TikTok parent company ByteDance has acquired Chinese virtual reality (VR) startup Pico. The company sees VR as an “emerging” next-gen technology, terming this acquisition as a “long-term investment”. It didn’t share the terms of the deal though.
Pico’s “comprehensive suite of software and hardware technologies, as well as the talent and deep expertise of the team, will support both our entry to the VR space and long-term investment in this emerging field,” ByteDance said in a statement to CNBC.
According to research firm IDC, Pico was the third-largest VR headset maker globally in the first quarter of 2021, only behind Facebook’s Oculus and compatriot DPVR. Its Neo lineup of low-cost standalone VR headsets is fast growing in popularity, with shipment volume growing 44.7 percent year-on-year (YoY) during that period. The company is certainly no newbie to the VR space. ByteDance is now looking to make a name for itself in this space with the Pico acquisition.
ByteDance acquires Pico to diversify its product portfolio
ByteDance’s TikTok has become a household name globally. It recently overtook Facebook as the world’s most downloaded app. TikTok is now synonym with short-form vertical videos. But as its popularity gradually reaches the saturation point, ByteDance is starting to expand to other product lines to diversify its business.
In March this year, ByteDance entered the video games industry with the acquisition of Chinese gaming studio Montoon. It even released a smartphone back in 2019. The China-exclusive Jianguo Pro 3 was launched under the Smartisan brand, a Beijing-based consumer electronics company. ByteDance had acquired some of Smartisan’s patents and employees.
The Pico acquisition now marks another major step for ByteDance towards diversifying its product portfolio. While Pico mostly operates in China, where Facebook’s Oculus VR division doesn’t, it is slowly expanding its presence globally. Its latest offerings, Pico Neo 3 Pro and Neo 3 Pro Eye will be reportedly available in North America and Europe in the coming months. So the Chinese company will now be competing directly with Oculus, which currently captures almost two-thirds of the global VR headset market.
Companies like HTC and Sony are also expanding their VR portfolio as the tech becomes more accessible by the day. Apple is gearing up to make its first foray into the industry as well. It acquired California-based startup NextVR in May last year. ByteDance is now entering the VR industry with Pico and is very optimistic about it.
“We are optimistic about the future of VR and its alignment with our mission,” a company spokesperson said.