Snap's latest purchase opens new commerce opportunities

Snap, the company behind popular ephemeral photo- and video-sharing app Snapchat, reportedly acquired Israeli startup Cimagine Media for $30 million to $40 million, according to Calcalist.

The deal, yet to be confirmed by either party, will give Snap access to Cimagine’s portfolio of augmented reality (AR) and camera vision technology. The startup focuses on computer vision, real-time image processing, mobile development, and international marketing. The acquisition will also give Snap the ability to build out a development center in Israel, expanding staff beyond the 20 Cimagine already has.

Snap could be looking to diversify its revenue stream ahead of its impending public offering in early 2017. Cimagine’s emphasis on marketing technology could help Snap as it looks to break into the commerce aspect of computer vision and image recognition. Cimagine is already partnered with a number of leading brands to help them market their products over AR. The purchase gives Snap an in with these companies already familiar with Cimagine’s technology.

The purchase will add to Snap’s already abundant AR offerings. Cimagine’s AR technology, which allows users to overlay objects on photos and videos, could be added to Snapchat's AR technology to add geo-filters to users’ photos and videos. But it could also be used further down the line, perhaps with Snap’s new wearable product, Spectacles. Currently, the recently launched glasses can take videos that can then be added to a user's Snapchat story. However, it’s not hard to imagine the company turning the wearable into a stand-alone AR offering — similar, but ideally more successful, than Google Glasses.

AR and VR research has been a hot topic in 2016, as tech companies look to keep up with the emerging technology.

The virtual reality (VR) market has made significant strides throughout 2016.

New VR headsets like the Oculus Rift and the HTC Vive debuted amid great consumer anticipation, while VR content launches kept pace, with Batman: Arkham VR and Chair In A Room garnering encouraging download totals.

At the same time, industry groups and conferences brought developers, investors, and content producers together, helping to further ramp up buzz in this nascent space.

BI Intelligence, Business Insider’s premium research service, forecasts shipments of VR headsets to spike by 1047% year-over-year (YoY) to 8.2 million in 2016.

Jessica Smith, research analyst for BI Intelligence, has compiled a detailed report on virtual reality that explores the highly fragmented and volatile VR market that emerged in 2016, lays out the future growth potential in numerous key VR hardware categories as driven by major VR platforms, and examines consumer sentiment and developer excitement for VR, presenting which headset categories and platforms are most poised for success in the near- to mid-term.

Here are some key takeaways from the report:

In full, the report:

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