and intelligent assistants respond to simple commands and queries, such as giving a weather report, playing a song or sharing a reminder, but aren’t able to understand meaning or carry on conversations. For rich and effective communication, intelligent assistants need to be able to have a natural dialogue instead of just responding to commands. This is called “conversational AI”.

To this end, Microsoft has acquired Semantic Machines Inc, a Berkeley, California-based company that has developed a new approach to building conversational AI. Its work uses the power of machine learning to enable users to discover, access and interact with information and services in a much more natural way, and with significantly less effort.

The company is led by many pioneers in conversational AI, including technology entrepreneur Dan Roth and two of the most prominent and innovative natural language AI researchers in the world, UC Berkeley professor Dan Klein and Stanford University professor Percy Liang, as well as former Apple chief speech scientist Larry Gillick.

Microsoft has driven research and breakthroughs in the fundamental building blocks of conversational AI, such as speech recognition and natural language understanding, for more than two decades. The goal has been to expand our vision of computers all around us to a world where they could see, hear talk and understand as humans do. In 2016, it took another big step toward realising this vision of conversational computing with the introduction of a framework for developing bots and the release of pre-built Cognitive Services for infusing speech recognition and natural language understanding into intelligent assistants. Today, there are more than one million developers using Microsoft Cognitive Services and more than 300,000 developers using Microsoft’s Azure Bot Service, all helping to make computing more conversational.

Microsoft is further developing its work in conversational AI with its digital assistant Cortana, as well as with social chatbots like XiaoIce. XiaoIce has had more than 30 billion conversations, averaging up to 30 minutes each, with 200 million users across platforms in China, Japan, the United States, India and Indonesia. With XiaoIce and Cortana, Microsoft has made breakthroughs in speech recognition and more recently become the first to add full-duplex voice sense to a conversational AI system, allowing people to carry on a conversation naturally.

With the acquisition of Semantic Machines, Microsoft will establish a conversational AI centre of excellence in Berkeley to push forward the boundaries of what is possible in language interfaces. Combining Semantic Machines’ technology with Microsoft’s own AI advances, it aims to deliver powerful, natural and more productive user experiences that will take conversational computing to a new level.