Internet search giant Google, Inc. (GOOG) is considering a bid for Israeli GPS navigation app maker Waze, Inc. that will set up a bidding war with Social networking giant Facebook, Inc. (FB), according to a Bloomberg report on Thursday.
Google, which recently overhauled its Google Maps, is now looking to add a new real-time navigation service to its portfolio through the acquisition of Waze.
Facebook was already reported two weeks ago to be in discussions to acquire Waze for between $800 million and $1 billion. Facebook is currently doing due diligence on the deal. However, Waze is said to be looking for bids in excess of $1 billion and is fielding expressions of interest from multiple parties.
At these prices, the purchase of Waze will be the biggest for Facebook since it acquired mobile photo-sharing service Instagram last year for $700 million. It will also be Facebook's third acquisition in Israel after it bought mobile application platform Snaptu for $70 million in 2011, and face recognition firm Face.com for $60 million in 2012.
Facebook was looking to buy Waze to compete better with the likes of Google and Apple, Inc. (AAPL) as more and more of its users turn to smartphones for access.
However, Google is now looking to launch a rival bid for Waze and Apple is already rumored to have offered $400 million for Waze few months ago. The deal reportedly fell through as Apple was not ready to raise the offer. Apple is currently using some Waze data in its iOS 6 Maps service, which users complained about being inaccurate immediately after it launch.
At a time when Apple was facing users wrath related to its iOS 6 Maps service, Apple CEO Tim Cook had recommended Waze as an alternative to Apple Maps, along with others such as Bing, MapQuest, Google Maps or Nokia maps.
Waze is consistently one of the top downloads at Apple's App Store and Google Play, the store for Android phones.
Waze is the world's fastest-growing community-based traffic and navigation app. It is a free social GPS application featuring turn-by-turn navigation, developed by the Israeli start-up Waze Mobile for GPS-enabled smartphones with a data plan.
Waze won the Best Overall Mobile App award at the 2013 Mobile World Congress, and was also named Best Connected Product of the 2013 Webby Awards on Tuesday.
Waze was founded in 2008 in Israel by Uri Levine, software engineer Ehud Shabtai, and Amir Shinar. The company was originally called Linqmap.
Waze generates traffic data and maps using satellite signals from the smartphones of its members. This is shared with other members, thus providing real-time traffic info. Waze has 47 million users. The company has so far raised $67 million in funding, including from chipmaker Qualcomm Inc., Kleiner Perkins Caufield & Byers and Blue Run Ventures.
GOOG closed Thursday's regular trading session at $882.79, down $6.63 or 0.75% on a volume of 2.28 million shares.
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