Snap wants to boost its effort to push augmented reality smart glasses to its consumers, whether they like the glasses or not.
Last Thursday, Snap announced its latest Spectacles smart glasses. They come with built-in AR displays. They’re not for sale yet.
Spectacles aren’t that profitable. They are also largely unloved. Still, it doesn’t stop Snap from launching new Spectacles and acquiring WaveOptics that supplies AR displays.
Snap bought the said supplier for over $500 million. The deal is in cash and stock. Half of the price will be in stock upfront while the remainder will be paid out in cash over the next two years.
Augmented Reality Technology
By buying WaveOptics, it is an indication that Snap is going all-in on AR smart glasses. With the acquisition, it allows Snap to push its way into a future where AR glasses could be ubiquitous.
Facebook, Apple, Snap, and other tech giants are racing to build augmented reality devices. They believe that these devices are the next tech frontier after the smartphone is done.
AR eyewear could enable users to see virtually route directions in front of them. They could also see details about a landmark in their surroundings.
Non-Exclusive
The deal between WaveOptics and Snap isn’t exclusive. It means that WaveOptics can still provide other companies with waveguides.
But the acquisition allows Snap to get a leg up in the developing market for AR headsets.
Facebook, Google, and other tech giants are building their own waveguide tech, which powers the AR frames.
In 2018, Apple bought Akonia, a waveguide-maker, to help the iPhone maker in building its Apple Glasses that are rumored to be announced next year.
Snap and WaveOptics have been collaborating for many years. The latter is developing waveguides for the former’s line of smart glasses.
Waveguides are complex components. By buying WaveOptics, it represents the company’s investment in the future of AR glasses.
This is not the first acquisition of Snap this year. In fact, it is its fourth acquisition.
In March, it acquired Fit Analytics for $124 million. It’s an apparel-sizing analytics firm. The acquisition is part of Snap’s push into e-commerce.
In January, it bought StreetCred, which is a NY startup that builds a platform for location data. This acquisition is part of the company’s strategy in boosting its Snap Map, which enables users to publicly view snaps from a certain location and they have the option to share their location with family and friends.
$500 million investment is a huge deal. It only means that Snap believes in Spectacle’s future. As mentioned, the latest release of its Spectacles with built-in AR is the company’s fourth try.
The first-gen Spectacles weren’t a smash. The company lost $40 million in unsold inventory. Thousands of pairs are still gathering dust in its warehouses.
The second-gen and third-generation Spectactales faired better. However, they still didn’t get enough traction. They didn’t entice AR enthusiasts. It’s probably because of the higher price tags for a particular pair of glasses.
