dollars
399 days ago
 

Google’s Waze acquisition and some eye-watering numbers

Google/ITA just became travel acquisition chump change thanks to Waze.

$300 million:

That’s how many more dollars Google just paid than it did for ITA Software more than two years ago in its announcement in June to acquire Waze, a relatively tiny, self-proclaimed big data company and user-proclaimed social mapping and crowdsourced turn-by-turn navigation application.

Three years:

The amount of time it took a small but baller-status talent team at Waze, based in Israel, to build an asset worth more than one billion to not only Google but also its bidding war buddies, Apple and Facebook, all equally desperate to dominate mapping.

50 million:

The total number of Waze users to-date. No, there isn’t a zero missing.

24 hours a day:

The amount of time Waze has legal, carte blanche permission, given by its opt-in users, to passively capture data about every move they make each day.

While it markets the app’s ability to passively use data simply by you having your app open while driving to update traffic and route data in real time… , it fails to give equal real estate to the fact that if you don’t close out of the app entirely, it can passively capture every bit of your location data that exists within the 23 hours remaining in your day outside of a car.

zero-ish:

The number of travel-first apps that have successfully inspired any 1M+ community of travelers to contribute live crowdsourced location-specific data in real time via a sustainable model. No, TripAdvisor doesn’t count.

For example, airport concessions data, real time air route health projections and re-accommodation alternatives, security wait times, projected traveler ETA at connecting gates and the list goes on… crowdsourcing could provide so much more than we know today, and Foursquare, if anything, continues to prove that point. Waze is proving it out with even greater real-time user engagement.

Billions of data points = Why this acquisition was likely irresistible. Knowing intimate details about where, and thus how, 50 million of the most engaged digital citizens spend every moment of their day feels like an incredibly powerful asset to buy… unless you’re Google and 50 million users is how many fall out of your pocket each day without you noticing.

So let’s take it a step further… knowing where their office is, where their home is, how many days each year their passively shared GPS locates them more than a plane ride away from either of those locations, what time their phone was first within range of a signal upon landing and thus what flight & airline they traveled on, where/what addresses they visited and as a result what hotel they stayed at along with which companies they called on while traveling. As I said… the list goes on.

By knowing where a loyal, tech-savvy and mobile-centric set of 50 million users is every hour of the day, you can fill in a lot of interesting travel-specific data gaps. And mobilizing them to begin capturing all types of other priceless data points that can be used to add more relevance to local real-time travel or travel-adjacent ads on the day-of travel & throughout the trip feels like the sweetest of spots to reside.

Massive:

The size of our over-inflated travel industry egos that may prevent us from accepting the fact that the years of brilliance invested in an asset like ITA can be so easily out-valued by a clipart-cartoon-laced social mapping startup in just three years… but it’s just as much about who else might buy it instead, as what you’re buying.

The price differential may simply say more about how few competitors there are to fear in travel through the eyes of Google versus the world of mapping… which also begs the ever-present question of ‘Aren’t they now all just one in the same?’

Give us your take on the Waze buy: Overpriced? A steal? Or just right?

NB: Dollars image via Shutterstock

 
 
Sarah Kennedy Ellis

About the Writer :: Sarah Kennedy Ellis

Sarah Kennedy Ellis is a contributing Node to Tnooz and director of Sabre Labs, a dedicated emerging technology incubator and trends research lab at Sabre Holdings.

At Sabre since 2007, Sarah has spent time working in a variety of divisions including everything from strategy and product development to social media marketing and R&D.

She was selected as one of the first members of PhoCusWright's inaugural "Class of 35" in 2009, recognizing the top 35 young leaders under the age of 35 in travel.

She also is invited to speak at a variety of technology conferences & industry events each year on topics including emerging technology and innovation management.

The views expressed by Sarah on Tnooz are solely those of the author and do not necessarily represent the views of Sabre Holdings, its partners, customers or subsidiaries.

 

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  1. Steve Sherlock

    @John et al

    You know the ironic bit for me – is that I think our contributions to blogs etc reveals a lot more about us that anything Google or the like, will ever capture.

    I guess the difference is that we volunteer insight into our brains on blogs etc but aren’t really sure what google (for example) captures or does with it.

    For my part – I could not really give a rats – given I think the insights into my brain are what really counts – and I give them freely (or at least I think I do)

    That being said I think I do understand the privacy concerns that people have – I just don’t share those concerns.

     
  2. Kevin May

    Kevin May

    @John Pope

    You hit the nail on the head – “personal point of view”…

    As editor of the beast, I have to remain objective and sit-on-the-fence on most things ;) .

    If I was a consultant or someone waiting to launch a business I’m sure I’d could have lots of fun finally having an opinion ;)

     
    • John Pope

      That’s a tremendous shame you don’t have any Editorial license.

      I thought, most Editors do typically have those types of journalistic freedoms – and that was one of the remits of an Editor was to produce “editorial” content – to write opinion based content that reflected your values. Sort of like the personal view of the various start-ups you guys cover.

      Must put you in a difficult position being unable to transparently reveal your own personal biases (Google must hate that ;-) ). Very difficult, indeed. Many media outlets have no problems coming down on one side or the other, for example:

      The Guardian vs. The Independent
      MSNBC vs. Fox News
      New York Times vs. Wall Street Journal

      And so on…

      Shame you’re unable to be forthright and transparent on your views, so the audience has a clear understanding of what makes Kevin tick. I could understand the more junior journalists being more restricted, but I’d have thought the Editor would be able to let his hair down, so to speak, some days.

      As for the second bit of your comment, I can’t speak for consultants, but I typically wouldn’t recommend someone waiting to launch a business to have as much fun as one might perceive that I do. Truth be told, it’s not always that much fun, being a contrarian and often times going against the staus quo – it tends to isolate people during the politically correct cocktail parties. If you know what I mean?

      It’s a choice, though – personal integrity over commercial or political expediency. Actually, quite an easy choice for me. Thankfully, I embrace the role for all it offers – good and bad – as there is a tremendous amount of satisfaction standing on the side of the “David” (vs Goliath), underdog or common man. It’s a satisfaction no money can buy. My integrity and convictions are not for sale – for any price.

      And finally, because I know you like quotes so much, here’s a Buddhist saying for you to consider, that speaks to the moment:

      “There are two ways to become rich; get more or desire less.”

      Either way, I’m already there – now my job is to try and help others do the same – both tangibly and intangibly.

      Anyways, I digress. I wonder if there are any other brave and intelligent souls out there who would like to take on the Google ethics question? I thought, and was hoping, John C would have more substance to his convictions.

      If not, I’m afraid my Tnooz commenting days will be few and far between from now on.

      My work is done here – a new, very exciting time beckons around the corner. Our knights in shining armor have arrived and come to join the good fight to make this place “A Better World” – one that will live with a strength and purpose of its own. I must focus my noble efforts on that, and that alone.

      Now, it’s off to the Bat Cave to champion the cause of good and righteousness, and to fight evil and tyranny in whatever guise it takes – we’ll start with digital tyranny first, though. So you won’t miss me too much. ;-)

      Adieu, noble people of Tnoozledom, I wish you all a good day, and more importantly, good travels. :-D

       
      • Kevin May

        Kevin May

        @john – i actually have heaps of editorial license… I am the boss, after all.

        I just choose to use it sparingly and effectively, rather than adding pithy comments – with no overall substance or value – to every story.

         
        • John Pope

          Well that explains it then…

          The issue of Google – the largest Internet company on the planet, and quickly becoming a dominant player in travel; specifically because of their dominance in personal data and the size of its existing audience – and its questionable actions of continuing to collect more and more personal data, through acquisitions and additional services, doesn’t qualify as substantive or valuable enough???

          Also, when you consider they (Google) are still fully engaged with the European Union on their suspect behavior on the very same matter – still says to you that it’s not a relevant or big enough a story to comment on?

          That’s odd… from my perspective, anyways.

