Google confirmed that the Federal Trade Commission would like to review the latest acquisition the company had--$1.1 billion Waze deal.
The search engine giant was contacted by the lawyers of the commission on Saturday to investigate if the deal was an act of competition manipulation. Google did not give further details about the antitrust review while the agency didn’t respond when asked for comments. Waze is fourth of the most expensive acquisition the company had in 15 years.
So what’s next between Google and Waze?
Some antitrust lawyers said that it is improbable for FTC to ask Google to invalidate the deal. The agency will need to present strong evidences that the deal would radically collapse the competition in the mapping market.
Looking at the current revenue of Waze, it was too low to become a target of antitrust but it can still be reviewed later on. While the deal can’t be invalidated, it is possible that FTC would ask Google not to incorporate its technology with Waze while they are still reviewing the deal.
Behind the deal
FTC triggered the antitrust review in order to find out if Waze can possibly become an arch rival of Google Maps and if there are emails or discussions indicating any manipulation done by Google. There were rumors that the search engine giant decided to acquire Waze just to keep it away from their rivals such as Facebook, Microsoft, Apple, and Nokia Corp. These companies refused to comment about the deal but it can surely impact their own mapping service as some parts of it rely on Waze data.
Waze is a mapping and navigation service developed in Israel and is being used in over 190 countries. To date, it had received 45 million downloads. This is a small portion compared to Google Maps billion downloads. Waze uses GPS to determine the traffic of the roads and provide alternative routes to drivers. Part of the deal was to have Google Maps and Waze share each other’s technology.
FTC recently ended an antitrust probe involving Google’s search advertising business.
