Waze, the navigation app owned by Alphabet's (GOOGL) Google unit, is quietly transforming into a ride-sharing service that could eventually rival the likes of Uber and Lyft.
The Wall Street Journal reports that the internet giant plans to make Waze's carpool service available in several U.S. cities and Latin America in the coming months, marking a massive expansion of the app that uses crowdsourced data to give real-time traffic and navigation information. It's unclear which cities the carpool service will be launched in.
"We look forward to potentially bringing Carpool to additional cities in the future," said Josh Fried, Waze Carpool's head of business development, in a statement. Fried declined to comment on any additional plans.
Waze carpool encourages regular drivers to pick up other users along their route and is, in most cases, several dollars cheaper than Uber or Lyft. Google decided to expand the carpooling service after it was piloted in Israel and San Francisco last February and received positive results, according to the Journal.
Google bought Waze for about $1 billion in 2013 and the service has since grown to 75 million users, up from the approximately 45 million users it had four years ago. Google has looked to utilize Waymo's vast user data that provides "incredibly accurate," up-to-date maps as a way of building out its other services, said Bob O'Donnell, president of market research firm TECHnalysis Research.
The user data from Waze has the potential to push Google to the forefront of autonomous driving technology, which it has been exploring through its Waymo self-driving car unit.
One of the biggest challenges to developing autonomous driving is having accurate road, traffic and other geographic information, O'Donnell said. Waze provides a wealth of dynamic information, such as where a pot hole might be located, that could potentially be used as a base for its autonomous driving technology.
"That kind of stuff is critical to autonomous driving," O'Donnell said, adding that Uber doesn't have as rich of driving and mapping data because only Uber drivers use their app, while Waze is used regularly by average consumers. "Uber has nothing compared to the number of cars on the road that are using Waze, so Waze can yield much richer data."
Uber has encountered a number of problems in rolling out its own fleet of self-driving cars, including one vehicle that failed to stop for a red light during a test run in San Francisco. Uber yesterday announced that it would begin rolling out some self-driving cars in Arizona, which comes after the company pulled its self-driving cars off of roads in California due to the California DMV requesting it secure a permit for the 16-car fleet.
However, for all of Waze's wealth of user data, the service still isn't quite the same as Uber or Lyft's ride-sharing model, which employs drivers to pick up customers.
"It's obviously not a perfect substitute," said Jan Dawson, chief analyst at Jackdaw Research. "...It's a very different prospect to be trying out a new carpooling service versus trying to establish a profile for yourself as a professional driver."
Waze carpool riders may be more pressured to strike up a conversation with drivers, whereas in an Uber or Lyft vehicle, the taxi element is still mostly intact, allowing for riders to be antisocial if they want to, Dawson added.
Some Waze riders have also complained that a request must be made hours in advance and, on occasions, no drivers will accept their request, the Journal noted.
"For an extra two dollars, I might be inclined to say I'll call an Uber or Lyfy or jump into a taxi if there's one right in front of me," O'Donnell explained.
That said, the issues with delays might just be "teething problems" and Google will likely iron them out as Waze continues to grow in scale, Dawson added.
Uber and Lyft have gained widespread recognition in the ride-sharing market, in part, because of their massive TV, billboard and promotional advertising campaigns. Waze has a much different story of how it expanded its user base, largely growing by word of mouth.
Even though it was acquired several years ago by Google, Waze is also still in its early stages, O'Donnell noted.
"The question is will people get used to just jumping into cars, and yet that's kind of what happened with Uber and Lyft," O'Donnell said. "It's the same phenomenon, they just don't have a sticker in the front window."