In a day packed with major Apple announcements, the company tackled smartphones, wearables, and payments. But there is one more sector that may be about to get the Apple treatment: Social.
According to a single well-placed source inside Apple’s engineering team, the company is poised to announce an acquisition of Dave Morin’s Path social network. To quote our source, who requested to remain anonymous because the deal has not been announced yet, “It’s almost done, if not signed already, but it’s essentially a done deal.”
If true, it would be major news for the heretofore struggling social platform that has been known more for its design and user interface innovations than for its ability to drive adoption among consumers – particularly in non-Asian markets. Apple hasn’t fared much better in the social realm historically, having flopped with its Ping social network and having made very little out of its acquisition of the team and IP from failed location-based photo social network, Color.
According to our source, this is more than just a talent acquisition, or acquihire. The Path product will likely survive the acquisition and be incorporated, in whole or in part, into Apple’s newly refreshed Messages app. That doesn’t mean that the deal will be priced like some other recent high-profile mobile communication deals, namely Facebook’s $19 billion Whatsapp acquisition and rumored $3 billion-plus offers extended to Snapchat by Facebook and Google.
Facebook paid $42 per Whatsapp user, and $33 per Instagram user before that. By comparison, Rakuten bought the far less beloved Viber for just $3 per user. With Path having somewhere in the vicinity of 25 million users at the beginning of this year, and far weaker growth and engagement than any of the above platforms, it would be lucky to command anywhere near Instagram/Whatsapp sums. According to App Annie, Path ranks just 177th among iOS Social Networking apps in the US and not among the top 1000 overall iOS apps. When Path raised its most recent round in January of this year, the company reportedly commanded a sub-$400 million valuation, well below the $500 million-plus levels reportedly sought by management. Given the trajectory it was on, exiting at that level would likely be considered a win among most Path insiders. Hell, for many Valley observers, that would be the win of the century for Path investors, many of which have all but left the company for dead.
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