Apple Buys Lattice Data

Apple once led the pack with its intelligent assistant Siri, but in just a few years, Amazon, Microsoft and Google have chipped away at its lead.

Siri is a critical component of Apple’s vision for the future, so integral that it was willing to spend $200 million to acquire Lattice Data over the weekend. The startup was working to transform the way businesses deal with paragraphs of text and other information that lives outside neatly structured databases. These engineers are uniquely prepared to assist Apple with building a next-generation internal knowledge graph to power Siri and its next generation of intelligent products and services.

Broadly speaking, the Lattice Data deal was an acquihire. Apple paid roughly $10 million for each of Lattice’s 20 engineers. This is generally considered to be fair market value. Google paid about $500 million for DeepMind back in 2014. At that time, the startup had roughly 75 employees, of which a portion were machine learning developers. Give or take a few million, the math pretty much works out. But beneath the surface, the deal signals that Apple is willing to spend significant capital shoring up the backbone of Siri.

Apple and its peers grapple with the challenge of teaching conversational assistants basic knowledge about the world. Apple relies on a number of partnerships, including a major one with Yahoo, to provide Siri with the facts it needs to answer questions. It competes with Google, a company that possesses what is largely considered to be the crème de la crème of knowledge graphs. Apple surely has an interest in improving the size and quality of its knowledge graph while unshackling itself from partners.

Lattice’s experienced engineers are particularly important to Apple as it designs future products for an AI-first world. Companies like Microsoft, Facebook and Google have already declared their intentions to build up infrastructure to support the implementation of machine learning in as many products and services as possible. Apple brought on Rus Salakhutdinov in October 2017 to lead research efforts at the company, and it has acquired startups like Turi and RealFace, but it still has a lot of work to do if it intends to remain competitive in AI in the long run.

“Google is applying machine and deep-learning to about 2,500 different use cases internally now. Apple should be doing the same,” asserted Chris Nicholson, CEO of Skymind, the creators of the DL4

At Apple, the Lattice Data team could start by helping Apple get its knowledge graph up to speed. This infrastructure is integral to Apple’s plan to embed Siri into each of its products. It’s an ideal place to start because it both improves existing offerings like Siri search on Apple TV and lays the groundwork for future products like its rumored Amazon Echo competitor.