Thanks (largely) to Google, Apple’s business is no longer just about selling phones, tablets and laptops, but about selling an entire experience for which all those devices are just the access point. Data is a key part of that experience, and Apple doesn’t generate a whole lot of it on its own. That’s why its acquisition of Twitter-data specialist Topsy on Monday potentially makes so much sense.
If you think about the landscape of companies whose platforms span devices, applications and services — a collection that pretty much includes Apple, Google and Microsoft — one thing that stands out is how much data the latter two are generating compared with Apple. Microsoft has Bing, Hotmail and Xbox. Google has search, Gmail, Google+, YouTube, Zagat and more. Apple has Siri and little else (unless you count iCloud or Safari, which relies on external search engines) really comparable to those other two companies in terms of generating data about what users are looking for and how they’re using using language.
All that data helps Microsoft and Google do a lot of things. They’re analyzing search queries, social posts and comments to constantly improve their natural-language processing capabilities and search algorithms, which in turn leads to better speech recognition, translation services and search experiences. They’re analyzing images, videos, and even body movements (with Kinect) to further improve capabilities around computer vision and image recognition.
Microsoft has acknowledged the importance of Bing to its greater vision, even if the search engine never becomes a real threat to Google’s dominance.
There’s a social media angle, too, with Google presumably viewing Google+ in the same manner Microsoft views Bing. Google+ gives Google the ability to filter its users’ experience through a social graph and broader trends about what’s popular, and gives it an organic method of harvesting that data to further its goals around text and behavioral analysis.
All of a sudden, Siri doesn’t seem like such a competitive advantage.
Assuming its right to access the Twitter firehose transfers to Apple, Topsy helps Apple close this gap — to a degree. Topsy has data for the entire history of Twitter, as well as firehose access to Twitter data going forward. So Apple already has access to a huge corpus of Twitter data that can help with everything from natural-language procesing to trend analysis. Theoretically, Apple could shut down Topsy tomorrow, keep ingesting that data stream from Twitter and keep growing its database without having to pay a third party. (While Topsy focuses on historical data, Datasift and Gnip focus on real-time data, including from sources outside of Twitter, and likely would have cost more to acquire.)
And Apple certainly has services that could benefit from this data, including Siri, iTunes and Apple TV. Assuming Apple uses it to its fullest advantage, Topsy’s data is a way of ensuring Apple understands what people are talking about and what they mean. (If Topsy’s team has some specific skill sets around social media analysis, Apple also now has a group of employees to lead this charge.) This could help Apple provide a better user experience by improving its recommendation algorithms, highlighting (or predicting) trending media and making Siri work even better. The company certainly is trying to hire a lot of data scientists, analysts and engineers.
Twitter has been touting its role as a trend maker and de facto ratings system for television, and Apple might be able to capitalize on that positioning, too. Rather than relying on the data Twitter releases, though, Apple could focus on the data that’s important for its ends and perhaps use that to help secure rights around content licensing and other deals.
Granted, this is a lot of speculation just hours after the Topsy acquisition was reported, but it seems hard to believe Apple paid a reported $200 million for a company just to keep tabs on how people are talking about the new iPad on Twitter. Gigaom is hosting its Structure Data conference in March with a major focus on how companies are using data to distinguish their products and create entirely new user experiences, and nowhere is that trend stronger than in the web world.
Google and Microsoft are generating lots of data to help make their companies the place to go for mobile, movies, music, collaboration and just about everything else, and they’d rather consumers not do any of that on any device bearing an Apple logo.
Feature image courtesy of Shutterstock user watcharakun.