IBM Watson Extends its Reach with AlchemyAPI

The field of cognitive computing is one of the key trends of 2015 for the “As-a-Service Economy” and IBM Watson has certainly been at the forefront of  publicizing and bringing this technology to the market.  As the this market develops attention is being paid in particular to how unstructured data in the enterprise can be aggregated, processed and then understood by individual cognitive platforms more effectively via natural language processing (NLP).   HfS sees 2015 as being the start of a period of significant acquisition activity in cognitive computing as these various platforms including IBM Watson take shape.

Today’s announcement that IBM is buying privately held, Denver based AlchemyAPI to extend the reach of IBM Watson into a broader pool of developers for apps around analyzing unstructured data via NLP is a move worth watching this year.

While AlchemyAPI certainly hasn’t had anywhere near the level of enterprise and commercial market exposure that Watson has had, it has still made its presence felt in the development community and with a set of initial enterprise clients, including Hearst.   These developers (in the tens of thousands) have been especially interested in the machine learning and visual recognition capabilities that are integral to AlchemyAPI.

The IBM Watson Group gets additional machine learning technologies, visual recognition capabilities and deeper access to tens of thousands of cognitive developers all while removing an increasingly capable competitor.  A sound strategic move by IBM.

Over the last year the IBM Watson Group has been actively extending the positioning of Watson to be an “As-a-Service” capability for a broad range of client industry verticals and their cognitive computing opportunities.  

Already, IBM Watson was a marketing juggernaut in the cognitive computing market of 2015, acquiring AlchemyAPI is a way to further bring along the technical capabilities of the platform to realize and extend the positioning in the market that has already been taken.

This is a bold move, one that we expect to have significant impact over the coming 12-36 months as the definition of and expectations for cognitive computing evolve.  We also believe that the addition of further NLP capabilities will make IBM Watson a potentially more interesting platform for inclusion in business process solutions than we have seen to-date.