Show me the Waze to go home

With 22.5 billion kilometers logged and 100 million users, Waze has rapidly become the navigation app of choice.
And it got there through crowd-sourcing.

“Show me the Waze to go home”

Waze is a navigation app that uses crowd-sourced driver data to optimize routes, provide accurate ETAs, and alert drivers of upcoming road hazards. [1]

Most of Waze’s data is passively collected from drivers who are using the app to navigate.  Drivers can also use a simple interface to report road hazards such as accidents, police, construction and traffic jams.  As other Waze drivers approach these reported hazards, Waze sounds an alert, and the driver is prompted to confirm whether the hazard was present. [2]

With its search and maps further enabled by Google—which acquired Waze in 2013 for over $1 billion [3]—Waze has quickly become the navigation app of choice, logging 22.5 billion kilometers driven. [4]

Value creation

Waze creates significant value for individual drivers by providing unparalleled route information and ETAs.  Moreover, the network effects generated by Waze’s crowd-sourcing model (i.e., each additional driver adds more accurate and valuable information for all drivers) are a natural defense to multi-homing on other navigation apps.

Waze continues to add features to create even more value for its community of users.  For example, Waze is trying to crowd-source information about gas prices so it can route drivers to the lowest priced gas station.  Waze also has integrated with other apps, such as Outlook (syncing your calendar with ETA-based departure reminders), Messenger apps (one-tap function to send your ETA via email/text) and Spotify.

Waze’s crowd-sourcing also creates significant value for society.  By optimizing routes, Waze helps reduce congestion and air pollution in urban areas.  Waze also helps alert drivers to approaching hazards, such as stopped vehicles or debris in the road, which helps prevent automobile accidents and injuries.

Value capture

While Waze passes on much of its value creation to its driver community, it does capture significant value from its crowd-sourced information.  Waze offers a variety of in-app ads, such as branded pins (reminder of business location on route map), promoted search (location appears at top of search results), and zero-speed takeover billboards (apps shown when drivers are at a complete stop). [5]

Waze also captures the massive amounts of commuter data generated by its driver community, which it can aggregate and use for a variety of purposes. [6]

Waze incentivizes extra participation with superuser status and map raids

Like many free crowd-sourced apps, Waze incentivizes extra participation through superuser status, which grants additional editing powers to users as they progress in experience.  Users begin as map editors, and can progress through manager roles (area, state, country), and eventually be promoted to a local or global champ (thereby earning “eternal glory”) [7].  Waze also allows for self-organized map raids, where users gather for a time-limited event to overhaul a certain area.

Next destination?  Uber and Lyft

Waze has introduced Waze Carpool to California, Texas and most recently Washington state. [8]  Waze Carpool connects commuters who have similar commutes and mutual friends.  But unlike Uber or Lyft, Waze does not seek to compensate drivers beyond cost.  Instead, Waze Carpool seeks to “share” the costs, with riders paying “for an affordable ride, while drivers get money back for gas.” [9]


But Waze still faces tough criticism, especially from law enforcement.  While police recognize the value of alerting drivers to road hazards, they are concerned about Waze sharing police locations, since it jeopardizes officer safety. [10]  Also, gains in safety and accident prevention may be offset by increased speeding and reckless driving, e.g., by drivers who do not see an upcoming police alert.  Waze will need to find innovative ways of addressing these concerns.


[1] See generally

[2] Waze Press Assets, available at, (accessed Mar. 20, 2018).

[3] Amir Efrati and Ben Fox Rubin, “Google Confirms Waze Maps App Purchase,” (June 11, 2013), available at

[4] Waze Company Factsheet (accessed Mar. 20, 2018), available at

[5] “Bring drivers to your business with the world’s largest community-based navigation app,”, available at, (accessed March 20, 2018).

[6] Waze Privacy Policy, available at, (accessed March 20, 2018).

[7] “Roles and Responsibilities,”, available at, (accessed March 20, 2018).

[8] Darrell Etherington, “Waze Carpool expands to the entire state of Washington,” (March 20, 2018), available at

[9] “Make the most of your commute,”,, (accessed March 20, 2018).

[10] Muthukumar Kumar, “Police officers in US are worried about Waze sharing their location information,” (Jan. 27, 2015), available at


Wikipedia: The Ultimate Crowdsourced Knowledge Tool

Student comments on Show me the Waze to go home

  1. Thanks for this great post, Hans! Waze is the perfect example of a business that has utilised crowds for value capture and value creation. Your post was very well written and laid out a lot of interesting information. One thing that I am still less clear on and find very interesting is how Waze initially managed to convince users to start contributing to the platform. It was a novel idea when it launched and felt, in some ways, like a video game. I wonder if that is part of what led to its popularity and eventual virality.

  2. Thanks for the feedback! And great question on how Waze initially built users — that’s definitely the big “chicken and egg” problem of crowd-sourcing.

