Facebook is said to be exploring options to purchase a leading mobile navigation service called Waze, based in Israel. The potential purchase price for the navigation service could run as high as $1 billion.
Purchasing the service would allow Facebook to better deliver locally tailored ads and content to the 1.1 billion users of the Facebook site. The purchase could rival what Facebook paid last year to buy mobile photo-sharing service Instagram.
Facebook already has a relationship with Waze. Using their Facebook accounts, Facebook users can log into Waze and share their location data with their Facebook friends. Waze currently has more than 40 million users globally.
Brian Blau, a research director at technology research firm Gartner, said, “These people are giving permission for the cloud to track where they are. This is a particularly difficult problem for social networks in general. Very few people want to be tracked.” This could be a potential gold mine of data for Facebook and its targeted ads.
Facebook has been focusing on trying to increase the amount of time that its users spend on its site and have implemented a number of strategies to achieve this aim. It recently introduced a new interface for Android smartphones called Facebook Home, which about one million users had downloaded to date.
Waze has been talking to potential suitors for months, but nothing has been set yet. Other technology companies may also be interested in a potential acquisition of the start-up to improve their own mobile mapping services. Other bidders could emerge to express interest or a deal may not be reached at all.
The largest technology companies, including Google, Apple and Microsoft, are striving to deliver more location-based advertising and services to consumers. For the companies, mobile maps have become a crucial battleground as consumers rely more heavily on their cellphones for information and services.
