Apple Nabs Topsy for Sentiment Analysis

Apple will be doing some heavy-duty customer sentiment analysis in the near future thanks to its recent acquisition of Spotify. The reported $200-plus-million purchase gets Apple access to the entire, unabridged collection of tweets that have been made since Twitter was born in 2006, and sophisticated tools for analyzing those tweets.

Spotify is one of just a handful of Twitter partners that have maintained a repository of every tweet posted to the social media site, what has been called “the fire hose.” The size of the entire collection is said to be on the order of 425 billion posts, and is said to be growing at the rate of 500 million tweet per day. That’s a lot of posts about cats, Justin Bieber, sushi, Transformers movies, and everything in between.

The San Francisco, California, company makes money selling access to its massive repository of tweets, and also by selling search tools to customers. Its core piece of IP is a proprietary social influence algorithm that measures social media authors based on how much others support what they say. Users are able to narrow down trends across categories, and segment them by keywords, activity, influence, exposure, sentiment, language, and geography.

Spotify competes with the likes of DataSift and Gnip, but it’s said to be the choice for customers looking for easy-to-use tools. Journalists use it to see what’s trending after major disasters, like Superstorm Sandy, and is on the list of recommended tools in The New York Times guide for journalists. According to Bloomberg, the service is good at predicting stock moves the following day based on sentiment capture from Twitter.

What, exactly, Apple plans to do with Spotify and its firehouse of Twitter data is the subject of rampant speculation, since neither Spotify nor Apple are saying much. Apple has been accused of being anti-social at times, and of missing the boat with the social network revolution.

The folks at The Wall Street Journal, which broke the story Monday, theorize that it bought Spotify to bolster the technical skills, since Apple was already a Twitter partner and had integrated Twitter with its iOS and OS X platforms.

The most promising possibility has Apple using the technology and technical skills to flesh out the social relevancy engine of its App and iTunes Stores. It could be used to help surface the best and most pertinent apps more quickly, and to help provide more customization of apps based on users’ personal preferences, as depicted in their Twitter feed. It could also use the technology to recommend songs, movies, and TV shows to iTunes users.

The acquisition may also bolster Apple’s iTunes Radio or its iAd platform, analysts posit. In any event, the acquisition lends further credence to the idea that the time to mine social networks for user preference data is now. It will likely bolster the valuations of companies already in this space, like DataSift and Gnip, and accelerate the movement of others into the space.

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