Reportedly, Apple Inc. (AAPL - Free Report) has acquired indoor mapping application technology provider WiFiSLAM for approximately $20.0 million. The acquisition, first reported by the Wall Street Journal, was later on confirmed by Apple, although it denied providing any further details.
WiFiSLAM application enables smartphone users to identify their location using Wi-FI signals, within 2.5 meters accurately. Due to its accuracy, the technology has been quite popular with indoor mapping developers. The acquisition is expected to boost Apple’s location-based mapping initiatives going forward.
Apple has been using Google maps in its iOS-based devices, contemplating entry into the market for a long time. Despite making a number of acquisitions that include Placebase (Sep 2009), Poly9 (Jul, 2010), and C3 Technologies (Aug 2011), Apple released its mapping application with iPhone 5 in 2012.
However, the botched up service received a fair bit of criticism, primarily due to inaccurate data. Since then, Apple has been focusing on improving the service and the WiFiSLAM acquisition will significantly help it in this regard. Moreover, the acquisition will help Apple to enter the indoor mapping market, where Google already has a strong hold.
Additionally, the WiFiSLAM acquisition will enable Apple to develop applications that will help retailers to track customers’ in-store activity on a real-time basis. This will help retailers to find ways to improve customer engagement, which will ultimately boost sales. Most importantly, retailers can use this data to promote their products on social networking sites such as Facebook (FB - Free Report) .
WiFiSLAM technology can also be used by Apple to enter the location-based social networking market, which emphasizes on discovering users within close proximity. The market is expected to grow to $1.9 billion in revenues by 2016, which represents a huge opportunity for Apple in our view.
Apple continues to face significant competition from the likes of Samsung, and Amazon.com (AMZN - Free Report) in most of the markets it operates. However, lack of product innovation casts a shadow over Apple’s growth opportunities in the near term.
Currently, Apple has a Zacks Rank #3 (Hold).