Salesforce Has Big Plans For Latest Artificial Intelligence Acquisition

April 7, 2016, 8:56 PM UTC
John P. McMahon © JPMphotography 2015

Salesforce’s acquisition of an artificial intelligence startup this week will ultimately help customers wring more value from the data they’ve been collecting for years, according to Salesforce president and chief operating officer Keith Block.

The business software giant bought MetaMind, a Palo Alto, Calif.-based company that sells natural language processing, computer vision, and database prediction tools, for an undisclosed amount. Computers running the appropriate software can use MetaMind’s products to sift through reams of data and adapt its actions going forward based on what it learns.

And that’s a hot space of late. Late last year, Salesforce bought MinHash to bring AI to its marketing services; Microsoft (MSFT) bought fellow AI company SwiftKey; Intel (INTC) bought Saffron AI; and IBM (IBM) simply can’t stop talking about Watson, its cognitive computing (IBM-speak for AI) service. Additionally, Amazon is said to have bought Orbeus, although it hasn’t publicly confirmed the acquisition.

Data ownership is going to get a lot trickier

The problem for many companies right now, Block told Fortune, is that they’ve been collecting huge amounts of data, but they’ve failed to do much with it. He cited a recent meeting with the CEO of a large oil and gas company. “They have upstream and downstream devices collecting data but they’re not taking any action on it. They’re looking for ways to interpret that data and get to the next step,” he noted.

That’s what Salesforce hopes MetaMind’s capabilities will enable. AI, is a natural fit for Salesforce (and other IT providers) that are already analyzing data for customers. In predictive analytics, machines can be remotely monitored as they work to detect possible issues before they become big problems.

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That could mean that Salesforce’s Service Cloud would flag a new and unusual vibration of a machine tool part, and open a maintenance ticket for it to be checked. In theory it’s super smart help desk ticketing for industrial gear.

“Every service case means a sales opportunity,” said Block who was in Boston for a Salesforce event.

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Salaesforce (CRM) is the pioneer of delivering software services from its own servers—a sales model known as software as a service or SaaS. In the 15 years since Salesforce debuted, all of the legacy software players including Microsoft (MSFT), Oracle (ORCL), and IBM (IBM) have mimicked that model with varying degrees of success.

And Salesforce has generated huge revenue, if not profit, doing that. Its flagship sales software product for sales teams is still its largest business, although the company has branched out into service, support, and marketing applications as well. Block said the “sales cloud” is $3 billion a year in revenue but that the Service Cloud is also a multi-billion-dollar business.


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