Earlier this year we shared a news story about Waze, the navigation app that crowdsources traffic information, and how users of the app had collectively contributed millions of traffic reports to the service.
Waze is in the news again this week, but now as part of rumors that the startup will be acquired by Facebook. VentureBeat, citing an Israeli news site with a reputation for accurately breaking news about acquisitions, suggests Waze could be had for a price tag nearing $1 billion, which is what Facebook paid last year for Instagram.
As VentureBeat discusses, the question people might ask is ‘What does Facebook need a GPS navigation app for?’ Devindra Hardawar, the author of the article, speculates that the play would be about giving Facebook more “screen time” on your phone. Waze users (I myself am a heavy user) constantly have the app open and are taking a look at it while driving around town. Occasionally, advertisements for nearby establishments will pop up on the app, and this could be a powerful new advertising mechanism for Facebook.
On top of all that, if a users’ Waze account were linked to their Facebook account, Facebook could start collecting a much more granular level of geographical information about where their users are located and where they go. It’s not hard to think about all the advertising possibilities that Facebook could offer through the app. Imagine, for example, if a user put into Waze that they wanted to go to Joe’s Crab Shack. They’d be using the app to navigate to that restaurant, but perhaps Red Lobster, purchasing ads through Facebook, could have an offer for Red Lobster pop up instead and have Waze ask the user if they want to re-route to Red Lobster and get a coupon for 25 percent off their meal as a result. From a business perspective, it seems acquiring a company like Waze might bring a tremendous opportunity for Facebook, but of course, nothing is official yet and the acquisition is just rumored.