Microsoft acquires British tech firm SwiftKey in $250m deal

British company to be absorbed into Microsoft R&D

Microsoft will today announce the $250m acquisition of SwiftKey, the company behind the popular keyboard app for iOS and Android operating systems. The move signals Microsoft's continued determination to remain a player in mobile devices - despite market share for its Windows Phones dipping to around one per cent in the last quarter of 2015.

SwiftKey is widely regarded as the best virtual keyboard available for mobile devices, with its predictive text capabilities also integrated into the keyboard on BlackBerry 10. The company's technology is able to tap users' Gmail accounts in order to learn their writing style. SwiftKey's latest technology is based on neural network artificial intelligence, which it applied to the predictive text in a recently launched Android keyboard.

The developers behind SwiftKey will join Microsoft's research unit. The company was founded in 2008 by co-founders Jon Reynolds and Ben Medlock, currently CEO and chief technology officer respectively. The company has raised more than $20m in venture capital from Accel Partners, Index Ventures and Octopus Investments, among others, who will no doubt have been keen to cash out given the sum Microsoft was offering.

The company has its head office in London, as well as offices in San Francisco and Seoul, and "people in India and China".

"We love SwiftKey's technology and we love the team that Jon and Ben have formed," said Harry Shum, head of Microsoft Research. "We believe that together we can achieve orders of magnitude greater scale than either of us could have achieved independently."

However, $250m is a lot of money for a company, which Microsoft won't have bought out of "love" alone. The Financial Times suggests SwiftKey hadn't enjoyed the financial success to match the popularity of its app, but as part of Microsoft, its technology could be more broadly applied. Its artificial intelligence technology, for example, could be applied to Cortana to help it better understand users.

SwiftKey, incidentally, is also an Amazon Web Services (AWS) user - a corporate case study, no less - and it will, presumably, be shifting to Microsoft Azure. The cloud compute is required for SwiftKey to analyse and refine the service for users.

"We collect and analyse tens of terabytes of web-crawled data to create language models and build cloud services, like personalisation, for millions of active users. To do this, we need a highly scalable, multi-layered system that can grow with steadily increasing demands," explained Dr Sebastian Spiegler, SwiftKey's data team lead.