IBM is announcing the launch of a new, $1 billion Watson Business Group, $100 million in venture capital earmarks toward new Watson apps, and a shiny new Watson headquarters in New York's East Village neighborhood on Thursday. The news means that IBM has essentially made a $1 billion bet on Watson, the big data-cloud service hybrid which famously competed on Jeopardy and, more importantly, saves lives. If it succeeds, IBM will have the means to provide Watson's services to every American workplace.
Put another way, IBM wants to transform Watson into a Siri for business. The platform is designed for users to ask Watson questions, with Watson giving answers—such as medical diagnoses for hard-to-diagnose diseases, or the likely outcome of business decisions—on the spot. The iconic tech multinational has excelled for decades at enterprise services, but has had much less success targeting home users (just remember how IBM PC clones became de rigeur in the 1980s and the failure of OS/2, but the new Watson Business Group appears to be aimed at making Watson as ubiquitous as IBM's computer equipment. Stephen Gold, vice president of IBM Watson Solutions, tells Fast Company that over 2000 employees will work in support of the new Watson Business Group, which will preside over an app ecosystem where over 750 applicants have expressed interest in developing Watson-based apps using $100 million in future IBM equity investment.
Gold says a big part of this push grew from Watson being used in industries that do not currently use much big data or analytics. Two new Watson products, IBM Watson Discovery Advisor and IBM Watson Analytics Advisor, target a mass business audience. According to an IBM press release, the Discovery Advisor takes aim at publishing, education, and health care. And Analytics Advisor could be a game-changer for IBM if it works as promised: The software "allows business users to send natural language questions and raw data sets into the cloud, for Watson to crunch, uncover, and visualize insights; without the need for advanced analytics training. After analyzing the data, Watson will deliver results to its users through graphic representations that are easy to understand, interact with, and share with colleagues; all in a matter of minutes."
The 2,000+ employees of the Watson Business Group will be headquartered at 51 Astor in New York's East Village. Twitter is reportedly looking at office space in the building and the headquarters of AOL and the Huffington Post (and soon Facebook) are directly across the street. The formerly bohemian neighborhood is situated right next to New York University and Cooper Union, too. (Expect the line at Ippudo ramen house to grow even more spectacularly longer, as well). Alongside conventional office space, the Watson headquarters will also include space for a tech incubator for startups building Watson-based apps and an events area that will offer "networking opportunities" alongside workshops and seminars for Watson developers. "We chose (the Silicon Alley location) because of access to universities, talent, and accessibility, " Gold said. "Being based in New York City is central for drawing talent for Watson."
Also buried in IBM's announcement is boring but important news: The company is reengineering Watson to be deployed on Softlayer, a cloud computing firm IBM purchased for $2 billion in 2013. Watson's lack of integration with Softlayer is reportedly a sore spot for IBM customers; as of press time, no date is available for the Softlayer integration. Wall Street Journal reporter Spencer E. Ante also pointed out that "Watson's basic learning process requires IBM engineers to master the technicalities of a customer's business—and translate those requirements into usable software. The process has been arduous."
Over the past few years, IBM has worked hard to sell Watson to health care consumers and to turn the big data platform into a linchpin of research medicine. This past November, the company announced a series of new Watson apps for health care, including WatsonPaths—a fascinating product that crunches text from tens of thousands of medical textbooks in order to generate semantic data. When doctors and researchers ask WatsonPaths a question about a hard-to-diagnose patient, Watson uses the data it was fed to refine diagnoses and suggest treatment options. It's an early effort, to be sure, but an example of the transformative things that can be done with data these days. IBM has also built Watson partnerships with medical facilities and educational institutions around the country.
As we spoke, Gold seemed most excited about the new ecosystem that is being built around Watson—this past November, IBM introduced a Watson API that's a precursor to the new Watson business ecosystem and this is being expanded into a larger app store in 2014. This year's currently slated apps seem interesting but not world-changing—personal shopping app Fluid, products by medical supply chain firm MD Buyline, and products by WellTok, a company which lets health insurers engage with consumers. At press time, the Royal Bank of Canada and the Nielsen Company are confirmed as firms speaking with IBM about Watson business possibilities.
Gold tells Fast Company that Watson for Business is "one of the top innovations in IBM's history" and it could even be the biggest IBM innovation since the IBM PC: If IBM can make the UI and search functions easy enough to grasp, it'll be them—and not Apple's Siri or Google's Google Now—that really makes big data part of our everyday lives. But the onus is on IBM to convince the business world that Watson is worth adopting.
Correction: An earlier version of this article incorrectly stated that Watson makes diagnoses for medical patients. Rather, it refines potential diagnoses and suggests treatment options.