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Google Inc (GOOG), Facebook Inc (FB) – The Mobile Battle: Round 2

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Google Inc (NASDAQ:GOOG) is strengthening itself in the mobile arena after it disclosed it was buying Waze, a software company that strives to make maps more accurate. This move comes at a time when the company was beaten by Facebook Inc (NASDAQ:FB) as the most used mobile application in the U.S. The deal is estimated to be around $1 billion. Although it is an expensive buy, it is strategic as it prevents Facebook Inc (NASDAQ:FB) from acquiring the company and gives Google Inc (NASDAQ:GOOG) the opportunity to further develop its mapping software and drive more users to it. The battle is just beginning.

Google Inc (GOOG)

The main competitors in the U.S. in the mobile field are Google and Facebook Inc (NASDAQ:FB). Although Facebook surpassed the Google Inc (NASDAQ:GOOG) Maps application, the search engine company is third in the list with Google Play, fourth with Google Inc (NASDAQ:GOOG) Search, fifth with Gmail and sixth with YouTube, exhibiting a clear dominance. Very far apart is

Apple Inc. (NASDAQ:AAPL)

at the eighth place after attempting to create a map application last year that was a failure as it contained too many flaws and cost Scott Forstall, the software chief, his job.

So why did Google acquire Waze?

Although Google Inc (NASDAQ:GOOG) has the most popular map navigation software, it lacks social features in its mapping software. Waze’s acquisition could help the search giant get some of those social skills needed as it has a location-based platform that can be used to locate friends and share locations. Google Inc (NASDAQ:GOOG) has been trying to develop social characteristics in its applications, but its success was very limited. A clear example of this is Google+ that attempts to steal from Facebook Inc (NASDAQ:FB) a bit of the social media pie.

Moreover, Waze can add some other features to Google maps, such as better location-based ads and integration to the Android platform in a great way. Finally, the Waze application is available on Apple Inc. (NASDAQ:AAPL), so it will be a huge blow for the company that is trying to regain ground on mobile applications such as maps.

How will Facebook and Apple respond?

Apple Inc. (NASDAQ:AAPL) will probably improve its own map application rather than acquiring another company. It lost the perfect opportunity to do that very quickly and effectively by acquiring Waze. If Apple Inc. (NASDAQ:AAPL) develops a better mapping software, it could re-enter the mobile app arena but this will take time and patience, something some users are not willing to do. By removing Google maps from the iPhone, as it had done previously, the company could generate a single option for mobile users to choose from and oblige them to use Apple Inc. (NASDAQ:AAPL)’s application. This could slightly revert the trend.

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