Apple acquired Matcha for its proprietary recommendation algorithm

“News broke that Apple had acquired Matcha, a video programming recommendation site, earlier this week. It’s not surprising, despite the company’s relative unknown status and small amount of total funding: Apple makes a number of smaller, strategic acquisitions and we don’t find out about some until well after the fact,” Darrell Etherington reports for TechCrunch. “With Matcha, however, there’s a very good reason Apple came calling, and that has to do not with talent but with product.”

“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,” Etherington reports. “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.”

Etherington reports, “There are a number of companies out there trying to do what Matcha was attempting, including Squrl, Fanhattan and Dijit to name just a few… Matcha was acquired after testing numerous approaches to generating recommendations, right at the point where it had refined its algorithm such that it saw an explosion in user growth, according to our source… 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.”

Read more in the full article here.

Related articles:
Apple gears up for the video discovery wars – August 15, 2013
Apple acquires second-screen TV/video app – August 13, 2013


    1. Disagree. The amount of money is not based on what Apple has in house, but the value of the product Matcha had created and what it could do for Apple v. Apple building its own similar product.

      It also reflects Matcha’s owners’ determination of the value their product had, because they agreed to sell it for that price.

  1. That is the diff between MSFT and APPL.

    AAPL is like a no-name well educated middle class boy/gal all grown up, become really wealthy, yet still really down to earth, and spend $$ wisely.

    On the other hand, MSFT is like some no-name boy/gal suddenly got sh*t load of $$ from some unknown distant relative, become really wealthy, and spend $$ like no tomorrow.

    Do you care to guess which one’s wealth will last longer?

    my 2 cents…

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