Snapchat’s name has disappeared about as quickly as the app’s trademark disappearing photos.
The Venice, California-based company is debuting its first hardware, $129.99 video-capturing sunglasses, and renaming itself as “Snap Inc.” to reflect its new direction, the company’s CEO and cofounder Evan Spiegel told WSJ Magazine. Snapchat has been testing early versions of the gadget, called “Spectacles,” since early 2015, and the company plans to sell a limited number of Spectacles this fall. Snapchat’s new name reflects that the company is no longer only a social media service, Spiegel told WSJ.
Users can record video on Spectacles by tapping a record button on the hinge of the frames, which contain a camera. Spectacles can record videos of up to 10 seconds, with each tap recording a new clip. The glasses’ camera has a 115-degree-angle lens, which is wider than a typical camera and similar to the human eye’s field of view. The videos can be posted wirelessly to Snapchat and delivered to the user’s smartphone. To start, Snap plans to offer Spectacles in one size and three colours: coral, black and teal. Spectacles bear some resemblance to Alphabet Inc.’s Google Glass, which largely flopped among consumers.
Snap, which has 150 million daily active users, most recently closed a $1.8 billion funding round in May, when investors valued the company at about $18 billion. Snap is forecast to reach nearly $1 billion in global advertising sales in 2017, up from an estimated $366.7 million in revenue this year,according to a recent report by forecasting firm eMarketer. By comparison, eMarketer estimates that Facebook-owned Instagram, with 500 million users, will generate $1.5 billion in global ad sales this year and $2.8 billion in 2017.
Snap launched its ad business in mid 2015. The company sells ads in its “Discover” and “Stories” sections, as well as through paid geofilters and lenses. Snapchat’s Discover section, which features articles and video from more than a dozen publishers such as CNN, iHeart Radio and Cosmopolitan, generates nearly half of the company’s total US ad revenue.
Snapchat competes with a number of mobile apps, such as Instagram, Facebook and a host of younger social media players, for the eye balls of teens and millennials and ultimately, the $70 billion bleeding out of TV advertising business and onto smartphones.
Unlike Facebook and Instagram, users can’t garner “likes” on their “snaps” or comment publicly, which helps users feel less pressured to post and share unpolished content. Instagram, which has 300 million daily active users, recently launched “Stories,” which lets users post strings of photo and video clips, cloning a core Snapchat feature.