Waze vs Google Maps - Why Google bought Waze for $1 billion - YouTube

Just ten or twenty years ago, driving to a new  location meant taking out your folding road atlas,  

and making a note of every turn, crossroad  and roundabout that was to come on your route.

But these days the answer lies in the palm of your  hand, with the likes of Google and Apple pointing  

you to your destination every step of the way. And today, we’ll be discussing Waze,  

the community based app that does things  slightly differently to its rivals.

So why exactly did Google  acquire Waze 8 years ago, 

And how does the app differ from  services like Google and Apple Maps

Here’s How It Happened.

The roots of Waze can be  traced back to Israel in 2006,  

as founder Ehud Shabtai developed  a community project called FreeMap,  

which relied on crowd sourcing to produce  a map of Israel entirely in Hebrew.

Members of the community were required to  download the app whenever they drove around,  

and their movements would be used to  map the roads of the whole country.

4G or even 3G technology had yet to  become widespread, and so the mapping  

took place entirely offline, only  uploaded after users returned home,  

plugged their phone or GPS  device into their computer,  

and added their journey to the Map Editor  that would connect everyone’s roads together.

After kicking off with just a few hundred  drivers across Israel, the application had  

received tens of thousands of downloads by  2009 and had also obtained a new name: Waze.

By then the company had conducted its first  funding round, raising $12 million, and appointed  

a business savvy CEO, Noam Bardin, who had already  founded voice recognition service Deltathree.

Waze was becoming a social platform too,  allowing for users to send messages about  

traffic incidents or potential  hazards, and quirkier elements  

like the Pac Man avatar appearing when a  road is being tracked for the first time. 

In 2010, a further $25 million was  raised, by which time the app had  

amassed over 2 million users, and a Series  C round took place less than a year later.

The company was soon seeking to monetise  the millions of users at their disposal,  

adding small advertising space across  the app’s interface based on location,  

and negotiating with American news outlets to use  their traffic updates to keep drivers informed.

Waze was named Best Overall Mobile App by  the GSM Association, which was enough to  

convince Google to part with around a billion  dollars to acquire the Israeli startup in 2013.

Even following its big money takeover,  Waze continued to live true to its original  

crowdsourcing model, as Wazers could record  speed traps, update house numbers and alert  

the app of any other information that could  be useful, all shared and stored anonymously.

And the improvements have come thick  and fast, offering voice commands from  

the likes of Morgan Freeman and Arnold  Schwarzenegger or to record their own,  

as well as partnerships with products like  Spotify, Google Assistant and YouTube Music,  

to integrate as seamlessly as  possible into users’ daily activities.

To their credit, Google allowed Waze to  operate independently of Google Maps,  

a strategy that has proven successful for  Facebook’s acquisitions of WhatsApp and  

Instagram, which encouraged  Bardin to stay on as CEO.

While Google Maps has been developed as an  all-in-one transportation app, encompassing  

driving, walking, public transport and even  flights to name just a few of their options,  

Waze has remained totally devoted to driving,  creating a more streamlined service that  

offers greater customisation  for those travelling by road,  

all while taking a more community-driven  approach, compared to Google’s emphasis on data.

So why is Waze’s user base only  a fraction of its big brother’s? 

The answer lies partly in the name, with  Google offering a much better known,  

and for some, more trustworthy brand. Applications like Gmail, Chrome  

and Google Drive can already be found  on billions of smartphones worldwide,  

and Google Maps feels like a satisfying  addition to many of these users.

Of course Waze has no relevance to those  without a drivers licence or live in dense  

cities where driving is rarely necessary, while  faults have also been found in the app itself.

For example, the feature of marking  roadside police offers has drawn  

critics for undermining road safety and  posing a risk to the cops themselves

And its interface, although  more modern and minimalist,  

has often been described as cartoonish,  and there have been suggestions that  

the overly bright graphics could  prove a distraction for drivers.

In spite of the app’s 140 million users, Bardin  stepped down from his role in early 2021,  

describing himself as “Worn down  by the nature of the beast”,  

and citing the reduced risk-taking  following Google’s involvement.

His successor, Neha Parikh arrives after  successes at Hotels dot com and Hotwire,  

and is tasked with helping the firm  recover from the effects of the global  

pandemic and hopefully become the  number one in road navigation.

And that’s how it happened.

Thanks for watching.