Although the vision of AI being ubiquitous in our lives has taken some time to become reality, it is now true to say that AI is present in all facets of our daily lives – smartphones, Alexa, Google’s Echo & Duplex, Intelligent Voice Recognition, Robotics are all powering adoption. The list of applications is endless and continues to expand daily, with healthcare, HR, retail and agriculture being just some of the major beneficiaries.
However, despite the increasing clamour around Artificial Intelligence, the technology is still regarded by many as a Software Tech niche in its infancy and therefore, yet to reach its full potential. This current status quo is now driving a voracious appetite for investment in AI start-ups, as the large tech players compete to acquire the most innovative – and lucrative - AI solutions. Add to the mix a dearth of AI talent and the likes of Google, Amazon, Microsoft, Facebook and Twitter are now in a race to fund further innovation and grab market share in this increasingly important niche.
Recent AI Acquisitions
The AI space continues to be a ‘hot’ hunting territory for acquisitive companies - Witness Paypal’s recent (May ’18) acquisition of start-up, Jetlore, provider of AI prediction technology for the retail industry and Datawatch’s acquisition of Data Science Platform provider, Angoss Software for $24.5 million in January ’18. Also, Facebook’s even more recent acquisition, for a reputed $30 million, of language processing start-up, Boomsbury, in a bid to combat the fake news proliferating on the Social Media channel.
According to latest research from Hampleton Partners, there are three key AI sub-sectors which have shown particularly impressive growth rates over the past 2 years: machine data analysis, natural language processing and machine vision.
Machine data analysis start-ups are attracting the majority of buyers, accounting for almost half of all deals (49 percent). Machine data analysis includes business and data analytics, forecasting models, big data machine learning, statistics recognition and predictions.
AI Acquisition History
With its Acquisition of Siri in 2010, Apple was the first of the big players to make the foray into AI. Google took another 2 years to follow suit, acquiring CleverSense in 2012, followed by DNN Research in 2013 and DeepMind in 2014. After which, the pace of Google’s AI acquisitions has continued to accelerate, with a total of 14 acquisitions to-date. Apple has also continued its AI acquisition momentum, with Amazon, Facebook and Intel also taking up the mantle.
It is noticeable, when comparing numbers of AI acquisitions over the past 8 years, that the overall trend for acquiring AI start-ups is increasing in velocity in direct relation to both the level of available innovation and heightened consumer appetite for the technology.
VC Investment in the AI Market
VC investment in AI has been a prominent feature driving the sector’s impressive growth, and bodes well for the long-term evolution of the sector as well as future CEO/owner exits. VC investments have essentially been concentrated on robotic automation, autonomous vehicles (AV) and predictive analytics.
Current Applications in the Business World
Although many organisations have yet to fully embrace AI, others have already done so whole-heartedly and are already reaping the benefits via chatbots, text, video and audio recognition (Read our earlier article on the subject)
For example, AISense’s technology includes automatic speech recognition, speaker identification and separation, speech-and-text sync, deep content search and natural language processing. Users can see what was said, when and by whom and the output is shareable.
Other AI solutions enable the user to track equipment and schedule maintenance/repairs as necessary, as well as tracking individual behaviours, health statistics etc.
The Future of AI
There is a growing sense that the natural progression for AI technology is towards creating integrated solutions – For example, combining robotics with increasingly adept AI personal assistants to create walking, talking robots with the ability to run errands and do chores - The long-mooted “Holy Grail” for AI.
Robots have been used for decades in the motor and manufacturing industries, to do the ‘heavy lifting’ – so-called, ‘one-trick ponies’ who perform a specific, pre-programmed task or tasks. With the advent of IoT and AI, however, the role of robots has changed forever. They are now designed to be collaborative and problem-solving entities, interacting with humans to drive efficiencies and therefore, cost-reduction.
We have not quite reached the long-promised, ‘AI Utopia’ but, as creations such as Google’s Duplex and IBM’s Watson demonstrate, we are fast approaching it.
The increasing pace of innovation and almost universal adoption of the technologies will create new business paradigms and boost global growth across all sectors, while convergence of the market though ongoing acquisitions will drive new efficiencies.