          To me, it’s the biggest story in travel, and the broader digital space.

          But, I’m not an Editor.

           
  3. Steve Sherlock

    -John, sounds like you think Google will be even able to anticipate, find and assess a Hot girlfriend for me?

    Gee I hope my current girlfriend doesn’t read this post…

     
  4. John Caldwell

    A repost of another discussion….

    ‘..that Google is engaging in an unprecedented strategy to gather an astronomical amount and deeply personal nature of data on all of us they possibly can.’

    A short response for now,
    It seems that with the acquisition of Waze, Google continues to trump all competitors for controlling the business of anticipation. As Google, if I eventually control the tools that record your ‘every action in life’, I will eventually begin to dictate your ‘every action in life’ for the future. As Google I will determine who you are and who you will be, where you are and where you will be and I will formulate your mindset to affect those you encounter as well.

     
    • John Caldwell

      Of course, this is a process we are accustomed to…

      Gov’t Knows Best? White House creates ‘nudge squad’ to shape behavior
      http://www.foxnews.com/politics/2013/07/30/govt-knows-best-white-house-creates-nudge-squad-to-shape-behavior/
      Published July 30, 2013

       
      • John Pope

        Not sure i follow, are all “nudges” positive or negative? Or, does it simply depend on the source of the nudge? Or, does it depend on what behavior is being nudged?

        Is Google’s nudge OK? Is the Obama Administration’s nudge OK? Neither?

        Please elaborate – “Enquiring” minds want to know.

        Show us your hand, Sir Caldwell.

         
        • John Caldwell

          The concept of the ‘nudge’ is manipulation, which every human on earth encounters daily.
          The outcome of this manipulation, as to whether it is OK or not-is subjective
          (I could deliver an 8 hour thesis on subjective manipulating nudges….maybe not)

          We do have two examples that are working to predict outcome, and as it relates to travel…
          -Google wants to make choices for you, based upon your previous choices
          -United States Government wants to make choices for you, based upon the only choices
          it has allowed and continues to allow you to choose from

          Example:
          Over the years I have previously vacationed in Idaho USA and Bahrain,
          with a pattern of visits every 4 years. I stay at hotels that offer average
          amenities and charge an average price. My length of stay is generally 6 nights.

          Since Google knows my history
          -when I’ve stayed, how much I’ve spent, my method of travel along with
          restaurants, points of interest and ALL other information relating to
          my previous vacations
          Google then begins to deliver content to my attention, such as
          -search results, email(including SPAM), direct mail, text messages,
          advertising through third-party sources
          all reminding me it is time to schedule my vacation once again.
          Google will also determine the location, hotel and all other entities
          that would incorporate my stay.

          Since the United States Government knows my history
          -when I’ve stayed, how much I’ve spent, my method of travel along with
          restaurants, points of interest and ALL other information relating to
          my previous vacations
          -as well as who I have been in contact with, my financial history,
          my educational background, my political views, transcripts of my
          phone records, transcripts of my emails…..
          Oh, sorry-kind of got sidetracked

          Back to our example, the United States Government prefers that I
          spend my vacation in a location that offers extradition-and no
          treaty with Bahrain means they will direct me to another location.
          The nudge comes via all sources previously mentioned and also
          includes information shared with others I am in contact with, such
          as my neighbor just learning the people of Bahrain eat their children.
          The current White House Administration has friends in California
          and Delaware-and it is no surprise that all information presented
          to me that shapes my decision points to these two states. Idaho
          does not fit well in the current political structure, and one of my
          coworkers also informs me the residents of Idaho eat their children
          -eating one’s children is the new meme, I suppose. Ultimately,
          my vacation choice has now been shaped to either California or Delaware

          Summary
          Google Nudge-shaping my decisions that are intent on pleasing me
          United States Government Nudge-shaping my decisions that are
          intended to please me, but are
          designed to be pleasing to a cause

          I sure do ramble, don’t I?

           
          • Kevin May

            Kevin May

            @john – don’t worry about rambling… it’s rather common around these parts ;)

             
          • John Pope

            John,

            I think I understand now.

