Body Labs, a four-year-old start-up specializing in 3-D body modeling, becomes Amazon's acquisition.

Amazon has acquired 3-D body-modeling company Body Labs, the Manhattan-based start-up confirmed on Tuesday.

When reached for comment, a Body Labs representative said, “Regarding the direct question of whether we’ve been acquired by Amazon the answer is yes” and directed any further questions to the online retailer. Late Tuesday, the start-up posted a brief announcement on its web site confirming the deal and directing inquiries to its new parent company.

Amazon declined to comment.

Figures for the sale price range: Some peg it somewhere between $50 million and $70 million, while others believe Amazon paid anywhere from $70 million up to more than $100 million. The four-year-old business, which previously raised more than $10 million in investment rounds, was last valued by PitchBook at approximately $30 million.

Those numbers may be optimistic. Last year, when Electronics for Imaging Inc. scooped up Optitex Ltd., a 3-D CAD (computer-aided design) software company, it paid $52.8 million. The deal covered “$20 million upfront cash payment, $3 million of which was placed into escrow, and annual cash earnout payments over three one-year periods of up to an additional $32.8 million in total.”

According to insiders, the arrangement looks like a win-win. “Digital bodies are an interesting technological development, but it’s a difficult thing to monetize,” an industry source told WWD. If Body Labs was hunting for revenue streams, the sale may have solved some fundamental problems.

How Body Labs, or its SOMA 3-D technology, in particular, fits into Amazon’s world is even more intriguing.

SOMA, which launched four months ago, tracks motion and maps realistic 3-D body scans from 2-D photos, thanks to its “human-aware AI,” or Artificial Intelligence, plus body data and computer vision. The claims ramp up from there and run the gamut: accurate virtual fitting for retail, realistic avatars and bare-handed gesture control for gaming companies, pedestrian tracking for road safety or any other anything else developers can dream up that could benefit from detailed shape or motion tracking.

With its vast array of initiatives, Amazon can make use of the tech across its organization — especially the virtual fitting feature.

Accurate sizing has been a major obstacle for online apparel retail. The 2017 Retail Industry Trends report from PricewaterhouseCoopers’ strategy consulting group laid out a sobering statistic: For fashion apparel, “physical stores experience a return rate of about 3 percent, compared with about 25 percent for online sales.” The percentage rate was even higher for “highly fashionable or fit-critical items.” The reason: Shoppers can try on goods in a physical store, feel the fabrics or see its quality of construction up close.

Online reviewers describe some of those qualities, but they can’t tell a would-be customer how a shirt will hug his or her body.

“The deal makes sense,” said Ari Bloom, chief executive officer of Avametric, another 3-D software provider for virtual fittings and apparel. “We’ve seen firsthand how companies like Amazon are trying to move conversion rates up and return rates down.” Gap Inc. took a similar approach when it partnered with Avametric on an Augmented Reality virtual fitting app. The apparel brand introduced the Dressing Room by Gap Android app at the Consumer Electronics Show early this year.

Whatever benefit SOMA brings to Amazon’s retail business, the tech could also give a lift to the e-commerce behemoth’s fashion obsession.

The company launched Spark shoppable photosAmazon Prime Wardrobe service and a camera-equipped Echo device, which put a digital “stylist” in customers’ homes, not to mention more than a dozen fashion brands and a private-label business. The company even patented a robotic mannequin capable of morphing its shape.

Now it owns a technology that could allow designers to see how fabrics could realistically settle on a human figure without actually having to create it first. Optitex’s focus was fast fashion. Amazon’s use for Body Labs could go there — and everywhere else across its empire. 

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