Google acquires DeepMind (artifical intelligence)

Companies in Relationship

DeepMind, Google

Deal Facts

Initial Announcement Date: 1/14

Consideration: $625 million in cash; Source (Mail & Guardian)

Google acquires DeepMind for a reported $625 million. DeepMind is an artificial intelligence company that builds learning algorithms for applications such as recommendation systems for e-commerce. The company was founded by neuroscientist Demis Hassabis (former chess child prodigy and master gamer), Jaan Tallin (Skype and Kazaa developer), and Shane Legg (researcher).

DeepMind reportedly has a team of at least 50 people and had secured over $50 million in funding.

Strategic Implications

DeepMind was reportedly competing with Google for talent.

Google's acqui-hiring of Deepmind will help it compete against other players focusing on deep learning. Facebook has recruited Yann LeCunn (former NYU professor) to head the company's artificial intelligence lab. IBM is investing $1 billion in its Watson supercomputer division that is working on deep learning. Yahoo has acqui-hired the LookFlow team to lead its deep learning initiative.

In 2012, Google hired futurist Ray Kurzweil as a director of engineering, who is working on machine learning and language processing. Reportedly, DeepMind's technology will first be built into Google's search systems, perhaps later adding value to its robotics division.

Deepmind algorithms are likely to be used to tackle contextually sensitive and complex situations that require lots of data mining. The acquisition may well push forward predictive analytics for Google Now. For example, Google Now can crawl your Gmail Inbox to determine when a package will arrive. It can also read your emails to find out when your flight is delayed thanks to the data from Google’s ITA acquisition. It can also recommend nearby restaurants thanks to the data from the Zagat acquisition. It can even determine that you are heading to work (based of time of day and if it’s a weekday) and let you know the traffic based off Waze data

According to reports from The Information, Google competed against Facebook for DeepMind.

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