IBM Watson Group Buys AlchemyAPI To Enhance Machine Learning Capabilities

IBM Watson, the artificial intelligence platform made famous by beating the three best Jeopardy! champions ever several years ago, bought Denver-based AlchemyAPI today. It did not reveal the purchase price.

The acquisition gives Watson a key piece of machine learning technology. The deal also gives it access to community of over 40,000 AlchemyAPI developers, who are building cognitive apps, which IBM defines as “systems that learn and interact naturally with people to extend what either humans or machine could do on their own.”

This is a natural extension of what Watson is doing around artificial intelligence and natural language processing.

Stephen Gold, VP at IBM Watson Group says the newly purchased company processes billions of API calls each month across 36 countries and eight languages, which could at least partly explain why the Watson Group was so enamored with it.

AlchemyAPI has also been seen as a viable competitor with the Watson platform, so by buying it, IBM takes it out of play and gets the technology and community as part of the deal.

“From a technology perspective, AlchemyAPI’s deep learning platform will augment Watson’s ability to identify information hierarchies and understand relationships between people, places and things across both structured and unstructured data,” Gold told TechCrunch in an email.

The purchase also further enhances what Watson can currently do by giving it the ability to take advantage of visual recognition technology currently missing from the Watson platform offering.

“AlchemyAPI has advanced visual recognition technology that can automatically detect, label and extract important details from image data,” he said.

After the Jeopardy! experiment wowed audiences, IBM was left with questions about how it would monetize Watson’s intelligence in a commercial platform. It solved that when it created Watson in the cloud, a set of Watson services developers could tap into. Recently it consolidated those services in what they call “The Watson Zone” on the IBM BlueMix platform.

BlueMix is IBM’s Platform as a Service offering, and the Watson Zone includes 13 services developers can access as they create applications. IBM reports that before buying AlchemyAPI, developers had created over 7,000 applications on top of Watson. This purchase gives IBM a much broader developer community to tap into moving forward.

The AlchemyAPI purchase should also help expand Watson’s cloud development platform giving third-party organizations the ability to create new businesses and business applications on top of the Watson platform using the capabilities in AlchemyAPI.

The deal gives the AlchemyAPI community access to a much broader set of services offered within the IBM cloud stack including SoftLayer Infrastructure as a Service, additional Software as a Service offerings and BlueMix for hosting as well as developing the applications. IBM also offers a marketplace where developers can sell the applications they create.

But just because IBM will now own the AlchemyAPI technology is no guarantee that the community will want to be part of IBM. What the deal does is give it access to these developers. It’s up to IBM to find a way to keep them as customers after the deal closes.

AlchemyAPI was founded in 2005 and launched in 2009. It received a total of $2M in one Series A round in February 2013.