Alibaba Invests in AI Startup DeePhi



Alibaba helped raise $40 million for AI startup

Alibaba (BABA) recently teamed up with other investors such as Samsung (SSNLF) to raise $40 million for the Beijing-based artificial intelligence (or AI) startup DeePhi Tech in a series A+ funding round. This funding round was implemented through Alibaba’s Ant Financial subsidiary.

According to China Money Network, investors such as China Growth Capital and China Merchants Capital also participated in the round.

DeePhi is engaged in developing technologies (QQQ) to simplify and accelerate deep learning applications. Its work includes neural network-based AI chipsets for mobile devices.

The chipsets support functions such as neural language processing and instantaneous speech recognition on smartphones.

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Alibaba showing strong appetite for AI

The investment in DeePhi comes at a time when Alibaba has shown great interest in AI technologies. Alibaba recently unveiled a plan to invest $15 billion in R&D (research and development) work focused on foundational and disruptive technology.

As such, Alibaba’s R&D fund would be directed toward developing IoT (Internet of Things), AI, and data analysis technologies.

AI application in Alibaba’s business

There are a variety of ways in which Alibaba could apply AI technology in its business. In digital payments, Ant Financial’s main area of business, Alibaba could use DeePhi’s recognition technologies to enhance payment security and reduce the risk of transaction fraud.

Alibaba could also use AI to enhance user experience on its e-commerce platforms, improve the features of its Tmall Genie smart speaker, and bolster its competition in the cloud computing market.

Alibaba is facing off with industry leaders Amazon (AMZN) and Microsoft (MSFT) in the cloud computing arena. According to Synergy Research Group, Amazon held more than a third of the world’s cloud computing market at the end of 2Q17, as illustrated in the chart above.


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