            Google = Good
            Government = Bad
            Idaho & Bahrain = Eating children? (According to your sources)

            Cheers, that clears everything up for me.

            Kevin,

            It’s a shame we all don’t get to hear you ramble a bit more often, from an editorial perspective. The Tnooz audience is missing a very valued personal point of view.

            For instance, what’s your view on the extent of Google’s aggregation of personal data? You’ve not chimed in on that one, yet.

            Have you had a chance to read Scott Cleland’s tome on the subject? I can assure you it’s pretty revealing stuff. All fully referenced, and everything – not the typical conspiracy theory stuff one often reads these days.

            Would genuinely love to hear your thoughts on the subject.

             
  5. John Pope

    I stand corrected.

    I did not realise that:

    a) Hell could freeze over
    b) Pigs could fly
    c) Two (OK, one and a half) great minds could think alike, and
    d) There could be (a momentary) peace in the valley

    And, all of these unquestionable freaks of nature, indeed, happening simultaneously, here on the greatest travel technology media nooz site, to ever grace the digital hallowed walls of the Inter-webs.

    I have learned something entirely new, today. My perspective is awakened with a fresh scent and spirit of optimism, and a different rose-colored tint to my previously opaque and weary eye wear.

    Honestly, who’d have thunk it?

    The world is anew. :-D

     
  6. Tim Peter

    Hi Sarah,

    Thanks for the reply. I think I made my point badly, actually. If you ignore the traffic/community aspect of Waze (where I think its real value lies), and only look at this as a technology buy, Google spent 18% of their 2010 R&D budget to buy ITA vs. 15% of last year’s R&D to buy Waze. So, a point for ITA.

    Still, while the dollar value for Waze was higher (albeit 3 years later), I think Google needed ITA’s tech more than they needed Waze’s. Assuming they valued each the same (from a tech perspective), a $300 million “premium” for Waze’s community is downright cheap compared to what it would likely cost Google to create that on their own. According to The Next Web, Google invested at least $585 million into Google+ just to get to its launch, let alone its ongoing investment in the two years since.

    Finally, ITA serves only one (huge) customer segment while Waze serves myriad customer segments. So comparing these two buys solely as “travel” acquisitions misses all the ways Google potentially stands to benefit from Waze.

    So, while I understand your original point, I still think that you’ve got to look at the whole of the Waze deal and see that comparing Waze and ITA solely on their price isn’t a fair comparison. Each brings something different to the table for Google and their values likely reflect that.

    None of this, of course, is to undermine your larger point that the travel tech space needs some shaking up/innovation/big ideas. That I think we can both agree on.

     
  7. Timothy O'Neil-Dunne

    If I may add a little something about the Googleplex. (Heaven forbid) I agree with Mr Pope here. You should read Scott Cleland’s blog for some interesting perspectives. http://www.precursorblog.com/.

    I believe the argument that Google should be treated as a special case under the US Sherman Act, that is now clear. The simple fact is that no one entity on this planet knows more about you than Google. No longer theory but fact. What they do to commercialize that data has to be considered. Does Google care about the accuracy of this data? Does Google care if the gained knowledge is harmful, annoying or possibly injurious to the consumer?

    Nope. It would appear only when they are caught out red handed with clearly defined abuse under current laws.

    Think about that.

    Cheers

    Timothy

     
  8. Sarah Kennedy Ellis

    Thanks to all for the great comments & spirited debate on this one so far, all.

    @Steve To my knowledge, at least using GPS as your location tracking mechanism, if the phone is off or if location services are disabled for the Waze app, then it’s unlikely you could be tracked as they do track location on an opt-in basis only.

    However, shutting off your phone/disabling location tracking for an app like Waze would also render it essentially useless since it can’t tell where you are located & thus what surrounding crowdsourced data would be valuable to show you based on your location.

    @Tim like the detailed analysis, but the comparison I think is more important is the one I was trying to make – even though I didn’t do so very well or specifically – was the value of Waze as a travel-related acquisition to Google vs. ITA a couple of years prior.

