If the sale is concluded, it would give Facebook the ability to better deliver locally tailored ads and content to its 1.1 billion users.
The potential purchase price, which some news reports have said could run as high as $1 billion, would rival what Facebook paid last year to buy Instagram, a fast-growing mobile photo-sharing service.
Waze, which is based in Israel, has been talking to potential suitors for months, and the discussions are fluid. A deal may not be reached or other bidders could emerge.
A Facebook spokesman said the company did not comment on speculation. A Waze spokesman could not be reached for comment on Thursday evening.
The Israeli publication Calcalist first reported the news of the talks.
Maps have become a crucial battleground for big technology companies, including Google, Apple and Microsoft, as consumers rely more heavily on their cellphones and companies strive to deliver more location-based advertising and services.
Waze, which has more than 40 million users globally, is unusual in that it relies primarily on GPS data and real-time information from its users, who contribute updates on traffic, routes and even where to buy cheap gasoline.
Users of the service also typically share their locations continually as they drive — a potential gold mine of data that would be useful for Facebook as it seeks to serve up targeted ads.
“These people are giving permission for the cloud to track where they are,” said Brian Blau, a research director at Gartner, a technology research firm. “This is a particularly difficult problem for social networks in general. Very few people want to be tracked.”
Facebook currently uses maps from Microsoft’s Bing, but it also has a relationship with Waze. Facebook users can log into Waze using their Facebook accounts and share their location data with their Facebook friends.
Other technology companies, particularly Apple and Google, have also been watching Waze closely and may be interested in a potential acquisition of the start-up to improve their own mobile mapping services.
Facebook has been trying a variety of strategies to increase the amount of time that its users spend on its site, particularly on mobile phones. Last month, it introduced a new interface for Android smartphones called Facebook Home, and on Thursday the company said that about one million users had downloaded the software.
Facebook and other social media companies are just beginning to wrestle with the challenges of effectively delivering local advertising to their customers.
While Facebook might not be able to use Waze’s data immediately for that purpose, Mr. Blau said “this is more for the future. They are going to want to deliver contextual advertising.”
Waze has raised several rounds of financing from venture capital firms, including Kleiner Perkins Caufield Byers, BlueRun Ventures, Magma Venture Partners and Vertex Venture Capital.
Claire Cain Miller contributed reporting.
Article source: http://www.nytimes.com/2013/05/10/technology/facebook-is-said-to-be-in-talks-to-buy-waze.html?partner=rss&emc=rss