Yesterday, the world learned that Facebook is close to buying user-generated mapping company Waze for about $1 billion.
This news has many people scratching their heads, wondering what Facebook is thinking.
Last spring, of course, another ~$1 billion acquisition by Facebook had some people scratching their head–the acquisition of revenue-less Instagram.
But the Instagram buy was actually brilliant.
Instagram was highly complementary to Facebook’s business. Facebook users were dropping Facebook and moving to Instagram. Instagram’s mobile prowess would also help Facebook expand to mobile. Instagram was all about photos, the ideal mobile and social application. Instagram represented a highly promising green field for future visual social advertising. And so on.
Instagram, in short, was a brilliant acquisition. And all those who viewed it as confirmation that Facebook’s 27-year old CEO Mark Zuckerberg was out of his depth have been proven to be shortsighted, vision-less bean-counters. (Meanwhile, check out how Instagram’s CEO has spent the year after selling his 1.5 year old company for $1 billion).
Waze offers a free “turn by turn” navigation app for mobile devices, one that takes into account real-time traffic information generated by other Waze users.
Aside from being “mobile,” how is this complementary to Facebook?
What does this tell us about Facebook’s future product vision?
We’ll be looking into this today. So if you have any thoughts, please send them along. We would hate to have to conclude that Facebook is effectively throwing in the towel on its main social-networking business and desperately casting around for another business to go into.