Snap Inc. has a hardware division, but the only tech product you can buy is a pair of sunglasses. That could soon change.
Snapchat’s parent company has bought Zero Zero Robotics, which currently sells a selfie-taking drone called Hover Camera at Apple retail stores and online, according to two sources familiar with the situation and multiple communications about the acquisition observed by Mashable.
A separate source with direct knowledge of the matter confirmed the companies are in talks but denied that the deal has been finalized.
The Information reported in August the two companies were in talks regarding an acquisition. Mashable has learned the deal officially closed this summer, according to two sources with knowledge of the deal, and that Snap Inc. has not publicized it and has not allowed the team behind Zero Zero Robotics to speak out about it.
Snap declined to comment. Zero Zero Robotics did not immediately respond to a request for comment.
This secrecy is typical of Snap, a company that has kept the majority of its other acquisitions quiet until they were outed by the press or until Snap released a feature that was developed, in part, through that acquisition (for example Snap Maps).
The terms of the deal were not confirmed, but Techcrunch reported that the deal was for between $150 million and $200 million.
Snap Inc. owning Zero Zero Robotics could mean a new feature for Snapchat. The experience could be quite like Spectacles where users can take 10-second videos and upload them to their account. Hover Cameras can take selfies or other aerial videos, which users could later share on Snapchat.
The deal also points to Snapchat’s evolution as a “camera company” beyond smartphones, a step that could help the company differentiate itself from competitors like Facebook and Instagram.
“Snap is unpredictable. Nobody really knows what they do.”
Differentiations from Facebook are something that analysts and investors are begging for from Snap Inc. They’ve watched the stock fall from $27 per share to below $14 as Facebook releases similar products, the most similar being “Instagram Stories” and the latest being Facebook Watch, a competitor to Snapchat Discover. All of those features compete for digital advertising dollars.
“Snap is unpredictable. Nobody really knows what they do. They have this app, but they call themselves a camera company,” said James Brumley, analyst at InvestorPlace.com. “For now, they are not a camera company. They are in ad sales.”
For now, hardware is only a small fraction of Snap’s business. Spectacles comprised the majority of Snap’s $8.3 million in “other” revenue reported in May for the first quarter of 2017. Snap generated $149.9 million overall for the quarter.
“[Spectacles’] $8 million doesnt really compare to [Snap’s] ad revenue. It doesnt hurt, but if they are going to become a hardware company and start selling cameras, they need to do a lot more it,” Brumley said.
With Hover, Snap is bringing in another revenue source beyond what it makes from digital ads within Snapchat and from selling Spectacles. Hover sells for $499.95 online on Apple.com and in Apple retail stores. If it keeps the Apple partnership, it also gives Snap another point of sale option.
Some of Snap Inc.’s most notable features have been constructed via acquisitions and then integrated into its core product. We compiled some of Snap’s acquisitions, matched with their similar products:
Vergence Labs Spectacles
Bitstrips Bitmoji in Snapchat
Vurb Search bar
Placed Location tracking in ads
Zenly Snap Maps
Cimagine Augmented reality tech
Flite Ad tech
Seene / Obvious Engineering 3D selfies
Scan.me QR scanning
AddLive video chatting
Snap also recently acquired the team behind Strong.codes to support cybersecurity efforts.
Zero Zero Robotics would not be Snap’s first acquisition of a drone company. Snap acquired Ctrl Me Robotics, a Los Angeles-based drone manufacturer, for under $1 million, according to BuzzFeed. Ctrl Me also worked with movie studios to produce drone footage.
More From this publisher : HERE