded to Instagram while stuck on the interstate.

The community element isn’t the only aspect of Waze that has made it popular; it has also grown because of its quick response rate. Waze has local map editors around the US that constantly work to make the app accurate and help drivers find the best route. According to their blog, it took an editor less than a day to program Waze to give drivers an alternate route when the 1-5 bridge collapsed near Seattle. After the tornadoes in Oklahoma, an editor kept the roads labeled for first responders, but provided alternate routes and advised drivers to proceed with caution because of debris. Timelines is critical for Waze because a slow response could mean the accident is cleared before it even shows up on the app.

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It is the combined timeliness and social elements that Apple prized and wanted to harness after its maps debacle last year. The launch of their new maps app was a disaster and Google Maps immediately topped the Free Apps download list within the first day of its launch.

It appears that Google will be sitting pretty with both its successful GPS app and Waze. It gets to be king of the hill for today, but it only takes one critical purchase for Facebook, Apple or (heaven help us) Bing to climb to the top.

About the author

Amanda Dodge