On Monday, Twitter (TWTR) - Get Report  announced it was acquiring Magic Pony, a U.K.-based startup featuring 11 PhDs, for an undisclosed sum. The move should help improve the social networks's video content, but it's unclear whether it can really move the needle in terms of its larger challenges of attracting and retaining users.

Magic Pony was working on artificial intelligence (AI)/machine learning technology that can automatically analyze and enhance photo and video content. Interestingly, its solution relies not only on analysis of content within an image itself, but also of similar images, in much the same way humans classify and group objects they have seen.

Twitter, whose user Timelines tend to be chock-full of video content from its standard 30-second video upload service, its Vine 6-second video platform and increasingly, its Periscope livestreaming platform, said the purchase will expand "the machine learning capabilities in Twitter's video technology and [add] valuable talent" to its Cortex machine learning team.

TechCrunch reports the acquisition price is $150 million. On Monday, shares of Twitter advanced 1.5% to $16.34, but over the past 12 months, the company's stock is down more than 54%.

With Magic Pony based out of London, Twitter can probably use offshore cash to pay for the acquisition, just as it was likely able to for its reported $70-million investment last week in audio-sharing platform SoundCloud.

And the purchase does strengthen Twitter in a field that Facebook (FB) - Get Report , Alphabet (GOOGL) - Get Report , and more recently Apple (AAPL) - Get Report have also made meaningful investments in, albeit usually with an eye towards photo classification rather than video enhancement.

Twitter, Facebook, Alphabet and Apple are holdings in Jim Cramer's Action Alerts PLUS Charitable Trust Portfolio. Want to be alerted before Cramer buys or sells TWTR, FB, GOOGL, or AAPL? Learn more now.

Facebook has long used AI to both detect faces within photos and root out offensive content. Mark Zuckerberg & Co. are also now using AI to detect objects within a scene, and to classify videos based on content type -- for example, understanding what sport is being played in a video clip.

Google Photos (launched last year) automatically tags and organizes uploaded photos with often-impressive accuracy, thanks to the massive and probably unmatched investments in AI that Google has made over the past several years. And Apple recently announced that iOS 10's Photos app will offer similar features, but with the AI work done on a user's device rather than in the cloud.

In addition to improving video quality, Twitter might be able to leverage Magic Pony to automatically create visual effects for clips. The startup's CEO says that the machine learning techniques it uses to analyze videos "can identify the features of imagery and use that information to process it in new ways."

Meanwhile, one of the VCs backing Magic Pony says the company was "working on a pretty substantial VR and AR strategy" before Twitter came calling. There are some parallels here with Snapchat's 2015 purchase of Looksery, a startup that developed technology for superimposing animated filters on a person's face during a video chat.

Looksery's technology now powers Snapchat's Lenses feature for selfies. 

But while Magic Pony's technology clearly has some value for a platform as video-heavy as Twitter, the company is -- assuming TechCrunch's report is right -- committing quite a lot of cash towards something that merely enhances existing Twitter features. The same arguably goes for the SoundCloud investment, particularly since Twitter has been integrating SoundCloud's content since 2014.

While $220 million -- the combined reported cost of the Magic Pony and SoundCloud deals -- is more or less pocket change for Facebook, which sports a $327 billion market cap, or Google and its $479 billion market cap, for Twitter, it's a sum equal to nearly 2% of the company's $11.4 billion market cap.

Meanwhile, many of the issues that have stunted Twitter's user growth and engagement rates -- an interface that leaves many first-time users bewildered, the difficulty of keeping up with Twitter's Timeline "firehose" and ignoring post after post relaying the same information, the self-promotional feel of so much Twitter content, the personal attacks that find their way into many Twitter arguments and the challenges new users face in gaining followers or otherwise getting noticed -- remain very much in place.

And the considerable talent loss Twitter has seen over the last two years certainly doesn't make addressing these challenges easier. It's unlikely social media users who have been turned off by Twitter due to one or more of the aforementioned issues will come back simply because the service has higher-quality video clips.

"I am beginning to believe, after reading an excellent story about Twitter in TheHive, that this company can no longer stay independent," said Jim Cramer, TheStreet's founder and manager of the Action Alerts PLUS portfolio, which owns Twitter.