by Brent Dirks
August 15, 2013
Just days after Matcha’s acquisition was made public, we’re beginning to hear a little more on why Apple purchased the video discovery startup. TechCrunch has an interesting piece with some more inside information. Interestingly, according to the site, Apple paid significantly more for the company than was first reported:
First of all, it’s worth noting that according to two very reliable sources close to the matter, the purchase price was not the $1 to $1.5 million previously reported, but was instead at least eight figures and likely between $10 and $15 million. Nor was it an acqui-hire; this was about the product Matcha built and about the specific recipe for video recommendations it put together via its proprietary algorithm, according to one source close to the matter.Apple also picked up the company because its technology was the best in its class:
It was Matcha’s user acquisition and user engagement strategy that Apple was interested in, according to one of our sources, since the acquisition happened just after Matcha had completed a round of vigorous A/B testing and had “found the answer” to rapid user growth and time spent in app. Matcha’s pairing algorithms that drove the right content to the right users simply worked best of any other apps competing in that space, the source affirms.And while the technology obviously would make a good fit for the long-rumored Apple TV, Matcha will apparently help Apple in other areas as well:
It’s tempting to draw the conclusion that this is tied directly to Apple TV, but the acquisition is perhaps better thought of along the lines of Apple’s previous pick-up of app recommendation service Chomp. Surfacing the best video content for users has benefits beyond just the Apple TV, for Apple’s media ecosystem in general, and it sounds like the recommendation algorithm was the key driving factor here, rather than any one particular platform ambition. But Matcha’s ability to unify recommendations across content sources definitely sounds like a good mix for a next-generation Apple TV user experience, and our sources agreed on that as well.It will be interesting to see when or if Matcha's technology actually makes it into an Apple product. Hopefully, this is another step closer to Apple releasing its standalone television, or even an upgraded version of the current box.