Artificial intelligence (AI) is still in its infancy, but it is truly a transformational technology. Thus far, mainly the companies with the largest stores of data have been able to benefit from the science. When talking about AI, most are referring to machine learning and, more specifically, deep learning, a technique that requires the processing of massive amounts of data in order to train these systems.
Technology companies like Amazon.com (NASDAQ: AMZN), Alphabet (NASDAQ: GOOGL) (NASDAQ: GOOG), and International Business Machines Corporation (NYSE: IBM) are the biggest examples of companies tapping into this data-driven revolution.
So far these innovations haven't been largely available to smaller companies, but that is changing. The widespread adoption of cloud computing is beginning to alter that dynamic, as companies are working to incorporate these capabilities into their cloud offerings. This is just the beginning of the transition to AI-as-a-Service.
Big data led to breakthroughs in AI technology. Image source: Getty Images.
Enabled by big data
How these tech titans came by the data necessary to train AI systems varies. Amazon has tons of information on the customers who frequent its e-commerce site. Alphabet has years of records from Google's internet search engine. With no similar source of such data, IBM gathered it through acquisitions and partnerships.
These companies initially found ways to improve their business operations and products using the insights gained from AI. As early as 1999, Google was using a primitive form of AI to improve its search results. Amazon has used the technology to make product recommendations, provide forecasting, and optimize its logistics. IBM has long performed business analytics for its large client base, so adding AI to the mix was a natural fit -- one the company labeled cognitive computing.
Show me the money
Due to the different path each company has taken to AI, the way they are monetizing the technology varies.
IBM has focused on a number of industries like healthcare and has been stockpiling data. Several years ago, IBM bought cloud-based analytics company Explorys and population health specialist Phytel to gain access to their expansive clinical data sets. The company then acquired Merge Technologies and Truven Health Analytics for $1 billion and $2.6 billion, respectively, both of which increased its access to patient health-related data. IBM has been culling information from these records in an ongoing effort to find solutions for healthcare providers. The company has been using the same data aggregation strategy to expand into other industries like retail, finance, and insurance.