    Waze started in Israel in 2006, as a crowd sourcing project (“FreeMap Israel”) to create a free digital map of Israel in Hebrew. The founder of that project, Ehud Shabtai, then began to develop the project as an app and, with the help of VC funding, was able to recruit employees and alpha drivers to begin building out maps and app services. After piloting and refining their app in Israel, in 2009 Waze launched in California (

    It looks like Waze also used prizes as incentives to attract new app users. In its “Waze across America” campaign, they offered new myTouch 3G Android phones and iPhone 3Gs to new users who downloaded Waze, sent a Waze road report, and kept Waze active until they arrived at their destination. Waze gave out 100 phones per state (

  3. Hi Hans, thanks for your wonderful post! It’s interesting that in Waze, the police is considered a road hazard. Do you think in the future it will be a problem for Waze themselves? And how do you think they can survive while Google maps also leverage the same exact idea?

    1. Hi Nandx. On your second question, I’m not as concerned about Google maps, in that Waze is a subsidiary of Google and thus data from both apps likely feed one another, rather than compete against each other.

      On your first question, here’s a reddit on the topic. Some comments note that police need to be aware/vigilant regardless of the situation, and others liken Waze to radar detectors. Some police even try to thwart Wazers by logging into the app and, when reported via other Wazers, report themselves “not there”!

      According to the Mercury News (as reported by The Washington Post), Waze has responded to police concerns with the following statement: “These relationships keep citizens safe, promote faster emergency response and help alleviate traffic congestion . . . .
      Police partners support Waze and its features, including reports of police presence, because most users tend to drive more carefully when they believe law enforcement is nearby.”

  4. Thank you so much Hans – such a well-written article. Waze is popular in Southeast Asia too, especially in the Philippines as you may know. It is interesting to see how Google Maps and Waze have different value caption strategy even though they are under the same corporate umbrella. As far as I understand, Google Maps doesn’t really care about capturing the value, if customers keep engaged in platforms offered by Google. Or maybe Google Maps also starts capturing the value in a direct way, like advertisement, as Waze is doing right now?

    1. Thanks Taka. I’ve used Waze many times in Philippines — it’s ESSENTIAL for quickly navigating Manila congestion!

      I think you’re correct that Google Maps captures value in a different way from Waze, but I think it’s more due to the separate functionality of the apps. As pointed out in class on Thursday, Waze was one of the first free turn-by-turn navigation apps on the market. Prior to that time, consumers had to pay for navigation. Waze was able to build market share (and thereby network effects) by being quickly adopted as the best free turn-by-turn navigation app. On the other hand, Google Maps seems to be focused on non-navigation searching. If I’m traveling on foot, or if I’m generally researching a certain area, I’ll always use Google Maps. On the other hand, if I’m seeking to drive from point A-to-B-to-C (etc.), I’ll always use Waze.

      This reinforces a concept from our platform module: platforms in established two-sided markets usually can successfully compete by developing a niche focus. On the other hand, it’s hard to defend a one-size-fits-all platform after the two-sided market has been established.

  5. In Public Entrepreneurship last semester, a guest speaker from Waze told the class that Google, in acquiring Waze, had promised to keep Waze as a standalone brand and business entity. On one hand, I am fascinated by the crowdsourcing model of Waze as described compellingly in your blogpost. On the other hand, I am a little curious as to why Google hasn’t been very proactive in integrating such an amazing business model innovation (especially the crowd elements) into Google map as well?

    1. Thanks for that info! I wonder if there is a BSSE element to Google keeping Waze separate (e.g., “leverage my business model” vs. “reinvent my business model”)?

      Back in 2015, Google reorganized into its current holding company structure (“Alphabet”). According to Business Insider, as of 2015 Google had acquired over 180 companies, and this was their view towards the challenges of integration: “Acquisitions succeed or fail based on integration, particularly when we are trying to do something tricky, like making sure the team stays autonomous — syncing to get the advantage of Google’s resources and yet being kept separate. That’s a complicated process…”

      This sounds like the approach Google is taking to Waze. Waze has the benefit of syncing with Google Maps resources, which helps feed Waze with better info, but Google is keeping Waze as a separate group so Waze is not hindered by integration challenges (which can slow innovation or dissuade start-ups from pursuing disruptive business models).

  6. Thanks, Hans. It will be interesting to see how Waze progresses with the adoption of autonomous vehicles. The software to determine the best route and ETA might still be useful, but I wonder if the current autonomous vehicle creators are already adopting this software into their vehicles. And users won’t really be looking at the app any more for directions as the car will be doing the driving on its own. Also, certain hazards such as speed traps are no longer relevant for an autonomous vehicle. I think Waze needs to find a relevant partnership sooner rather than later before it gets left in the dust.

