by Rick Delgado
Microsoft’s recent purchase
of LinkedIn for a reported $26.2 billion may be the biggest acquisition
news so far in 2016. But Twitter is betting that its own recent
acquisition of Magic Pony Technology – a neural networks/machine
learning company – for a mere $150 million will pay big dividends down
the stretch.
Commenting on the acquisition in a recent Twitter blog,
Twitter CEO and co-founder Jack Dorsey said, “Machine learning is
increasingly at the core of everything we build at Twitter.” Dorsey went
on to say that, “Magic Pony’s machine learning technology will help us
build strength into our deep learning teams with world-class talent, so
Twitter can continue to be the best place to see what’s happening and
why it matters, first. We value deep learning research to help make our
world better, and we will keep doing our part to share our work and
learnings with the community.”
Magic Pony Technology is the third
machine-learning startup that Twitter has acquired since Madbits in
2014, which begs the question: Why is Twitter so heavily focused on
machine learning? As it turns out, there are three very good reasons.
Enhanced Video Quality
It’s
no secret that Twitter has been fighting an uphill battle to attract
and retain an active user base. In February of this year, the social
media company reported
that it lost 2 million users in the last three months of 2015. And
while a number of tech pundits have suggested various reasons for
Twitter’s slump, among the most logical reasons that Twitter has
acquired Magic Pony is to get the company out of that slump by enhancing
video quality.
That bet could pay off, because Magic Pony’s
technology is capable of recognizing patterns and textures to
automatically enhance the quality of blurry video images captured with
low-resolution cameras. By improving the quality of videos that are
shared on its site, Twitter is looking to improve the experience and
enjoyment of its users, a strategy that the company hopes will attract
more users and keep them engaged.
Real-Time News Reporting
One of the key challenges of big data analytics is to capture, process, index, and categorize vast volumes of unstructured data,
such as pictures and videos. With the acquisition of Magic Pony and its
crack team of skilled data scientists, Twitter now has the analytics
muscle to become the leader in real-time news reporting.
Armed
with the ability to collect in close to real-time all user-created video
and pictures surrounding a specific newsworthy event and incorporate it
all into a single high-quality stream accompanied by live commentary,
Twitter – or a business that licenses its technology – could become the
go-to source for breaking news. And this news would be seen through the
virtual eyes of those who are at the scene as events unfold,
constituting a compelling format that could drive huge ad revenues.
Deep Learning
Right up there with hyper-converged infrastructure
vendors, machine learning and neural networks that work like the human
brain are hot big data topics these days. And the acquisition of Magic
Pony, which specializes in machine learning and neural networks, could
help Twitter move beyond hashtags and text analytics into the realm of
deep learning. With this capability, Twitter could become an
intelligence services vendor to organizations looking to leverage the
benefits of applying machine learning algorithms to their own Twitter
streams.
In addition, Twitter could use deep learning technology to identify people, places, and things in photos and video,
profiling users for more personalized, targeted, and engaging
advertising messages. Thanks to Magic Pony’s machine learning
technology, Twitter has the capability to branch out into areas that
could prove to be far more valuable than its beginnings as a short text
comment platform.
Startup acquisitions have been and will continue
to be smart business strategies for advancing the agendas of
mega-companies such as Microsoft, Google, and Apple. With its own recent
and modest startup acquisition, Twitter has high hopes that Magic Pony
will put it in the winner’s circle.
Rick Delgado is a technology commentator and freelance writer.
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