The Craze for Waze

Wed 29 May 2013 14:05, Seema Sanghavi

What was once a mobile app only in Israel, is now a global mapping marvel. On top of all this world wide recognition, Waze has now attracted the interest of Facebook and Google. But exactly does Waze do? This free app plans on helping people solve an everyday problem, traffic. But why the interest from Facebook and Google? Both companies seem to have their own reasons for battling it out and preparing to spend around $1 billion for the app. 

The Craze for Waze

According to Bloomberg, Waze is growing popularity around the world. With a current user base of 47 million, 11 million are from the USA and 10 million are from Europe. Available on both the iPhone and Android, the app is free and present in 193 countries. Drivers like using Waze since it provides extra information on top of the standard digital maps. The app provides information such as upcoming road work, accidents and speed traps so drivers can avoid certain areas and be rerouted.

So how exactly does Waze work? The app gathers real-time traffic information from crowdsourcing. The idea is that as a user, you can check into Waze if you see any traffic stoppers and anyone else can see your note and avoid the area. Waze also collects data if you leave the app open on your smartphone. The app tracks your location and speed to see how well traffic is moving where you are. Waze uses the same business model as Google and Facebook, advertising. According to Social Media Today, if the business model holds up, either Facebook or Google could drastically gain from the acquisition given the apps real-time traffic information and geo-targeted advertising. There’s also the option of gamification that can be added with reviews, badges and sharing with friends. If done right, according to the article, Waze would eventually beat out Foursquare in location-based check ins and specials deals. No matter who ends up owing Waze, the purchase could skyrocket the app's organic growth faster than it could on its own. Since the content is user generated, the more users the app has the better the content.


According to Pocket Now, one downside of the Waze app is the fact that it is free. The article points out that due to the lack of price, users must get used to the in-app advertisements and location-based promotions. However, the author states that if Google purchases the app, many of the app’s features will disappear and if Facebook takes over, the social media giant will try to become the app user’s address book, instant messenger, SMS client, social wall and their navigation platform and this would be too much information for one company to have. The author predicts that many Waze users would uninstall the app and wait for another similar app to rise.

Regardless of what stands in the future for Waze, I’m sure there will be pros and cons for the app no matter who wins the acquisition battle. I agree with the fact that some users may be turned off by an acquisition by either Google or Facebook but the truth is both companies can also bring along a large user base with its purchase. What will be interesting to see is what the losing company does to counter the effects of another giant owning Waze. Perhaps they will create their own competitor app? What’s your take on this? 








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