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IBM Is Using Watson to Target Start-Ups

NEW YORK (TheStreet) -- Staid technology giant IBM (IBM - Get Report) is fighting to regain its status as a leading innovator with Watson, its supercomputer that evaluates information more like a human than a computer, taking its cloud and cognitive technology to the doors of start-ups. 

"If you've got an idea or five -- fantastic!" said Jonas Nwuke, partner development for IBM. "We think the community would be far better at figuring out what Watson would be good at. One organization can't see it all."

Fighting back against criticism that it lags in cloud computing, the company has pushed Watson into the spotlight in the hopes that IBM can lead the pack with a new generation of apps for its Watson technology. Combining cloud and cognitive computing, IBM created the Watson Developers Cloud, a part of the IBM Watson Group, to power app innovation. IBM is taking Watson and giving it to budding start-ups who could use the artificial brainpower and who could return the favor by bringing new ideas to Big Blue.

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"It is a realization that IBM can't find the problems or all the things that Watson can solve by ourselves. So, we are looking for help building Watson applications," Nwuke said, "We are looking for partners to help provide content for other people who want to build Watson applications and we are looking for people to come and help other people realize their vision for a Watson application."

During IBM's first-quarter, cloud revenue grew 50%, with the annual run rate doubling year over year to $2.3 billion for cloud as a service.

IBM pumped $1 billion into the IBM Watson Group for the development and research related to cloud-delivered cognitive applications, and invested $100 million for venture investments to support IBM's recently launched ecosystem of start-ups and businesses that are building a new class of cognitive apps powered by IBM Watson Developers Cloud, according to a January press release.

Over 2,500 individuals and organizations have reached out to the IBM Watson Group since it released the Watson Developers Cloud in November of last year. Now, the IBM Watson group is setting its sights on "Silicon Alley" in New York.

IBM waives its ownership of the artificially intelligent technology to chosen start-ups in return for 30% of the profits upon commercial release of the application, according to Senior Adviser of Digital Strategy for IBM Watson Group, Michael DiTanna. "We sign away all of our rights," DiTanna said. "We don't normally do that."

IBM is working on various initiatives around Watson, to spur developers, including Watson Ecosystem Program, IBM Mobile First and IBM Interactive Experience. Three of the first Watson-powered apps were designed for the retail industry, finance and health care: Fluid, SharpeMind and schEMA, respectively. The schEMA app is designed by Modernizing Medicine and is due to roll-out in the fourth quarter, according to co-founder and Chief Medical Officer of Modernizing Medicine, Dr. Michael Sherling. 

Modernizing Medicine uses an electronic medical record system to help doctors find information from the most recent published articles for patients. Subsequently, schEMA will enable physicians to pose questions, describe symptoms or search for information about various conditions through Watson.

Dr. Sherling said Watson's power can help physicians answer medical questions about rare conditions at a faster pace with more-up-to-date results. "It is going to give me real information from articles published a week ago instead of articles read months ago or from memory. Watson is not just a search engine. It uses a series of algorithms to get a direct answer."

Modernizing Medicine and IBM are currently working to include branches of medicine outside of dermatology including orthopedics and plastic surgery. Both Sherling and Nwuke stress that Watson's capabilities reach beyond search, to create, as Nwuke said, "machines that understand." 

By moving its moving into its headquarters at 51 Astor Place in New York City, The IBM Watson Group is hoping to attract talent from New York's "Silicon Alley." Reaching out to the city's entrepreneurs, the group held a series of Meet Ups in June. Kicking off with "An Introduction to IBM Watson," IBM explained to hopeful app creators what Watson and IBM offer the up-and-coming apps.

"It is an investment on our end," Nwuke added. "Once an application is released commercially there is a revenue share that kicks in at that point. It is not a client relationship with IBM, it's a partner relationship."

-Written by Kathryn Mykleseth in New York

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