Apple confirmed late Sunday that it was buying Israeli tech firm PrimeSense for $350 million. The announcement ended weeks of rumors and speculation over the deal.

Last July, it was reported that PrimeSense and Apple were in intense negotiations over a possible Apple acquisition.

PrimeSense developed the Kinect 3D system for Microsoft. Since then, it has developed 3D sensors for consumer electronics, cars, game devices, digital signage, medical devices, and more. The company’s sensors are installed in over 20 million devices.

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Apple, according to industry insiders, has been working on three-dimensional technology for some time now; last year, it took out patents on a method of presenting 3D content on devices without the need for glasses. If Apple wants to add 3D to its iPhones and iPads, it would need not only a 3D sensor, but also technology to enable the device to understand and apply gestures properly – a major programming task.

PrimeSense has already overcome many of the programming issues that Apple would face. The company’s technology uses depth-sensing to enable devices to identify movements and gestures, enabling the device to differentiate between specific gestures that trigger specific events — such as an arm sweep to change channels on a TV, a hand movement to change the volume, etc.

PrimeSense’s technology also enables devices to differentiate between objects like furniture, and to weed out gestures that are not meant to be picked up by the device. The technology is based on an innovative “light coding” method, which codes a scene with light from the near-infrared spectrum, interpreting actions based on where activity takes place.

PrimeSense’s technology would most likely be applied to new, smarter Apple TVs, devices which let users subscribe to Internet television and media services. Apple TV is one of the leading set-top boxes for delivering Internet content to TV sets, but has recently been challenged by Google, which released its ChromeCast device several months ago.

Although Apple TV offers more entertainment options right now (including services like Hulu, HBO, etc.), the Google device offers more flexibility in connectivity and the formats it plays — and is one third of the price of Apple TV. Adding 3D gesture sensing to Apple TVs would give the Cupertino-based company a big leg up on its Google competitor.

Times of Israel staff contributed to this report.