In the long run, Google certainly wants to see the market for mobile ‘finding’ and location awareness to move right along, but I suspect that they never really wanted to directly be in the business of running this application. In 2005 I suspect they instead wanted to motivate other market participants to develop more on this front, and keep Dodgeball as a hedge in case the market didn’t act accordingly… and if this was the case, they were certainly successful as this long list of mobile social networking applications will attest to. Google can now sit back and hope that they all adopt Google Maps as the underlying platform, and all will be fine.

What Google should do now is sell back everything that was formerly Dodgeball back to its founders for some small sum, still take the tax benefits on the “loss”, and let the original founders try to take the service to the next level on their own dime… it sure beats shutting it down and will ultimately benefit Google to have the original innovators working hard to continue to develop the service, and letting them pick up where they left off will move things in the space along quicker than making them start from scratch.

Highly doubtful this will happen, because it will look like a “failure” to the rest of the world, but it makes sense to me.