    The point that industry competition in mapping & the threat mapping provides Google from a traffic perspective as compared to travel seems to be revealed in the amount they were willing to pay for something like Waze vs. ITA. Although, I’m sure many of my sharp peers out there would love to debate this point to the contrary, which I’m very interested to hear/learn from if so.

    @John, you opened the door to a subject area on which I spend my mental energy for way too many hours each day – data privacy.

    It is likely impossible for me to comment too specifically on that topic without my passionate personal opinions being unfairly & inaccurately associated with that of my employer – with which they are never necessarily associated or supported/endorsed officially.

    But suffice it to say, in the US, the latest revelations of the PRISM program over the last few months, including what large technology companies are both willing, and in some cases legally forced, to do with user data should be concerning to anyone who values his or her fundamental rights as a citizen.

    We should all be thoughtful of to whom we send & where we give permission to be stored any personally identifiable data on any site or application – whether by authenticating with my Facebook or Twitter ID on a tiny startup’s new kinda-stable-at-best app, or via sharing my location-specific data in exchange for the crowd-sourced value apps like Waze provide, or in using the free & indispensible tools of some of the largest technology companies which have at their disposal the most resources to provide value to users, meet their needs & protect their data. …Not all necessarily considered to be synonymous.

     
  9. John Pope

    Jonathan,

    All absolutely valid arguments from you make. If you are happy with the relationship you have with Google, or anybody else, then that’s great.

    I’m not here to IMPOSE my ideas or values on you, or anybody else; just merely STATE them.

    An exchange of ideas, especially the ideas that we don’t agree with, is a good and healthy thing. No? That’s the wonderful foundation of a democratic society.

    I’m also pretty sure that the vast majority of people will presently agree with your perspective and point of view – and am fully aware mine will likely not “Win many friends and influence many people.”

    Luckily, that’s not my intention – bringing further awareness to this topic is.

    I am interested in the future, though, and what is potentially a better solution to some of the problems we all face today. Very much similar, to the solutions that stopped you from getting a LIDAR ticket the other day.

    That’s all. Same problems, different solutions.

     
  10. Jonathan Weinberg

    “How much longer do you think it will take for the masses to become aware of disproportionate nature of the relationship and finally revolt?”

    The masses don’t really care. As long as they are extracting value from the service (the amount depends on the person) then they will use it. I am very technically savvy and I know exactly what Google is getting from me. Frankly I don’t give a crap as long as I’m getting something useful out of it.

    In the case of Waze, they (now Google) track my location, my route, my speed, etc in order to give other drivers better data on how to avoid traffic jams. I benefit from the data from all other drivers. To be honest, they can track my heart rate and my skin temperature if it will save me an additional 5 minutes on my commute. Doesn’t really matter one iota to me.

    In another example, I report speed traps so other users can benefit in the hope that what goes around comes around and I benefit from the reporting of others. Does this benefit Waze/Google? You betcha. Does it benefit me? It sure did when slowed down to avoid a sure fire LIDAR ticket the other day.

    If you don’t like being a contributor, then you don’t have to report or even use any of these services, but the majority of people don’t really care one way or another IMHO. If you’re waiting for some sort of personal information revolution, well good luck with that.

     
    • John Pope

      Post Script for Jonathan,

      Specifically in response to your statement:

      “The masses don’t really care. As long as they are extracting value…”

      I would agree, most of the masses don’t care – I would argue that’s because they’re not fully aware of all the implications or extent to which Google aggregates a plethora of personal data (information) on each and every one of its users – that Google is tracking their every digital move.

      However, some – an increasingly growing number – do care about the nature and extent of the personal data tracking. The NSA/Prism/Edward Snowden revelation, mentioned previously, is only now starting to bring this issue into the mainstream consciousness.

      I’d highly recommend you read the book, “Search & Destroy: Why You Can’t Trust Google Inc.” by Scott Cleland – the former U.S. Deputy Assistant Secretary of State for Information and Communication Policy – to discover, in detail, the extent and nature of the potential problem Google poses to personal privacy and individual freedom. Yes, the POTENTIAL problem has those implications.

