Performance based earn-out payments over the next three years could make this deal worth $155 million.
Opera Software today announced that it has acquired Skyfire Labs, a rival in the mobile browser space, in a deal that could be worth as much $155 million when all the checks are written. The Norwegian browser maker agreed to pay $50 million in cash and stocks upfront (including $8 million in cash on the Skyfire balance sheet), and will also make performance based earn-out payments over the next three years that could ultimately value the deal at $155 million.
SkyFire is a browser available on various smartphone platforms. It's claim to fame is that it can pull down Flash videos on the web, and stream them to your phone. The result is Flash video playing on phones that don't have access to the actual plugin. The app is free everywhere except on Apple's iOS platform, where Flash is forbidden. In its first weekend, SkyFire has managed to make almost $1 million, just $2.99 at a time.
All this is happening in the midst of SkyFire pulling the app in the face of a massive onslaught of users hitting their servers. The app returned, and the users were not deterred. After Apple's share, SkyFire will be making about $700,000. Hopefully they will be able to upgrade their backend.
They'll probably need it too. Apple doesn't look to be backing down from their no-Flash policy. For the time being, the only way to get Flash video on the iPhone is with workarounds like SkyFire. Have you tried SkyFire on iOS? Is it worth the $2.99 price tag?
Skyfire proved what everyone outside of Apple have known all along: Apple users want Flash. Just hours after Skyfire offered up a Flash-compatible mobile browser in the App Store, it had to be taken offline because of overwhelming demand.
"We are going to open batches of downloads for new users over the coming days," Skyfire CEO Jeff Glueck said in a blog post last week. "The first batch will be in a few minutes on the Apple App Store. It will be first come, first serve.
"Due to overwhelming demand, we are taking this approach because Skyfire believes a good user experience should come first, and we would rather have fewer, happier customers, and add new users as we can support them. We will open the first batches to U.S. users only, with additional country support to follow shortly."
It took Skyfire just five hours to sell out of its initial batch. Skyfire 2.0 is a full-fledged browser based on the same WebKit core used by Safari. It sidesteps the whole Flash issue by translating Flash videos to the native iPhone media player using the H.264 codec.