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Though, there remains no ambiguity about Google Inc’s acquisition of the navigation tool- Waze App, which is owned by Noam Bardin, the CEO and developer of the navigation app, it may unsuspectingly put Google Inc into some legal trouble.

Trade analysts, analysing the entire saga of Waze App acquisition, have this to stay: Google as a strong player in the search-engine segment, by acquiring Waze navigation tool to further beef its own navigation tool, Google Maps may unwittingly violate a provision of Clayton Act. According to experts, Clayton Act in the context of mergers strongly outlines that, “the effect of such mergers … may be substantially to lessen competition, or to tend to create a monopoly.” Antitrust cannot at all times prevent monopolization believe many laws effective both in the US and the European Union.

In fact, analysts believe that Google Inc. would monopolize the online navigation segment due Google acquisition of Waze App was largely founded on Waze App CEO’s comments at the recently held AllThingsD conference: “We feel that we’re the only reasonable competition to [Google] in this market of creating maps that are really geared for mobile, for real-time, for consumers — for the new world that we’re moving into.”

Google Maps is big on Desktops, Waze App on mobiles

Though, there is huge community that is quick to object considering that Google Maps is largely confined to desktop based search, while Waze App was built for the mobile platform.

However, internet and company law pundits point out that Google already holds 92% of the online ad segment and has made substantial forays into mobile advertising real estate as well through it various tiny ads.

Examples of monopoly from public carrier networks like AT&Tand T-Mobile merger too can be considered when evaluating Google acquisition of Waze App. Legal analysts argue that the merger may draw the attention of The Department of Justice as Google Inc’s online advertising is one of the largest in the industry as is the case with online mapping as well.

Waze App data-collection technique

Additionally, analysts believe that the user-based navigation data that drives the Waze App is suspect. Primary cause of worry is, if the user community were to subside or if there was a fall in the number of data instances coming-in, say in reference to accidents or traffic-jams, the app would typically fail to deliver on the promised services. The entire functionality of the App would be suspect, believe analysts. Essentially, Waze App support free baseline navigation and this has helped the app community grow over the past half-decade to 45 million users. The immense number of users have helped the App gain value and a fair-commodity for acquisition by established companies. Waze App’s Noam Bian has said that initial talks with FaceBook had failed before his company seriously studied integrating with Google Inc.

If Google acquisition of Waze App is successful then there is a possibility that it could raise the alarm among anti-trust lobbyists again!

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If news bytes by people in the know-how at Facebook Inc. are to be believed, a high-net-worth-navigation app called Waze is likely to be acquired for an astounding $1 billion. Waze is a free-to-use navigation tool for mobile devices and popular in more than 193 countries. Founded in 2008 in Israel, it has offices in New York, California and Israel, and employs 100 or more people. It has some of the best mapping information available online and has over 50 million users. The app gives subscribers route directions based on updates received from other users so that they can avoid  exhausting traffic jams and steer clear of roads blocked due to various reasons. The uniqueness of the Waze app is its value-addition as a social network. Waze currently earns all revenue through advertising the real estate. Facebook has been exploring other mobile asset spectrums ever since its initial public offering (IPO). Currently, Facebook Inc.’s shares are worth around $27.04 – a figure much less than the IPO price of $38 in May 2012. Facebook Inc. has been on an asset building-spree since then and has purchases the highly trendy photo-sharing app Instagram, which is also widely used by celebs, for $700 million with a cash-and-stock deal.  Parse, a highly priced start-up involved in building mobile applications, was also snapped-up by Facebook recently as the social giant aims to expand.

How will Waze help Facebook?

Facebook Inc. is keen on acquiring the Waze app to expand its mobile assets portfolio and add key function features to the current mapping services it provides. Facebook is already geared to generate more revenue through its mobile advertisements. Waze will offer the best opportunity for Facebook Inc., for the navigation app is used increasingly in crowded, dense cities. Facebook Inc. will now be at the centre of navigation communication and from subscriber user patterns mine valuable ‘big data.’ Additionally, it will acquire the keen capability to optimize its location-based advertisements. It is likely that Facebook Inc. will now allow commercial establishments such as restaurants or stores to place ads for Waze users as they navigate in the vicinity of the stores.

Acquisition bound to happen

Though, there is a likely possibility of the deal not going through at all, industry analysts believe that the acquisition is an event waiting to happen. It all began when the Waze app offered its users log-in facility through Facebook Inn. Another interesting fact is the friendship that stakeholders at Facebook and Waze have: the CEO at Waze, Noam Bardin shares with the current local-service chief at Facebook Inc., Josh Williams, was bound to influence the acquisition. Interestingly, Josh Williams own self-grown app – Gowalla- was snapped by Facebook Inc. for its location based prowess; ever since then, Williams has headed the local-services segment for Facebook Inc. Additionally, an ex-Gowalla VP, Andy Ellwood, currently heads Waze’s Business Development section. With Facebook Inc. seeking to further strengthen its mobile products segment by acquiring a cross-section of mobile-use products, Waze CEO, Mr. Bardin, is already enthused about the deal.

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