NEW YORK (
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, owner of the world's most popular search engine, was slipping Wednesday after acknowledging that its much publicized pursuit of social mapping startup Waze Inc. had led to a deal reportedly valued as high as $1.3 billion.
Google was falling 0.8% to $872.53 in mid-day trading.
Julien Blin of Infonetics Research Inc. suggested that the deal would draw attention to crowdsourcing mapping systems, such as skobbler GmbH of Berlin, Israeli public-transportation crowdsouced app maker Moovit and London-based Navmii Holdings plc, which has developed an open-source mapping app called Navfree.
"Waze is the one that has gotten the most attention and brand recognition," Blin said.
Google already has a leading mapping application. The purchase will strengthen one area where Google has been weak -- social networking.
Aside from Google Maps, Blin noted, the buyer could leverage Waze with its devices such as Google Glass or the smart watch that is said to be in development. Of course, it could be a match for Google's self-driven car. Blin added that the buyer could have defensive motivations, namely to keep the company from
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Apple, of course, suffered such miscues with its map application that CEO Tim Cook issued a formal apology in September. "With the Apple maps fiasco it would have been a good fit for them," the analyst noted. "Apple has been hiring a lot of former Google Maps executives."
Facebook could have vaulted into the mapping business by making Waze available to its 1 billion users.
UBS portrayed Google's purchase of Waze as part of the "developing battle to control SoLoMo," referring to the combination of social, local and mobile apps, in a recent report. The bank estimates that Waze has grown from 35 million users at the end of 2012, to 50 million users today.
Waze's original backers include BlueRun Ventures, Magma Venture Partners and Vertex Venture Capital. Li Ka-shing's Horizons Ventures and Kleiner Perkins Caufield & Byers joined in 2011, taking part in a $30 million round that helped Waze expand in China.