Apple hasn’t done well on the social media front and now according to a rumor the company is acquiring Color Labs, a multimedia sharing startup. Color allows users to create groups and within those groups, anyone who is within a certain location, can automatically add photos and videos.
The concept is intriguing and Apple appears to believe it could make an impact. The Next Web first heard the news through trusted sources and claims the startup is being acquired in the high double digits. Papers have yet to be signed, but the deal is rumored to be done.
Color Labs received very negative feedback in March of 2011 when they claimed $41 million in funding from Sequoia Capital, Bain Capital, and Silicon Valley Bank.
For an application startup that funding level was unheard of during pre-launch. Many believed it was the start of a social media bubble and thought it to be a failed investment.
The reasoning behind the acquisition by Apple could be far more than the service itself. Patents are king and Color Labs has multiple patents pending such as GPS location and battery saving, including new patents filed recently that involve sharing content among a group of devices, for example.
With competitors such as Samsung already implementing S Beam technology which allows Galaxy S III owners to share content by “touching” devices, Apple could be looking to create an easier way for iOS users to share content with each other.
Apple could also be looking to further distance itself from the Google product base. The company recently shunned its built-in YouTube player. Color could allow Apple to integrate its own brand of photo and video sharing via social integration with the next iOS release.
According to source at AllThingsD the buy price is nowhere near the “double digit” number thrown out by TNW:
“What’s really happening is that Color’s engineering team — about 20 people, comprising almost the entire company — is being “acqhired” by Apple at what’s being called a “nominal” price of something like $2 million to $5 million, according to multiple sources familiar with both sides of the situation. To repeat, there are no “double-digit” millions involved, according to many people familiar with the deal.
Apple is not buying Color’s technology, intellectual property, domain names or liabilities. Those are being left with the company, which still has considerable cash in the bank — something like $25 million — and is going to be wound down.”
Apple is rumored to be acquiring the team to help with its cloud-based services.
There has been no official word from the buyer at this time.