(Bloomberg) -- Meta Platforms Inc. is considering whether to acquire AdHawk Microsystems Inc., a Canadian developer of eye-tracking technology for augmented and virtual reality headsets, according to people familiar with the matter.
Most Read from Bloomberg
AdHawk has been working with investment bank Moelis & Co. as it fields interest from Meta and other suitors, said the people, who asked not to be identified because the matter is private. Meta, the owner of Facebook, Instagram and WhatsApp, is considering making a formal offer in the next few weeks, one of the people said.
The potential takeover would further Meta’s ambitions in virtual and augmented reality. The company is already the leading seller of VR headsets, technology that is key to its plans to build the metaverse -- a collection of interconnected online worlds.
There’s no guarantee that Meta will end up bidding, and the Waterloo, Ontario-based startup could decide to stay independent. It also remains in talks to receive additional funding, and at least four other companies are looking at the asset, according to the people.
Representatives of AdHawk, Meta and Moelis declined to comment.
AdHawk has developed what it calls MindLink, smart glasses that can track users’ eye movements to understand their behavior and neurological health. The $10,000 glasses are designed for research purposes rather than consumers. But the underlying technology could be useful to Meta and other companies looking to add tantalizing new capabilities to augmented reality glasses.
AdHawk says its technology differs from competing offerings because it’s able to track eye movements using a compact and power-efficient system rather than cameras. It also says its approach is more accurate for use in the field and can capture hundreds of high-quality data points per second.
The technology could allow augmented reality app developers to improve their software by anticipating where a user may look next and reacting more quickly, according to the company. AdHawk says the approach may have applications for health, gaming and day-to-day device operation.
Meta plans to integrate eye-tracking functions into a high-end mixed-reality headset dubbed the Meta Quest Pro, but that technology will likely rely on cameras. The device will combine virtual reality with augmented reality, which overlays data and digital images on top of real-life views.
Meta, Apple Inc. and Alphabet Inc.’s Google are also all working on stand-alone AR glasses -- everyday devices that users could wear more like regular frames. Meta has already confirmed plans to launch such glasses within a few years, while Google recently announced a public testing process for a future product.
Apple, meanwhile, is planning to launch a high-end mixed-reality headset next year, but it’s also hoping to have AR glasses ready within a few years, Bloomberg News has reported. Existing systems are too large and power-hungry to fit into future stand-alone AR glasses, which is why that technology is further out.
AdHawk, whose investors include the venture capital arms of Samsung Electronics Co., HP Inc. and Intel Corp., has raised nearly $17 million in funding, according to Crunchbase.
Most Read from Bloomberg Businessweek
©2022 Bloomberg L.P.