Just as Google and Facebook are trying to be more like Apple, Apple is trying to be more like them.
According to The Wall Street Journal, the maker of the Mac, the iPhone, the iPad, and the iPod just paid more than $200 million for Topsy — a startup offering a rather impressive search engine for Twitter and other social sites — and that makes two social search buys in two months. In early October, Apple reportedly paid somewhere between $40 million to $60 million for app maker Cue.
Apple’s big bets on two properties well outside its core business are just the latest evidence that the personal technology sector is consolidating into the hands of a few enormous corporations — tech giants that integrate a wide range of online services, software, and physical devices. Google began as a search engine, but now the company offers a social network, its own mobile environment, and even its own phones. Facebook was originally just a social network, but now it does search, and yes, it too offers its own mobile operating system, running on a phone tagged with its own brand.
Apple is building a similar empire — just from the other direction.
Such vertical integration helps these companies more efficiently deliver new products that work well with all the other tools around them. But this is also a way for the giants of tech to drive additional purchases and rake in the revenues through online advertising. If people use your stuff across multiple platforms, you can not only show them more ads and more products, you know more about them — and that helps target ads with far more precision.
Nowadays, Apple is moving into all sorts of online services, including everything from iTunes to its new mobile mapping tool, Apple Maps. It’s not clear why the company is suddenly interested in social search, but there are so many ways the company could use Topsy and Cue, in part because both offer not only search engines but also tools for analyzing the use of social networks.
There has been speculation that, with the Topsy deal, Apple might be looking to improve recommendations in its App Store or its iTunes Store, improve its Siri digital assistant, which leverages web search, fine-tune its ad targeting, or even forecast product sales. Individually, each is a just guess. But the larger point here is Apple could very well be looking to do all that. Social search is one of the most fertile frontiers in the burgeoning area of “big data,” a place where you can mine all sorts of valuable information capable of feeding any number of other endeavors.
That’s why Google pivoted its operation around Google+, an attempt to graft social networking features onto search and other properties. And it’s why Facebook spent upwards of a year developing Graph Search, a social search engine that is now rapidly evolving in front of our eyes.
Though it has never been as obsessed as Google, Apple has long shown an interest in search, from the Spotlight search system integrated into OS X in 2004 right through to the 2011 launch of Siri, a search service wrapped in a humanoid voice, and now it’s taking the next step. There may be bumps along the road — as there were with Apple Maps — but clearly, Apple is committed to becoming far more than just a hardware maker.
The company has close to $150 billion in cash, which means that the Topsy and Cue deals — at around $250 million put together — could simply be peripheral buys for a peripheral business like ads. But ads could very well become a big business for Apple. Don’t think of the company as a hardware maker — or even as a hardware makers that offers software too. Think of it as a tech empire, something that will rival every bit of Google and Facebook.