Microsoft Acquires Natural-Language Online Interaction Company

Financial terms have not been disclosed, but Microsoft announced this afternoon that it has acquired privately owned Colloquis Inc., a purveyor of online business software and services that feature natural language-processing technology.

You can get a feel for what the Colloquis technology does by visiting the company’s website and trying the online demonstration provided on the right side of the home page. The company’s software seems capable of providing text-based answers to a wide range of contextually relevant questions.

I asked the demo whether the company’s software could support voice, and I got the following answer:

Although Colloquis technology could in principle be employed within a voice application architecture, we have chosen to focus on text-based applications. If you are interested in using Colloquis technology in a voice-based solution, please contact Colloquis Sales Department.

Colloquis’ existing customers include Comcast, Panasonic, Cingular, MSN (that makes sense, given today’s developments), Encarta (another Microsoft connection), AOL, CareerBuilder, TimeWarner Cable, Cox Communications, Vonage, P&G, and Harrisdirect.

Microsoft will incorporate the Colloquis technology into its own products as well as offer services based on it to businesses with online operations. Initially, Microsoft will offer a managed service called Windows Live Service Agents based on Colloquis’ Automated Service Agent offering. Windows Live Service Agents will augment Microsoft’s existing contact center solution, Microsoft Customer Care Framework (CCF).

Xbox will be the first group within Microsoft to use Windows Live Service Agents. Microsoft says the Colloquis technology will enable Xbox customers to rapidly find helpful information related to their support needs.

Microsoft also plans to use Colloquis technology in an application called Windows Live Agents (why are so many of Microsoft’s products given such similar, ultimately confusing names?), a conversational application that users can interact with via Windows Live Messenger. According to Microsoft, its Microsoft Live Agents are used to entertain, encourage engagement with products or services, provide a new advertising opportunity for brand advertisers, and drive search and information retrieval.

This acquisition is intended to improve the efficiency of Microsoft’s customer service and to reduce operational costs. The Colloquis technology works and seems to have some further potential, so we’ll have to see how well Microsoft integrates it into its products, services, and support offerings.

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