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Extended negotiations between Facebook and the social-GPS app Waze over an acquisition have fallen apart, AllThingsD reports.

Facebook was reportedly in deep talks with Waze over the past few months to acquire the company for around $1 billion. But we’ve also heard that Google and other suitors were also stepping up with their own offers. It seemed like a bidding war was on the horizon for Waze, which offers apps that drivers use to crowdsource traffic conditions.

According to All Things D’s sources, Waze and Facebook couldn’t agree on whether Waze’s Israel-based engineering team would have to move to Facebook’s headquarters. Waze’s reluctance to move would be understandable, as leaving Israel would be almost like leaving its home turf. With $67 million in funding and 45 million users, it’s one of the most successful startups founded in Israel.

It’s understandable why Facebook would be interested in Waze — it doesn’t yet have any decent mapping solution, and Waze’s technology is inherently social. Ultimately, Google always seemed like a better fit for Waze. Google’s extensive mapping experience means that Waze could continue to focus on improving its service, and while there’s the danger that Google may shut down Waze’s apps, the technology would be far more useful as a part of Google’s own navigation apps.

As Guy Regev, one of our commenters, points out, Google also has an R&D center in Israel. That means there would likely be less of a fight about relocating Waze’s Israel team to California.

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