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Tuesday, June 11, 2013

Google Expands Its Boundaries, Buying Waze for $1 Billion

2:13 p.m. | Updated Added comments from Waze’s chief executive.

Google announced Tuesday that it had closed its deal to buy Waze, a social mapping start-up that features real-time traffic data provided by users to help drivers find the fastest route to a destination.

Google did not disclose the purchase price in its blog post announcing the deal. But a person familiar with the transaction said the price was $1.03 billion.

As I wrote in an article published Tuesday, the deal highlights the increasing importance of location data in our on-the-go lives, whether it is finding a place to eat or navigating an unfamiliar road.

Waze has drawn a particularly passionate base of nearly 50 million users around the world. In any given month, about one third of them turn on the app to access the company’s directions. Waze passively tracks their movements via GPS to generate live information about roads and traffic. And users can add their own information about accidents, police speed traps and road hazards to share with others.

Google said that Waze will remain separate from its own Maps service. Some of Waze’s real-time traffic data will feed into Google Maps, however, and Google plans to incorporate its powerful search capabilities into Waze.

“We’ll also work closely with the vibrant Waze community, who are the DNA of this app, to ensure they have what’s needed to grow and prosper,” Brian McClendon, the Google vice president responsible for its geographic products, said in the blog post.

Google and Waze declined to make any executives available for an interview.

But in his own blog post, Waze’s chief executive, Noah Bardin, said, “Nothing practical will change here at Waze. We will maintain our community, brand, service and organization - the community hierarchy, responsibilities and processes will remain the same.”

Mr. Bardin indicated that he and other Waze employees plan to remain with the company. And its product development team will be allowed to remain in Israel, where the company has most of its operations.

He said the company had considered staying independent and selling stock in an initial public offering to raise money to expand but decided that “Google is committed to help us achieve our common goal and provide us with the independence and resources we need to succeed.”