Microsoft Buys Digital Pen Producer N-trig: Report

Microsoft's reported purchase of N-trig, the company behind its Surface Pro 3 pen, follows years of collaboration.
6 Microsoft Acquisitions: What Do They Mean?
6 Microsoft Acquisitions: What Do They Mean?
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Microsoft is reportedly acquiring digital pen producer N-trig. The Israeli company thought up the pen that accompanies the Surface Pro 3.   

Financial terms of the transaction have not been disclosed, but Israeli news provider Globes Online writes that market sources value the acquisition at $200 million.

N-trig has recently fallen into financial troubles, Globes reports. Last year the company cancelled an IPO planned on the Tel Aviv stock exchange, and as of June 2014 it had lost $117 million, with a negative cash flow of $4.4 million from ongoing operations earlier that year.

Should the deal go through, it would be Microsoft's seventh purchase since November 2014. This acquisition comes shortly after the news the Microsoft has officially bought calendar app Sunrise, which is expected to enhance the current calendar capabilities of its recently released mobile Outlook app.

Microsoft previously invested in N-trig, which has raised $130 million over the course of eight rounds. The Redmond giant owns 6.1% of its digital pen supplier, reports Reuters, and signed a deal last year to integrate its pen into the Surface Pro 3.

Following the acquisition, most of the 190 employees at N-trig will be joining the team at Microsoft Israel. There, they will work in a new research and development center.

It looks like Microsoft is strengthening its focus on digital pen technologies. Panos Panay, the chief of Microsoft's Surface Hardware group, said in a recent interview with the Wall Street Journal that the goal is to ultimately develop technology that enables a Surface and digital pen to function like a piece of paper and traditional pen.

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While he acknowledges that this is a work in progress, Panay is adamant that people will begin using the digital pen more frequently to take quick notes, design, and create. His role, he claims, is to remove the digital nature of writing on a screen to make the process more appealing.

Will that eventually happen? It's hard to say, but no doubt digital pen technology has become far more advanced. With its acquisition of N-trig, Microsoft is in an advantageous position to explore the interface and software improvements necessary to take digital pens to a new level.

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