Google paid $1.3 billion in June 2013 to acquire Israeli startup Waze, but now the Google deal faces a U.S. Federal Trade Commission investigation.
The U.S. Federal Trade Commission is investigating Google's $1.3 billion deal to buy crowd-sourced mapping app Waze, according to reports.
Following demands from critics that are worried Google could dominate the market in online mapping, the FTC is deciding whether or not that Google has an unfair advantage and could restrict consumer choice -- mainly because the Israeli startup Waze said "it's only real competitor was Google," according to the Guardian.
This isn't Google's first investigation by the FTC, it currently is under investigation for dominance of online advertising and "abuse" or Motorola subsidiary patents. The tech titan is also being investigated in Europe for its search results and privacy violations. In March, Google agreed to pay $7 million to settle a multistate "wi-spying" case where Google Street View vans collected sensitive user information over wireless connections. Google paid out $22.5 million for tracking Safari browser users online last year.
The FTC seems to be most concerned that Google's takeover of Waze would reduce consumer choice for online mapping in an already small market. Google Maps is already a very popular app that comes with most Android handsets and was downloaded more than 10 million times in the first 48 hours of arriving at Apple's App Store.
Once a company reaches Google's size and reach, it doesn't seem strange that a federal agency starts investigating its deals. Waze does have more than 60 million users, so its market share may be smaller but still is significant. We don't think the investigation will do any harm.