Google buying Israeli mobile satellite navigation start-up Waze

Google finally announced yesterday that it is buying Israeli mobile satellite navigation start-up Waze Inc, for an undisclosed sum.

Though the Internet giant did not disclose the purchase price, several reports suggested that the deal was struck at $1.03 billion.

Waze, which has Microsoft among its investors, had earlier been in takeover talks with Facebook and technology giant Apple.

Early last month, Israeli business daily Calcalist had reported that Waze, which had earlier caught the eye of Apple and Microsoft, entered into talks with Facebook about six months ago. (See: Facebook in talks to buy Israeli mobile navigation start-up Waze for $1 bn: report)

It also said that Facebook had signed a term-sheet and was conducting due diligence.

Founded in 2007 by Ehud Shabtai, Uri Amir Shinar and Uri Levine, Waze, which moved its headquarter from Israel to California, is a free user made social GPS application for smartphones.

Waze app is for drivers who use their smartphones to generate maps and traffic data and contribute traffic information to benefit other drivers. It can also report events such as accidents, police traps, or hazards along the way and provide the best real-time routes that bypass traffic, even re-routing drivers as road conditions change.

The application, which holds a 10-per cent market share of the US navigation apps, is currently considered the world's largest navigation app-based social network with 45 million users.

Waze was initially funded by the Blue Run Ventures, Magma Venture Partners and Vertex Venture Capital and recently received additional funding from Kleiner Perkins and Li Ka-shing's Horizon Ventures.

Google, which already has a mapping app, is interested in Waze's technology that add social features, and more importantly, to eeliminate the threat Waze poses to its own popular Maps product, and also to eliminate a competitor like Apple or Facebook from laying their hands on the startup.

Google said in a blogpost that the Waze product development team will remain in Israel and operate separately for now.

''We're excited about the prospect of enhancing Google Maps with some of the traffic update features provided by Waze and enhancing Waze with Google's search capabilities.''

''We'll also work closely with the vibrant Waze community, who are the DNA of this app, to ensure they have what's needed to grow and prosper.''