10 May 2013

Will Waze Be Facebook’s Next Instagram?

By Mike Isaac at AllThingsD:  
As has been widely reported and according to sources we have confirmed it with, Facebook is indeed in serious talks to buy Waze for $1 billion, the social traffic application that helps drivers navigate the road with crowdsourced traffic information.
While no deal has been struck as yet, these sources said, the discussions are advanced and closely resemble the social networking giant’s lightning-fast purchase of Instagram a year ago.
The similarities do not stop there. The price is the same and is a mix of cash and stock, said sources. In addition, as Facebook has done with Instagram, Waze will be allowed to operate relatively independently within the company if the deal is struck.
Facebook CEO Mark Zuckerberg recently praised the purchase of Instagram, which has grown to more than 100 million active users in a short time span. More importantly, it has been a critical perceptual part of Facebook’s effort to distinguish itself in the mobile space and has added a highly engaged audience to its audience.
The news of the Waze acquisition interest by Facebook was first reported by Israel’s Calcalist. The Israeli-based company has been the subject of numerous rumors of acquisition, including by Apple and Google, neither of which seems to have panned out.
Not so here and the main question now: Why would Facebook buy a mapping company?
It’s not that much of a surprise, actually. The digital industry has moved its focus to mobile over the past few years, as users are increasingly accessing sites through their smartphones instead of desktop sites. As of Facebook’s last earnings, more than 750 million people visit Facebook via mobile device on a monthly basis.
After intense investor worry over its lack of mobile strategy caused a huge drop in its stock, Facebook quickly shifted to the idea that it needed to own the mobile experience. First, as has been reported by AllThingsD.com previously, that was going to be a proper phone. Then, abandoning that effort, the company mulled creating its own operating system. Finally, it settled on Home, essentially a Facebook-ified version of the Google Android mobile operating system that can be downloaded to run on many Android-enabled phones.

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