      I’ve only just become aware of who Scott Cleland is, thanks to Timothy’s comment below – cheers Timothy – and acquired the book yesterday. It’s frankly more starting than even I could have ever imagined – and I’m only 60 pages into it.

      The book should be required reading for every GMail, Google+, or any other heavy Google product user – of which, I confess to being an ULTRA-HEAVY user of search, myself – before continuing to utilize the search giant’s “free” applications, any longer.

      Only then, can one sufficiently, and realistically, say they are aware of the potential “down-sides” of using Google products, and accept any future consequences. Google’s Universal Terms of Service – like most Internet companies – is, in fact, a Contract of Adhesion (“Google” that) of which people should take the time to better understand – it’s pretty revealing stuff.

      So, you in fact make my case that the overwhelming majority of “the masses” don’t care because they’re continuing to extract tremendous “perceived” value from the use of Google products; but I believe that is still the case, because the masses have yet to be provided with alternative tools that provide comparable value and scope to the applications Google are presently providing us all.

      In the near future, those dynamics will definitely change, and “the masses” will be provided with far more virtuous and far more ethical tools to fulfill similar needs and problems in the verticals or categories that Google is currently the dominant leader in.

      Then we’ll ultimately see how ubiquitous and attractive Google remains to the masses.

      Bottom line: I believe, There Is A Better Way.

      Much better.

       
  11. Kevin May

    Kevin May

    Oh john. Please stop the teasing and endless quotes and analogies.

    The suspense about changes of equations and the game is killing us all.

    Our readers deserve to be enlightened, no?

    In true TOD style, we also plead for sub-250 words as well ;)

     
    • John Pope

      Kevin,

      A wise man once told me – I won’t quote him, just paraphrase ;-) – that one can learn much more about a person by what they don’t say, than what they do.

      This was no tease – it was a genuine treatise on what I believe is one of the most relevant and important topics of the Digital Age. My bad if this tl;dr viewpoint is now inappropriate for this forum, I’ll keep it very pithy, in future. The message is no longer mixed – clarity is a good thing.

      Concision is an important characteristic for many of your fellow media outlets; thank you for highlighting the rules of the game – I will absolutely never make that mistake again on your domain. And, sincere apologies for my past verbosity – I mistakenly feel it is sometimes required to adequately explain a complex issue.

      Unfortunately, I’m rarely able to make my point in 140 characters or less, that some audiences prefer. Suppose I’m just a throw-back to the more examined days of old when one needed to provide reason, context and foundation when making an argument, that is generally not accepted as conventional wisdom.

      And, apologies for the use of “words of wisdom” from some mental giants throughout human history, but I think it important to give credit to the people who have learned lessons of human behavior, so that we may learn from their experiences, and hopefully aren’t plagued to repeat some of the mistakes made before us.

      Enough small talk, though. Any comments on the substance of my argument?

       
    • John Pope

      P.S. Sorry, forgot to address the changing equations, deadly suspense and need for your readers to be enlightened about all of our stealthy scheming, previously. (I’m conscious of my ongoing wordiness)

      It turns out, changing the digital world is more difficult and time consuming than one might think, but as I promised to you previously many times already, you’ll be the first to know when the penny drops.

      How could I possibly deny you and the Tnooz family the scoop? After all, you’ve been incredibly gracious to us, thus far.

       
  12. John Pope

    Hi Sarah,

    Congrats on your upgrade to Director of Sabre Studios – a friend referred to it as Offutt 2.0, so you’ll have big shoes to fill. I’m sure you won’t have much problem doing so, and will likely need an even bigger pair. :-)

    Alas, it probably means you’ll ultimately have less time to share your opinions with the greater Tnooz and travel industry audience. We’ll all have to be content with the satisfaction of your eventual and inevitable rise to the C-Suite level of Sabre, or wherever the warm, kind winds of travel might blow you to next.

