Rumor Mill: Facebook makes $1B play for social mapping startup Waze

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Facebook (NASDAQ:FB) is on the verge of acquiring crowdsourced location services firm Waze for between $800 million and $1 billion, according to multiple reports in Israeli business journals Calcalist, Ynet, and The Market.

Insiders say a term sheet has been signed and due diligence is underway, adding that talks began about six months ago. TechCrunch corroborates the reports, citing a source who said both Facebook and Waze have privately confirmed the deal is happening and that reports of the purchase price range are accurate. That source added that the biggest question is whether to keep Waze in Israel or relocate the business to the U.S.--Facebook previously acquired two other Israeli startups, feature phone interface developer Snaptu (purchased for upwards of $70 million in March 2011) and facial recognition specialist Face.com (bought in June 2012 for between $50 million and 60 million), and in both cases brought them to U.S. shores.

"We won't comment on speculation," a Facebook spokesperson told TechCrunch, while a Waze representative added "We do not comment on rumors or speculation about the business."

The Waze application assembles turn-by-turn GPS navigation, real-time traffic updates and social networking components to improve the daily commute, with all map and traffic information originating via on-the-go users who keep the solution open on their mobile device. Users can also actively contribute reports on accidents, police traps and related hazards. More than 47 million drivers now use Waze across operating systems including Apple's (NASDAQ:AAPL) iOS and Google's (NASDAQ:GOOG) Android.

Waze is also one of several companies providing mapping and navigation data to Apple Maps, released last year in association with the revamped iOS 6. Earlier this year, TechCrunch reported that Apple was in advanced negotiations to acquire Waze, but one day the publication posted a follow-up article stating the deal was not happening, an assertion backed by other media outlets. A source familiar with Apple's thinking told CNet the rumors were "fabricated." Both Apple and Waze declined to comment at that time.

Facebook is presumably targeting Waze to bolster its location-based social media efforts, including check-ins and deals. Facebook's mobile monthly active users grew from 488 million to 751 million in the first quarter of 2013, a year-over-year increase of 54 percent, and mobile-only MAUs surged to 189 million from 157 million a quarter ago. In addition, 30 percent of Facebook's advertising revenue now comes from mobile, up from 23 percent in the previous quarter.

For more:
- read this TechCrunch article
- read this Reuters article

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