IBM Leads Industry Peers in Artificial Intelligence Patents

IBM Continues Acquisitions and Cloud Strategy Without Much Success (Part 3 of 14)

(Continued from Part 2)

SMAC has contributed to the emergence of deep learning

With the advent and the arrival of the SMAC (social, mobile, analytics, and cloud) revolution, the technology space is rapidly transforming and moving towards the digital space. The influx of data, the majority of which is unstructured, coupled with the advances in processing power and cognitive technology has led to the necessity of machine learning to facilitate better-informed decisions.

In today’s scenario, understanding the content of images as well as organizing and extracting the relevant information from raw media and data pose a significant challenge. The specialty of deep learning is that it can be deployed in structured as well as unstructured data and context. IBM (IBM) saw this opportunity and invested $1 billion in cognitive computing and machine learning in 2014.

To gain diversified exposure to IBM, you can invest in the Technology SPDR ETF (XLK). XLK invests 3.51% of its holdings in IBM.

IBM has the largest number of patents related to AI

The above presentation by USPTO shows that among its technology peers, Microsoft (MSFT), Google (GOOG), and Oracle (ORCL), IBM is the leader with approximately 500 patents related to artificial intelligence in 2013. IBM’s focus and position in artificial intelligence were solidified by its super computer, Watson, that entered the healthcare sector in 2013. IBM claims that Watson has helped lower the error rate in cancer diagnoses by physicians.

Owing to the huge growth expected in this space, many AI startups have already been acquired or are on the verge of being acquired by large players.

Continue to Part 4

Browse this series on Market Realist: