There can be no doubt that one of the hottest startups of the last couple of years has been social sat-nav smartphone app Waze. Not surprising in an era when – largely due to Apple initially dumping Google Maps in iOS 6 – everyone woke up, as if from some slumber, about the importance of decent mobile maps. Something many had taken for granted was thrown into sharp relief, especially when it became clear that even the mighty Apple was capable of royally screwing up its own maps product. So it comes as almost no surprise to us that there are rumours flying around that Apple is sniffing around Waze with a view to a possible acquisition. After all, Waze is already a data partner for Apple’s Maps app and was the only app to gain meaningful marketshare after the Apple Maps fail. We have reached out to both. An apple spokesperson said: “We don’t comment on rumors or speculation.” We got a “we never comment on rumors” from Waze. [UPDATE: Another source confirms that negotiations are advanced, but Waze wants $750M and Apple is willing to do $400M plus $100m in incentives. Waze had less than $1M in revenues last year (primarily from ads). Negotiations may take awhile.]
Last month there was speculation that to help solve its maps issues, Apple had been looking at a Foursquare acquisition. This was based on Apple SVP of Internet Software and Services Eddy Cue sending a single tweet which displayed a Foursquare check-in at Apple’s HQ. At the same time, Foursquare CEO Dennis Crowley was spending a week in San Francisco. Did this imply an acquisition, or a software integration of Foursquare into iOS? It was hard to say.
But based on this tweet, Mat Galligan, CEO of Circa and mobile/location veteran, laid a bet that Apple would buy Foursquare “within 6 months“. However, outside the U.S., Foursquare is not a very big player in terms of location-based data. Certainly in the UK the TechCrunch team here has seen its use fall off a cliff amongst the tech community and there have been scant mainstream retailer deals of the like Foursquare has landed in the US.
By contrast, Waze’s international use has been growing because it is genuinely useful, especially in places where Maps remain a problem, such as in Asia and the Middle East. Because Waze maps are built on the location of moving cars, it’s far more accurate than check-in apps. Outside of Google’s project to map cities with Streetview cars – something which has taken years to complete – and the real-world mapping undertaken by volunteers on the Open Streetmaps open source project, there has been little to match Waze’s approach. Waze turned mapping into not only a game, but also a way for drivers to be social, reporting road obstacles, traffic and police traps. It is properly useful.
It would also cost Apple northwards of $500M+ to buy Foursquare (which has raised $71 million is known to be raising another round), and gain, what? The location of restaurants, bars and airports? Given Waze has raised $67 million, Apple could acquire far better mapping data and a real driving app.
Indeed, Waze has started to ape some of Foursquare’s more useful features. Last year it rolled out a new Foursquare-like product called Waze Ads, a location-guided ad platform for local business owners and big brands that want to attract the attention of nearby drivers.
At the last official count in September, Foursquare claimed to have over 25 million users. But while it’s approached 30 million users, and added Facebook Connect and other features, it’s Waze’s real-world road data that is most important. It’s that kind of data that could prevent people driving straight into a desert after using Apple Maps, for instance.
UPDATE: The media in Israel is also speculating on the rumours.