May 29, 2015 / 2:24 PM / 2 years ago

Apple buys German augmented-reality software maker Metaio

A man looks at his Apple iPad in front an Apple logo outside an Apple store in downtown Shanghai March 16, 2012. REUTERS/Aly Song

FRANKFURT (Reuters) - Apple Inc (AAPL.O) has acquired Metaio, a German company whose technology melds real-world imagery and computer-generated elements into moving video presentations, according to a corporate filing.

The terms were not disclosed.

Metaio’s previous investors included Westcott LLC, the investment vehicle of entrepreneur Carl Westcott, the founder of floral delivery firm 1-800-Flowers (FLWS.O), and Atlantic Bridge, a Silicon Valley-based growth equity technology fund.

A document filed with a Munich court showed that Apple is now the company’s sole shareholder.

Metaio’s augmented-reality software is used in applications in retail, industrial and automotive markets.

Metaio technology is used to create virtual product showrooms and by retailers such as IKEA [IKEA.UL]. It has also created visual manuals for repairing complex industrial or automotive equipment.

Augmented reality is software that overlays text or graphics on real-life images and objects, typically in video. The result can be viewed on TV displays, smartphones, tablets or dedicated eye-goggles. It differs from virtual reality, which replaces real-world views with more or less completely simulated ones.

Steffen Sorrell, an analyst with technology market research firm Juniper Research, said Apple, which builds custom computer chips it uses in a range of products, could incorporate Metaio’s intellectual property to differentiate its products.

This could give Apple a jump on rivals who are working to develop augmented reality semiconductors but remain at least 18 to 24 months away from delivery, the analyst said.

This technology was co-developed with ST-Ericsson, the former joint venture between mobile network equipment maker Ericsson (ERICb.ST) and chipmaker STMicroelectronics (STM.PA).

Potential applications using Metaio’s low-power consumption technology could include mobile handsets and or smart-glasses, Sorrell speculated. In mobile phones, the Apple-Metaio combination could pose a challenge to current market leader Qualcomm (QCOM.O), which owns augmented reality maker Vuforia.

Metaio executives didn’t respond to requests for comment and Apple issued a statement but provided no details. “Apple buys smaller technology companies from time to time, and we generally do not comment on our purpose or plans,” the statement said.

Westcott and Atlantic Bridge were not immediately available to comment.

The roots of Munich-based Metaio go back to German carmaker Volkswagen (VOWG_p.DE), where Thomas Alt, its co-founder and chief executive, began developing augmented-reality applications in 2000.

Jupiter estimates that augmented-reality technology used in enterprises will increase tenfold to $2.4 billion from $247 million last year. Other companies in the emerging field include France’s Total Immersion and UK-based Blippar, which last year bought Layar from the Netherlands.

Additional reporting by Eric Auchard; Editing by Larry King and Susan Thomas

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