Apple’s acquisition this past week of Turi, a Seattle machine learning company that has its roots in the open source GraphLab project, brings to six the number of deals Apple has made this year that have gone public. So while Apple’s $2.5 billion in R&D spending during its recently completed second quarter represented a 25% increase over the year-ago period and indicates that Apple is building plenty of futuristic technology in-house, the company continues to buy startups at roughly the same pace it has for the past three years, during which it has snapped up 9 to 15 businesses annually – at least that we know about.
The iPhone and Mac maker is notoriously cryptic when it comes to announcing acquisitions, so it’s tricky to say precisely how many companies it has actually bought, with confirmation sometimes leaking out months later in required financial disclosures. Even in the case of Turi, Apple wasn’t proactive about announcing the supposed $200 million deal, but did confirm the transaction to Recode after GeekWire broke the story. Apple hasn’t formally announced an acquisition since its $3 billion Beats Electronics blockbuster in 2014.
As for Turi, its mission is to help organizations build intelligent and scalable applications, and its offerings can be hosted on premise or in the cloud. Sample uses cases include recommendation engines, fraud detection and sentiment analysis. Apple, which has been working to make Siri more powerful and open (as demonstrated at its recent Worldwide Developers’ Conference), could benefit from additional machine learning and AI technology via an acquisition such as that of Turi.
"As you can see from the latest acquisition of Turi by Apple, the focus has been shifting from a consumer product company to an analytics company," says Vineet Asthana, managing director at investment bank Berkery Noyes. "Turi is a machine learning and predictive analytics company, which utilizes data science and algorithm based applications to predict consumer intent. It’s a big data play with a software platform. Apple is competing with Amazon and IBM in that space. IBM has Watson, which is gaining popularity and Amazon has Alexa. Data science is where the technology companies are looking to grow further."
Apple has been pretty aggressive over the past year in buying companies that have artificial intelligence expertise. These include Perceptio, known for its image recognition technology; VocalIQ While Apple hasn’t gone on a machine learning and AI buying spree, last September it did pick up both Perceptio, which was working on AI and image recognition technologies for phones, and VocalQ, a speech recognition startup. In January, Apple added Emotient, which uses AI for emotion recognition.
Apple’s other acquisitions this year have been all over the map:
*LearnSprout, which makes software for schools to track student performance
*FlyBy Media, an augmented reality company started in 2010 that had worked with Google on its Project Tango.
*LegbaCore, an OS firmware security firm that OK, Apple technically bought in November, but word of the deal didn’t leak out until February of this year.
*Carpool Karaoke TV series based on The Late Late Show with James Corden’s popular musical segment. This purchase belongs to Apple Music, which will distribute the unscripted show.
Forrester Principal Analyst Michael Facemire says that "Outside of the Carpool Karaoke purchase, the rest show an expansion of the business into broader digital experience areas," including machine learning and augmented reality. "In the very near future, digitally interacting with consumers isn’t just a mobile play, it’s a multi-channel play," he says.