Meanwhile, Facebook has been expanding its “Nearby” feature, which shows users nearby restaurants that their friends have visited and rated. This technology, if merged with Waze’s crowdsourced network, could create a larger social web that allows users to not only share information about restaurants and attractions, but also about traffic and weather as well. This would suddenly make check-ins seem less arbitrary and more useful, and make it more competitive with review sites such as Yelp Inc (NYSE:YELP).
Anti-competitive tactics
Therefore, by acquiring Waze, Google keeps Apple crippled without a viable alternative to Google Maps and it prevents Facebook from becoming a crowdsourced mapping powerhouse. Those two reasons will likely be perceived as anti-competitive by the FTC, since Google has not only eliminated a potential competitor in Waze, but it has also kept it out of the hands of its competitors. Other mapping competitors are comparably smaller, such as Nokia Corporation (ADR) (NYSE:NOK), which owns NavTeq, and TomTom, which licenses is mapping data to Apple.
Google Inc (NASDAQ:GOOG) is also willing to allow Waze to remain in Israel, a key point of contention between Facebook and Waze that led to the breakdown of their acquisition talks last month. Waze’s CEO Noam Bardin and a small group of employees currently work at its U.S. headquarters in Palo Alto, California, while the rest of his 90 employees are based in Israel.
If Google is actually serious about integrating Waze’s operations into its own, then it should integrate its operations into Google’s own regional offices. Instead, Google’s eager willingness to pay $1.3 billion and its easy compliance with Waze’s requests indicate that it is more interested in keeping the company out of Apple and Facebook’s hands, above all else.
The Foolish bottom line
In the end, Google Inc (NASDAQ:GOOG) has a lot to gain from acquiring Waze, and its competitors have a lot to lose. Not only will Waze’s data make Google Maps a more social driving experience, it could also enhance its localized search capabilities to rival Facebook and Yelp. However, it also has a lot to explain to the FTC, which could end up blocking the deal and giving Apple or Facebook a second chance to acquire it.
I believe that acquiring Waze would definitely strengthen Google’s position in location-based services. Yet it could also lead it down the path of Microsoft Corporation (NASDAQ:MSFT) and eventually be vilified as an anti-competitive bully that believes that it has a Manifest Destiny for controlling the entire Internet.
The article Is Google Becoming the Next Microsoft? originally appeared on Fool.com and is written by Leo Sun.
Leo Sun owns shares of Apple and Facebook. The Motley Fool recommends Apple, Facebook, and Google. The Motley Fool owns shares of Apple, Facebook, Google, and Microsoft. Leo is a member of The Motley Fool Blog Network — entries represent the personal opinion of the blogger and are not formally edited.
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