Interactions Snaps Up AT&T’s Watson

AT&T has transferred ownership of its Watson speech technology product line to intelligent virtual agent solutions provider Interactions in exchange for an equity stake in the company. Financial terms were not disclosed.

AT&T's Watson is a speech and natural language engine that processes and analyzes speech input, performs services, and returns results in real time. The software platform enables developers to create automated multimodal applications and includes speech recognition, text-to-speech, natural language processing, biometrics, and machine learning.

For its part, Interactions will take the technology and incorporate it into what it's calling "the Interface of Things," a new area for speech technologies to become the preferred means of interacting with systems and devices.

"We've always had a vision of expanding our capabilities into a broader market," says Mike Iacobucci, CEO of Interactions. "We believe that the Watson platform, its people, technology, and everything that we gain with that accelerates our ability to execute on this vision."

The deal, Iacobucci adds, is "really about is being able to bring our Adaptive-Understanding solutions into a much broader market, where we can create interfaces that allow speech and natural language understanding to work and be productive."

The companies' partnership will be "very disruptive," Mazin Gilbert, assistant vice president of inventive science at AT&T Labs Advanced Technologies, says. "It's going to help us to create solutions in the market that are really not available today, that have never been done before."

"We've had this vision of creating solutions on top of Watson that drive a connected life experience across a number of businesses, in the car, home, away from the home," Gilbert says. "Our visions are very similar to each other. Putting this shared vision together by putting their assets with ours really creates a very different type of capability that truly is disruptive in the market."

Iacobucci says currently there are limitations with speech recognition. "We think that we've tackled that significantly with our approach on the care side. Watson has incredible technology and an interesting platform, and we can bring that to a much broader market."

Interactions also brings in a human element that Iacobucci says follows the same protocols as a speech recognition engine. "It is a way of understanding extremely complex human dialogue, where speech recognition historically experiences trouble, including open-ended sentences, alphanumeric data, out-of-grammar responses, and scenarios with background noise or accents," he states. "The company's technology is focused on using the combination of human- assisted understanding and an ASR engine to create conversational, or humanlike, systems."

But for all that the deal brings together, Phil Gray, executive vice president of business development at Interactions, sees the biggest market potential in natural language understanding. "If you look at where the world is headed, NLU is the big opportunity,"he says.

However, Gray says that with NLU there are a number of industry challenges. "By taking Interactions' technology and combining it with the natural language capabilities of Watson, [there] is an opportunity to take natural language to the masses, for developers to build applications more easily, reliably, and deploy them across a wide set of devices."

Dan Miller, senior analyst at Opus Research, expects the deal to mark a big change in the speech processing market. "AT&T has made huge investments in people, patents, and technology to improve natural speech language speech processing and voice biometrics, and Interactions has a proven track record in putting the technologies to use in the enterprise market," he says.

This is not the companies' first alliance. In April 2013, Interactions signed a licensing agreement with AT&T allowing it to incorporate Watson in its Adaptive-Understanding technology, which delivers speech-enabled virtual assistant applications for enterprises in the customer care market.

"For speech recognition, Interactions' applications leverage its own human-assisted understanding in conjunction with the Watson ASR engine," Iacobucci said at the time. "We found Watson to be the most advanced, sophisticated ASR engine that we could leverage [more] than other automatic speech recognition (ASR) engines that we explored.

The current deal will, of course, benefit both AT&T and Interactions, but it can also be viewed as a boon to the speech technology industry overall. While those in the sector know the power of speech, many companies have put off investments waiting for more reliable and consistent performance.

"The reason why some enterprise customers may not have adopted these technologies is because of the lack of precision," Gilbert says. "They can't put something in front of their customers and say 'It works sometimes but it may not work all of the time, sorry.' This [partnership] is going to allow us to be able to create applications with the precision that the enterprise expects."

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