    I enjoyed reading your perspective on this one, and understand the positive sentiment you’ve attached to this move, as a complement to Google’s already exhaustive and prolific data sources.

    However, I’m compelled to posit another, less optimistic, perspective though (go figure), to hopefully stimulate the debate to its efficacy and broader ethical implications on the digital landscape. I purposely waited for the masses to have already consumed this thread and, thereby, prolonged the calm before the potential storm.

    As you playfully, accurately and rightfully, articulated about the deep data insight that Google will be able to glean from the large and growing Waze community: “Waze is proving it (crowd-sourced user data) out with even greater real-time user engagement.”

    And, even more revealing: “Knowing intimate details about where, and thus how, 50 million of the most engaged digital citizens spend every moment of their day feels like an incredibly powerful asset to buy… ”

    Finally ending with more astute observations and praise: “By knowing where a loyal, tech-savvy and mobile-centric set of 50 million users is every hour of the day, you can fill in a lot of interesting travel-specific data gaps. And mobilizing them to begin capturing all types of other priceless data points that can be used to add more relevance to local real-time travel or travel-adjacent ads on the day-of travel & throughout the trip feels like the sweetest of spots to reside.”

    I absolutely appreciate your positive sentiment and characterization of this being a super smart and savvy move by Google, and its desire to possibly pay over the odds for such a potentially, and increasingly valuable future asset; but let me paint a more sober and less rosy picture of what this also means in the grand context of Google’s “Data At All Costs” strategy.

    So, in return for an unquestionably useful application that tells its users where the next speed trap, or driving route to avoid is, Google gets a litany of deeply revealing personal data and further data points – especially if remained signed-in – to add to their already – arguably intrusive and Big Brotherish – significant plethora of other deeply personal data points, via their existing hundreds of millions of users, and their highly addicted use of Google’s portfolio of other “free” applications, as follows:

    Search – deep and intimate details of all the topics of user’s Internet search history

    GMail – transparent insight into the topics and content of user’s “private” email messages

    Google Plus – a user’s social graph, interest graph and general digital engagement levels aggregated together from all Google applications a user engages with, are now attached to your personal non-anonymous G+ Profile, as per their recently updated Universal Terms of Service

    Chrome – your complete browsing history and patterns to further understand all of a user’s interests and digital engagement levels

    Android – mobile usage data, geo-data, personal contact data, app consumption data and more

    YouTube – a user’s video tastes, interests, preferences and consumption

    Google Wallet – insight into a user’s actual purchase history, and maybe even their credit history, in future

    Google Glass – data about what user a sees, where they go (geo-data), who they interact with (face recognition)

    There are, of course, many more existing – and, I’m sure future – applications and hardware that Google ultimately uses to glean further data points – both anonymous and personal – about their growing user base.

    At what point does this aggregation of deep personal data become too much? When does the Tipping Point happen? When do we collectively decide, enough is enough?

    So, because of all these data acquisition sources, applications and strategies that Google has organically built or via acquisition assumed possession of, I believe it’s not completely speaking out of turn to suggest that Google has adopted a strategy kind of similar to the good folks at MTV and the “Pimp My Ride” television program, to produce a new reality show where many people globally are apart of called: “PIMP MY DATA.”

    That’s right, I believe Google is essentially profiting from the work, contribution and value of other people’s data – or more accurately, people’s work or engagement with all the various apps that Google “benevolently” provides for free.

    The reality is, NONE OF THESE APPS ARE FREE, the price to pay by all of us (Google’s audience) is, we ultimately become the product. We’re all the ones who have metaphorical bar codes on the back of our necks – made famous by Apple’s 1984 TV commercial/advert – when considering Google’s business model as it exists today.

    To me – and my cynical-but-idealistic viewpoint – this is an EXTREMELY DISPROPORTIONATE RELATIONSHIP between the user and Google. The value gained by Google is FAR greater than the value received by WE, THE USERS (PEOPLE). That may not be the perception of some, I know, but it is the reality. As Gandhi said, “Even if you are a minority of one; the truth is still the truth.”

    I previously used an analogy of a farmer who receives all of his new, state-of-the-art and wonderful farm equipment every year for free from the manufacturer, only to have to give away all of his crops for free, in return. A.K.A. You get access to the applications for free, but then are required to produce all the work, effort and contributions that ultimately produce most of the real tangible value. And that value mostly ends up in the hands of the savvy owner of the apps, and his pursuit to further accumulate vast amounts of personal wealth.

    This is how Kings, Queens, Lords and Ladies of yester year used to treat the serfs who did all the work and produced all the wealth for the Masters Of The Manor’s own personal well-being, in return for a meager plight and humble existence.

    There’s a saying amongst the elite and powerful propagandists throughout history that the best form of tyranny is the kind that those affected by it are unaware of its more virtuous alternative.

    I realize that there is a nostalgic sentiment around the plight of Royals these days, but I have to ask the question: when is enough, enough?

    How much longer do you think it will take for the masses to become aware of disproportionate nature of the relationship and finally revolt?

    One never can tell, exactly. But….

    This smells like an ideal opportunity to change the equation, to me. I reckon the ideal time is approaching more quickly every day.

    After all, we serfs deserve it. :-D

     
  13. Tim Peter

    Hi Sarah,

    Great post and great insights. Here’s a quick thought about how to value the purchase.

    According to its financial statements for year-end 2012, Google spent roughly $17.8 billion last year on traffic acquisition (TAC) and R&D. That’s about $341 million a week. So, Google spent roughly 3 weeks worth of its annual TAC/R&D budget to acquire a 50-million strong, crowd-sourced mapping solution.

    Could they have achieved the same results by investing that money in building its own community? Probably not easily.

    Some further context:
    - Mapping remains crucial to consumers’ mobile experience (a topic I’ve talked about before here: http://www.timpeter.com/blog/2013/06/11/4-reasons-why-google-metasearch-in-maps-matters-travel-tuesday/)
    - Google missed analyst expectations for revenues last quarter largely due to consumers’ increased use of mobile and Google’s less effective monetization of mobile as a platform.
    - Google continues to face competition in the space. For instance, Apple recently bought crowd-sourced location data service Locationary this past Friday to improve its map offering.

    Given that, it doesn’t seem like three weeks’ worth of TAC/R&D spend is all that much for Big G.

     
  14. Steve Sherlock

    I wonder if when the app is out of 3G/Data range or if Data is turned off (due to high overseas costs) if the technology still allows for GPS tracking?

     
  15. Alex

    I think the reason behind the massive crowd appeal and willingness to contribute from the users is the very real utility of the app. Users love the app experience and are very satisfied from the services it provides. Since they get so much use out of it, most are okay with contributing (especially passively where you don’t actually have to do anything!).

    You would have to first define what “travel-first” app would be in order to see whether it’s possible for them to create equally useful service. Most apps are used sparsely since people don’t travel frequently hence maybe the “perceived utility” of such app isn’t very high. When there’s frequent use – e.g. business travelers and TripIt – there’s high contribution factor (people are willing to share their full itinerary details).

     
  16. Oz Har Adir

    Probably over priced for its current direct value, just right for competitors not having it, and if they can bring the Waze user engagement magic to the whole of Google Maps community -> a steal!

     
  17. Jonathan Weinberg

    Frankly I’m thrilled that Google bought Waze. I think Facebook totally missed a major opportunity, but on the other hand, I find the social features of Waze a yawner, so from a personal standpoint, I way prefer a Google-Waze combination. I find that Google’s mapping and routing is more comprehensive and accurate than Waze, but that Waze’s traffic avoidance capabilities and notification of radar traps are better than Google. Combine the two together in an intelligent way and you have a massive win.

    While Waze certainly was no steal, I think given its potential it could pay off in the end if Google plays their cards right. Then again, Google has had their missteps, so it’s all comes down to execution at this point. Please the love of everything holy, don’t focus on Waze to Google Plus integration as a major benefit, otherwise you might as well flush that $1B+ down the toilet.

     
 
 

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