Apple has acquired social media analytics firm Topsy for at least $200 million, signaling that Apple sees a big future in big data in the social sphere.

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Apple has always been a hardware-oriented company, although this focus has been done with tight integration with software. But while this tight integration has been at the core of Apple products since the start, there is now a big external factor that the company has to consider, and that is the user data and sentiment that is out there in the cloud.

Apple’s latest acquisition — that of social analytics firm Topsy — embeds the Cupertino company right into the heart of the conversation on social networks. Topsy’s expertise is analyzing the so-called Twitter firehose, and Topsy has access to all tweets since 2006. Topsy then analyzes these conversations, information and sentiment, offering this as  a premium service to customers. Topsy can also analyze sentiment and tweets based on geography — it uses landmarks and local events to determine the origin of tweets.

Apple confirmed the acquisition, but would not say what the purpose will be.

“Apple buys smaller technology companies from time to time, and we generally do not discuss our purpose or plans,” said a spokesperson.

Analysts speculate that Apple’s acquisition of Topsy would enable it to have better technology in making recommendations for music, movies, TV shows, apps and other content, based on user sentiment. Competing ad platforms — like Facebook Ads and Google AdWords — use a combination of user data, demographics, sentiment and context, in targeting advertising. The same could be the case for Apple, with its iAds platform.

Additionally, Topsy could benefit iOS users, by enabling Siri to provide better responses to queries that might involve social context. The bigger benefit could be for partners, such as advertisers and media companies that provide content to iTunes.

Source: Wall Street Journal