Updated from 5:25 P.M. to include comments from Apple in the third paragraph.
First reported in The Wall Street Journal, Topsy allows companies to gather information from Twitter (TWTR), and track consumer sentiment. On the company's Web site, Topsy says users can figure out trends by looking at certain metrics. "Use precise metrics to model current trends against competitors or past events," Topsy wrote. "Design and optimize actions, or predict future outcomes."
An Apple spokeswoman confirmed the deal in an email to TheStreet. "Apple buys smaller technology companies from time to time, and we generally do not discuss our purpose or plans."
Though it's not immediately clear how Topsy will be employed by the tech giant, it could be used for Apple's App Store to continue refining its search methodology and let users find applications more easily.
It's also possible that Apple may use the technology for iTunes Radio, which generates revenue from selling ads to advertisers. "Identify key thoughts, opinions and content, over time or in realtime," Topsy says in its "About me" section of the Web site. That could potentially let Apple target songs and artists that are being shared on Twitter with higher-paying advertisements.
Topsy could not be immediately reached for comment for this story.
--Written by Chris Ciaccia in New York
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