    1. Interesting question Zach! While AV creators may want to incorporate navigation software into their vehicles that manage for traffic and congestion, there is still the chicken and egg problem that navigation platforms faced. What comes first? You won’t have traffic/congestion information unless you have a lot of customers providing that info (passively and actively). And customers won’t provide that info if they don’t get any value. This is why I think the network effects Waze has already captured are a good defense to AV SW — at least initially.

      Then again, on the traffic/congestion part, some innovative players might seek new solutions that are untethered from vehicles to help navigation apps. For example, I believe Verizon is looking at installing smart sensors into asphalt to develop actionable traffic information.

      But I think you’re absolutely correct about the hazard spotting functions of Waze… AV tech should capture a lot of this value creation by moving the hazard avoidance task from the driver to the AV SW.

  7. Thanks for an interesting read, Hans! I was on a Lyft during the weekend and the driver said he only uses Waze because it’s the most accurate navigating software. He voluntarily participates in submitting information to help others and he believes others will help him. I guess there’s a strong sense of community among users.
    I think Waze has the potential to become the default navigation software for drivers. Its value proposition is evolved around helping drivers navigate more easily and accurately – that does not limit only to getting from point A to point B but also how to get services like food, gas, bathroom more conveniently when on road.
    One minor concern I have is how to optimize the way drivers volunteer information to Waze, because it’s dangerous to tap your phone while driving. I, as a passenger, was worried when my Lyft driver attempted to do that.

    1. Hi KZ – I imagine it’d be fairly easy to use speech recognition to allow for audio inputs. We saw with Aspiring Minds today that this is fairly simple to develop (provided you have a good method), and I imagine the inputs that Waze would need are fairly limited (hazard types). One challenge would be to have a fast enough input system so that Waze can properly ID where the hazard is located… it doesn’t help them much if the hazard is logged two minutes later, when the hazard could be as much as 2 or more miles behind the driver!

  8. Awesome post ! Something I’ve always wondered about is the incentives model for active participation Waze has put in place. Simply earning a higher status, but with seemingly no tactical value or practical use, has always seemed very bizarre to me. Yes you have different names for your user but if you’ve ever had your user reset for some reason you’d probably see – your experience of Waze remains exactly the same. Another point to consider is the risk of distracting drivers while tapping 1-3 buttons to report an event on the road. Imho even if this takes 2-3 seconds, it is a newly generated need for the driver’s attention, much like radio, that only adds to the increased risk of a car accident. Has Waze ever responded to this risk? Seems like they depend on it.

    1. Hi – One way Waze has responded to this risk is to proactively freeze any typing/inputs on the phone. An alert pops up that says typing is disabled for drivers… but then it gives you the option to select “passenger”, and after that unlocks the typing functions. I imagine most Wazers are guilty of selecting “passenger” when they start off driving…

  9. Super interesting that Waze is moving from traffic to gas stations to Outlook, etc. Especially given that Waze is a subsidiary of Google, it will be interesting to see how far Waze will go in taking part in our lives. That being said, the Waze Carpool model worries me a bit. I wonder if it will be sustainable for drivers to pool together simply to share the cost. Unlike Uber drivers, no one is being paid any extra, so I wonder how they will continue to incentivize people to ride together in terms of logistics, etc.

  10. Awesome Post Hans! Thanks!

    I mirror some of the comments above and I was also wondering what are your views as we evolve into Smarter Cities and (Self-driving) Cars, regarding how should mapping work? Do you see it becoming a “public good” and having a sole open-platform maps where all companies can push and pull data? Or do you still see diffenent actors like waze, google maps, citymapper, etc. compiting to become the best navigating apps?

    Also I wonder how algorithms can evolve with machine learning in anticipating future traffic flows according to the “recommended” routes that apps like Waze usually suggest. Do you think that real time data and machine learning will be able to adjust to drivers or self driving cars decisiones more quickly and efficiently and adjusts routes recommendations to all other cars to make ETA the most effective? If so, how can we monetize this value creation?

  11. Really enjoyed the post. The Waze Carpool is an interesting development. On the one hand, it’s clear that they aren’t entering this business to win it. As it is, its unclear whether this is a business you can make money in in the U.S. (and that includes Uber and Lyft). However, I’d assume Waze and Google are looking at second and third order goals for this initiative. Its likely that this is some precursor to their driverless vehicles plans and will be a source for gathering route data, etc. As of now, Google has as many pieces as anyone in the race for autonomous ride sharing, except the actual ride sharing service.

    1. Hi Rob – I think you’re correct that Waze Carpool seems like a second or third order goal, likely aimed at gathering more data. Another aim may be to examine what the WTP of consumers is to trade the convenience/flexibility of driving themselves for the cheaper carpooling alternative. Waze Carpool definitely looks closer to what I imagine ride sharing with an autonomous fleet might look like. It’ll be interesting to see what customer frictions Google encounters as it continues to roll out the program…

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